HomeMy WebLinkAboutCS 30-06
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REPORT TO
EXECUTIVE COMMMITTEE
Report Number: CS 30-06
Date: June 12, 2006
From:
Gillis A. Paterson
Director, Corporate Services & Treasurer
Subject:
2005 Pre-Audit Balances of Reserves and Reserve Funds
Recommendation:
1. It is recommended that Report CS 30-06 of the Director, Corporate Services &
Treasurer be received and forwarded to Council for information.
Executive Summary: Based on the preliminary 2005 results, we can now report on
the pre-audit actual activities within the Reserves and Reserve Funds for 2005. A
summary is presented in Appendix A.
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The purpose and 2005 financial transactions for each Reserve and Reserve Fund are
set out in Appendices Band C respectively.
Financial Implications: Not applicable
Background: As in previous reports filed over the last four years, this report provides
specific information on each of the City's Reserves and Reserve Funds, including year-
end balances. The 2005 pre-audit Reserves and Reserve Funds balance of
$47,374,956 is one of the highest balances ever reported in Pickering. However, this
balance is not fully available for use due to the outstanding commitment of funds not yet
spent, the obligations connected with the collection of funds or other specific purposes
approved by Councilor under Provincial Legislation.
With regard to unspent commitments for capital projects, we are continuing the practice
of not transferring funding for commitments until the expenditures are incurred. This
procedure allows the Reserve Funds to earn interest income as long as funds are still in
the reserve fund's custody and is in compliance with Public Sector Accounting Board
(PSAB) for obligatory Reserve Funds. The combined unspent commitments for all
_ Reserve Funds are $3,939,289.
From 2001 to 2004, the City's share of collections from OPG related to properties under
assessment appeal was $7,705,240. In 2005 an additional amount of $1,631,589 was
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Report CS 30-06
Date: June 12, 2006
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Subject: 2005 Pre-Audit Balances of Reserves and Reserve Funds
Page 2
collected, bringing the December 31, 2005 value to $9,336,829 in the Reserve for
Contingency - OPG pending final decision of this appeal. At this time, we are still
unable to confirm the availability of these monies for corporate purposes. In the
meantime, these funds are being used for the temporary financing of the Don Beer
Arena expansion with the balance being invested.
The Development Charges, Parkland, Third Party/Developer Contributions, Ontario
Transit Renewal, Provincial Dedicated Gas and Federal Gas Tax Reserve Funds
represent funds received for specific purposes subject to legislative requirements and
based on developer agreements or agreements with any third parties. Funds available
in these Reserve Funds are obligatory in nature and should be treated as committed.
The balance in these obligatory Reserve Funds is $26,649,520. The combined total of
the unspent commitments, OPG assessment appeal, other restricted balances and
obligatory Reserve Funds of approximately $40 million reduced the "discretionary"
balance to approximately $7.3 million as at December 31,2005.
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The City established two new reserves and a reserve fund this year, namely: Easement
Settlement Reserve, Provision for Eastern Branch Library Reserve and Federal Gas
Tax Reserve Fund. The Building Permit Stabilization Reserve Fund is included in this
Report for background information only, the official by-law to set-up this account is to be
made effective 2006. The purposes of the reserves and reserve funds are discussed
further in Appendices Band C.
Internal borrowings from the Reserve Funds commenced in 2001 to assist in funding
capital projects. Although the amount borrowed each year has declined, the
outstanding principal balance at December 31, 2005 is approximately $5.5 million.
These loans are undertaken from the Development Charges and Parkland Reserve
Funds. This provided the Reserve Funds with an attractive rate of interest compared to
current market investment rates while at the same time providing a cheaper cost of
borrowing to the capital fund. Interest earned on internal loans represents amounts
earned on the 2001 to 2004 internal borrowings. Repayment for 2005 internal
borrowings will commence in 2006 and interest earned will be reflected accordingly.
Attachments:
1. Appendix A Summary of Reserves and Reserve Funds
2. Appendix B Description of Reserves
3. Appendix C Description of Reserve Funds
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Report CS 30-06
Date: June 12, 2006
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Subject: 2005 Pre-Audit Balances of Reserves and Reserve Funds
Page 3
Prepared By:
Approved I Endorsed By:
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Caryn Kong
Senior Financial Analyst
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Gillis A. Paterson
Director, Corporate Services & Treasurer
GAP:vw
Attachments
Copy: Chief Administrative Officer
Recommended for the consideration of
Pickering City . ouncil
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APPENDIX A
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ATTACHMENT #-1- TO REPORT # C5 50-<)<.0
CITY OF PICKERING
SUMMARY OF RESERVE AND RESERVE FUND PRE-AUDIT ACTUALS
DECEMBER 31, 2005
Appendix B Summary Reserves
4610
4611/4623
4612
4613
4619
4620
4621
4622
4624
4625
4626
Working Funds
Replacement Capital
Contingencies-OPG, Election, Other 2
Self-Insurance 2
Rate Stabilization
Develop.Charges-City's Share 2
Region Transit 2
Continuing Studies 2
Vehicle Replacement
Easement Settlement _ New
Library Eastern Branch _ New 2
Total Reserves
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Appendix C Summary of Reserve Funds
4225
4229
4228
4230
4232
4234
4235
4236
4237
4238
4239
4240
Community Facilities
Development Charges 1 & 2
Capital Works
Parkland 1 & 2
Public Works
Workers Safety Insurance Brd 2
Third Party/Dev. Contributions 1
Ontario Transit Renewal 1
Squash Courts 2
Provo Dedicated Gas Tax 1
Federal Gas Tax Revenue- New 1
Building Permit Stabilization Fees New
Total Reserve Funds
Total Reserves & Reserve Funds
Notes
1 Obligatory
2 Restricted
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Total Obligatory 1 & Restricted 2 -2005 =
CS30ck Appendix A
Pre Audit
2005
$400,000
722,844
10,774,909
915,514
3,388,965
484,204
237,106
342,533
75,000
1,095,129
20,000
$18,456,204
Pre Audit
2005
$265,492
21,135,306
309,872
2,103,061
1,038,206
589,575
1,819,264
19,166
66,087
722,039
850,684
$28,918,752
Audited
2004
$400,000
758,175
9,053,320
940,514
2,619,565
1,921,332
1,025,741
233,159
25,000
Audited
2003
$400,000
730,713
7,813,558
940,514
2,177,209
2,685,297
1,106,634
141 ,884
$16,976,806 $15,995,809
Audited
2004
$380,604
19,496,777
302,610
2,166,696
1,152,444
378,731
1,601,076
14,035
33,713
161,515
Audited
2003
$386,726
15,804,668
535,849
1,959,087
1,465,425
181,023
1,024,691
14,957
7,450
$25,688,201 $21,379,876
Audited
2002
$400,000
615,800
6,791,047
949,106
2,421,909
2,812,214
1,242,507
67,400
$15,299,983
Audited
2002
$352,423
12,866,749
516,013
2,017,875
1,400,169
176,974
402,939
$47,374,956 $42,665,007 $37,375,685 $33,033,125
$17,733,142
$26,649,520
$ 40,079,448
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1"\ TTACHMENT #2- TO REPORT # Cs ;$Ü 'db
APPENDIX B
RESERVE FOR WORKING FUNDS 4610
Actual Balance December 31, 2004
Transfers into the Reserve
$
400,000
Transfers out of the Reserve
Pre Audit Actual Balance December 31, 2005
$
400,000
1. Purpose of this Reserve:
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2.
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The reserve for working funds is used to provide operating cash to assist in
avoiding short term interest expenses incurred on operations, typically during the
first months of the year prior to tax billing and at other times when cash inflows
and outflows do not match as occurs in any corporation.
The interest income on these funds form part of the annual Current Budget
General Government Revenue.
Recommended Maintenance Levels of the Reserve:
It is recommended as a "rule-of-thumb" that this reserve be 2% to 3% of total City
revenues. Based on an average annual revenue of $45 million, at 2%, the
amount to maintain for this reserve should be $900,000.
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APPENDIX B
RESERVE FOR REPLACEMENT OF CAPITAL EQUIPMENT - G/L 4611/4623
Actual Balance December 31, 2004 $ 758,175
Transfers into the Reserve
Revenue Fund Contribution 155,669
Transers out of the Reserve
Transfer to Capital Fund -
Operation Centre (191,000)
Pre-Audit Actual Balance December 31, 2005 $ 722,844
1.
Purpose of this Reserve:
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The purpose of this reserve is to reduce the need to levy for the full cost of major
equipment in the year of acquisition. The reserve acts as a stabilization factor
and helps to avoid both tax rate fluctuations and the issuance of long term debt
or other means of financing.
The interest income on these funds form part of the annual Current Budget
General Government Revenue.
2. Recommended Maintenance Levels of this Reserve:
This reserve should be kept at a level that is equivalent to the replacement cost
of the assets for which they were established. Over the last couple of years, the
reserve balance has been kept at a minimum level.
Contributions to this Reserve are provided for annually in the Current Budget. In
2003, additional sub-categories were set up for accounting purposes to better
match the collection of funds to the application of these funds to particular
facilities as shown on the following page.
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APPENDIX B
The balances pertaining to these sub-categories are as follows:
General Recreation Dunbarton Don Beer Rec Camp Rec Comp Rec Comp
Corp Use prgrms Pool Arena Core Pool Arena Total
$ $ $ $ $ $ $ $
Dec 31/04 84,653 129,760 29,772 62,500 62,893 136,312 252,285 758,175
Transfer in 40,207 18,500 4,962 30,000 27,000 15,000 20,000 155,669
Transfer out (71,000) - (120,000) (191,000)
Dec 31/05 53,860 148,260 34,734 92,500 89,893 151,312 152,285 722,844
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APPENDIX B
RESERVE FOR CONTINGENCIES- GIL 4612
(OPG, Other Assessment Appeals, Election, Miscellaneous)
Actual Balance December 31, 2004
Transfers into the Reserve
Revenue re OPG Assmt. Appeal Properties
Transfer from Revenue Fund
$ 9,053,320
1,631,589
90,000 1,721,589
Transfers out of the Reserve
Settlement OPG Assessment Appeals
$
Pre-Audit Actual Balance December 31, 2005
$ 10,774,909
1. Purpose of this Reserve:
Like the capital equipment replacement reserve, this reserve acts in a tax
stabilization capacity. It was established in anticipation of unknown, unusual or
extraordinary expenditures which occur from time to time.
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The interest income on these funds form part of the annual Current Budget
General Government Revenue.
2. Recommended Maintenance Levels of this Reserve:
In 2003, the large balances in this Reserve were reviewed and grouped into sub-
categories in the General Ledger, for accounting purposes only, to better
distinguish those amounts that are committed and those amounts available for
general corporate use. The sub-categories are as follows: OPG Assessment
Appeal, Elections, Other Assessment Appeals and Miscellaneous.
The transfer regarding Ontario Power Generation (OPG) in the amount of
$1,631,589 for the current year is the City's revenue for properties currently
under assessment appeal. This amount plus the last four years' net contributions
of $7,705,240 resulted in a combined total of $9,336,829. The availability of
these funds is undeterminable as the appeal is still outstanding and is considered
committed in the event repayment must be made.
The amounts pertaining to the other sub-categories are as follows: Election-
$180,000, Other Assessment Appeals - $682,594 and Miscellaneous - $575,486.
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APPENDIX B
RESERVE FOR SELF INSURANCE - G/L 4613
Actual Balance December 31, 2004
Transfers into the Reserve
$ 940,514
Transfers out of the Reserve:
Transfer to Capital
(25,000)
Pre-Audit Actual Balance December 31, 2005
$ 915,514
Purpose of this Reserve:
This reserve was established as a necessary form of asset protection.
Specifically, it is to cover insurance claims resulting from the increase in
deductible levels, costs of uninsured claims and other claim related costs. The
higher deductible reduced insurance premiums. Significant savings can be
realized through reduced premium costs and staff analyze the costs/benefits of
such actions on an annual basis.
The interest income on these funds form part of the annual Current Budget
General Government Revenue.
2. Recommended Maintenance Levels of this Reserve:
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This reserve should be maintained at a level to ensure that the funding is
adequate to meet future liabilities. This situation is analyzed by staff on a regular
basis. The $25,000 draw in the current year was necessary to partially pay for
the playground replacement costs resulted from vandalism.
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APPENDIX B
RESERVE FOR RATE STABILIZATION - G/L 4619
Actual Balance December 31, 2004 $ 2,619,565
Transfers into the Reserve
Excess Surplus Contribution 1 ,769,400
Transfers out of the Reserve
2005 Current Budget Provision (1,000,000)
Pre-Audit Actual Balance December 31, 2005 $ 3,388,965
1. Purpose of this Reserve:
The purpose of this reserve is to act as a tax rate stabilization factor for annual
current budget funding.
The interest income on these funds form part of the annual Current Budget
General Government Revenue.
2.
Recommended Maintenance Levels of this Reserve:
The fund balance should be maintained at a level of 3 to 5 per cent of tax
revenues to provide tax rate stabilization for annual current budgeting purposes.
The 2005 Current Budget provided for a transfer in the amount of $1,000,000
from this Reserve to fund current expenditures.
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APPENDIX B
RESERVE FOR DEVELOPMENT CHARGES - CITY SHARE G/L 4620
Actual Balance December 31, 2004
Transfers into the Reserve
2005 Current Budget Provision
Returned to source-completed project
$ 1,921,332
590,000
712
Transfers out of the Reserve
Transfer to Capital Fund
-External Subdivision Works
(2,027,840)
$ 484,204
Pre-Audit Actual Balance December 31, 2005
Purpose of this Reserve:
This reserve has been established to set aside funds for projected growth in the
City. From the 1999 and the 2004 Development Charges Studies it was
approved that a Reserve be established for the City's share (i.e. the non-
development charge portion) of the costs of services included in the
Development Charges Study and that contributions be included in the annual
Current Budget for consideration by Council. For the City to meet its obligations
for the various capital projects an annual contribution of $2.4 million is required.
The interest income on these funds form part of the annual Current Budget
General Government Revenue.
2. Recommended Maintenance Levels of this Reserve:
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Funds continue to be budgeted in the Current Budget to build up this reserve to
fund future capital growth of the City. The draws in the current year were to
finance external subdivision works. This reserve should be maintained at a level
to ensure that the funding is adequate to meet future capital growth in the City.
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APPENDIX B
REGION TRANSIT RESERVE - GIL 4621
Actual Balance December 31, 2004
Transfers into the Reserve
GO Transit Funding from Region
Transfer from Reserve Fund
Returned to source-project no longer require
$ 1,025,740
975,880
21,578
95,000 1,092,458
Transfers out of the Reserve
APT A Expenditures
(1,881,092)
$ 237,106
Pre-Audit Actual Balance December 31, 2005
1. Purpose of this Reserve:
This reserve fund was established in 2002 to capture funds raised by the Region
for transit purposes and not immediately required.
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The interest income on these funds form part of the annual Current Budget General
Government Revenue.
2. Recommended Maintenance Levels of this Reserve:
Transfer into the Reserve represents funding of $975,880 received from the
Region of Durham. Funds were transferred out of this reserve to finance the
2005 current and capital operations of Ajax Pickering Transit Authority (APT A).
The amount transferred-out in 2005 was $1,881,092 bringing the year-end
December 31,2005 balance to $237,106.
The balance of this Reserve is expected to be used for any unpaid commitments
or obligations related to APT A. With the transfer of APT A to the Region effective
January 1, 2006, this Reserve will eventually be closed-out upon settling all our
commitments and obligations.
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APPENDIX B
RESERVE FOR CONTINUING STUDIES & CONSULTING - G/L 4622
Actual Balance December 31, 2004 $ 233,159
Transfers into the Reserve
Continuing Consulting Work or Studies 250,599
Transfers out of the Reserve (141,225)
Pre-Audit Actual Balance December 31, 2005 $ 342,533
1.
Purpose of this Reserve:
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This reserve was established to capture any unspent annual Current Budget
provisions related to consulting, continuing studies, professional and legal fees.
Under Generally Accepted Accounting Principles, the approval to expend funds
for these efforts ceases at year-end, however work may continue beyond that
date. The establishment of this fund enables the transfer of unspent funds into
future year and accommodates this frequent timing difference between the
approval and the expenditure.
The interest income on these funds form part of the annual Current Budget General
Government Revenue.
2. Recommended Maintenance Levels of this Reserve:
There would be no recommended maintenance levels. Funds transferred to this
reserve will be used to fund the balance of the expenditures still to be incurred for
incomplete studies or consulting contracts.
Expenditures incurred in 2005 in the amount of $141,225 pertained to consulting
work that was transferred into the Reserve in the prior year. An additional
amount of $250,599 has been transferred-in for future work.
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APPENDIX B
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RESERVE FOR VEHICLE REPLACEMENT - G/L 4624
Actual Balance December 31, 2004
Transfers into the Reserve
$
25,000
50,000
Transfers out of the Reserve
$
75,000
Pre-Audit Actual Balance December 31, 2005
1. Purpose of this Reserve:
This reserve was newly established in 2004 to begin building up funds to finance
the cost of replacing the City's aging fleet.
The interest income on these funds form part of the annual Current Budget General
Government Revenue.
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2. Recommended Maintenance Levels of this Reserve:
There would be no recommended maintenance levels. Funds transferred to this
reserve will be committed to fund the purchase of new vehicles.
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APPENDIX B
EASEMENT SETTLEMENT RESERVE - GIL 4625
Actual Balance December 31, 2004
Transfers into the Reserve
$
2,500,000
Transfers out of the Reserve:
2005 Capital Budget Expenditures
2005 Current Budget Expenditures
(969,534)
(435,337) (1,404,871)
$ 1,095,129
Pre-Audit Actual Balance December 31, 2005
1. Purpose of this Reserve:
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2.
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This reserve was newly established in 2005 due to funds received from
easement settlement in February 2005. The amount collected was $2.5 million.
These funds will be used finance both the capital and operating expenditures of
the City. The 2005 expenditures included a draw of $969,534 to fund capital
expenditures and $435,337 to fund current expenditures, providing a year-end
balance of $1,095,129.
The interest income on these funds form part of the annual Current Budget General
Government Revenue.
Recommended Maintenance Levels of this Reserve:
There would be no recommended maintenance levels. Whenever funds are
received due to easement settlement, this reserve will be credited accordingly.
Budgeted draws to fund City's expenditures will be dependent on the revenues
collected.
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APPENDIX B
RESERVE - PROVISION FOR EASTERN BRANCH LIBRARY - G/L 4626
Actual Balance December 31, 2004
Transfers into the Reserve
$
20,000
Transfers out of the Reserve
Pre-Audit Actual Balance December 31, 2005
$
20,000
1. Purpose of this Reserve:
This reserve was newly established in 2005 to begin building up funds for a new
library at the eastern part of Pickering. This provision may be used to fund the
new facility, capital cost, resource materials and any other related costs.
The interest income on these funds form part of the annual Current Budget General
Government Revenue.
2.
Recommended Maintenance Levels of this Reserve:
There would be no recommended maintenance levels. In 2002, the Board of the
Library requested $10,000 under the Capital Budget for the "Provision for
Eastern Branch". A similar request was made in 2005. The combined total of
2002 and 2005 is reflected in the year-end balance. It is the intention of the
Board of the Library to annually request for this provision to continue building up
funds for the proposed new facility. To reflect this intention, effective 2006
Budget year, the provision will be done by a "Transfer to Reserve for the
Provision for Eastern Branch".
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ATTACHMENT #-=L.. TO REPORT#CS. :39 "d~
APPENDIX C
RESERVE FUND FOR COMMUNITY FACILITIES - G/L 4225
Actual Balance December 31, 2004 $ 380,604
Transfers into the Reserve Fund
Capital Fund - Returned to Source $ 61 ,220
Interest Earned on External Investments 11 , 153 72,373
Transfers out of the Reserve Fund
Transfer to Capital Fund - Museum (187,485)
Pre-Audit Actual Balance December 31, 2005 $ 265,492
1. Purpose of this Reserve:
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2.
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This is a "discretionary" reserve fund established by Council to attempt to avoid
both tax rate fluctuations and the need for issuing long term debt for major
expenditures required for community facilities.
The interest income on these funds form part of the Reserve Fund as per the
Municipal Act, 2001.
Recommended Maintenance Levels of this Reserve:
The balances in this fund have fluctuated from the 2001 year low of $69,102 to
the high in 1998 of $773,483. Other than interest income earned and funds
returned from projects no longer required, there was no transfer to this reserve
fund in 2005.
Expenditures are transferred out of Reserve Funds only when incurred; therefore
the amount committed but not incurred at end of 2005 is $25,000. Taking these
commitments into consideration, the uncommitted balance of funds available is
$240,492. Additional amounts must be provided to this fund.
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APPENDIX C
RESERVE FUND FOR DEVELOPMENT CHARGES - G/L 4227/4229
Actual Balance December 31, 2004
Transfers into the Reserve Fund:
Net Developer Contributions
Returned to source
Interest Earned on External Investments
Interest Earned on Internal Loans
$ 19,496,777
$ 1,672,209
17,266
420,714
215,648 2,325,837
Transfers out of the Reserve Fund:
Transfer to Revenue Fund - Develop. Charge Study
Transfer to Capital Fund:
External Subdivision Works
Sidewalks
Senior Centre
(3,979)
$ (676,893)
(2,814)
(3,622)
(687,308)
Pre-Audit Actual Balance December 31, 2005
$ 21,135,306
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1.
Purpose of this Reserve:
This is an "obligatory" reserve fund and as such is governed by Municipal Act
2001, Development Charges Act, 1997, Ontario Regulation 82/98, City By-law or
agreement and requires revenue received for the special purposes to be
segregated from the general revenues of the municipality. Obligatory Reserve
Funds must be created whenever a statute requires revenue received for a
special purpose to be segregated from the general revenues of the municipality
and the revenue is to be used solely for the purpose prescribed by statute, i.e. in
this case the monies charged to developers must be held and used to fund
capital services required for new growth.
The interest income on these funds form part of the Reserve Fund as per the
Municipal Act, 2001.
2. Recommended Maintenance Levels of this Reserve:
In accordance with development charge legislation, all development charge
revenue must be held within separate Reserve Funds and can only be used for
the financing of growth-related projects. As such, no reserve fund limits are
appropriate for Development Charge Reserve Funds because they are tied to
growth-related capital requirements.
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This reserve fund has unspent commitments of $3,583,520. The pre-audit actual
balance of $21,135,306 would be reduced by this amount to reflect an
uncommitted balance of funds available of $17,551,786.
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APPENDIX C
RESERVE FUND FOR CAPITAL WORKS - G/L 4228
Actual Balance December 31, 2004
Transfers into the Reserve Fund
Interest Earned on External Investments
$ 302,610
7,262
Transfers out of the Reserve Fund
Pre-Audit Actual Balance December 31, 2005
$ 309,872
1.
Purpose of this Reserve:
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This Fund is a "discretionary" one and was established pursuant to section
417(1 )(2) of the Municipal Act, 2001 for specified purposes by Council related to
the acquisition of assets.
The interest income on these funds form part of the Reserve Fund as per the
Municipal Act, 2001.
2. Recommended Maintenance Levels of this Reserve Fund:
Between the years of 1998 to 2000, the balances have been maintained at
$600,000 to $800,000. There has been no major contribution to this Reserve
Fund in the past four years. The value of the unspent commitments at the end of
2005 is $13,822. Taking these unspent commitments into account, the
uncommitted balance available at December 31, 2005 will be $296,050. Major
additional contributions will be required in future years.
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APPENDIX C
RESERVE FUND FOR PARKLAND - GIL 4230
Actual Balance December 31, 2004
Transfers into the Reserve Fund
Developers Contributions
Returned to source
Interest Earned on External Investments
Interest Earned on Internal Loans
$ 2,166,696
$
256,333
176,721
54,441
22,811
510,306
Transfers out of the Reserve Fund
Transfer to Capital Fund
Parks-Tennis Court Resurfacing
Parks-Clubhouses
Playground Equipment
Parks-Purchase of land
Pre-Audit Actual Balance December 31, 2005
$
(94,322)
(20,156)
(259,463)
(200,000)
(573,941 )
$ 2,103,061
Purpose of this Reserve Fund:
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This is an "obligatory" reserve fund and it was established pursuant to section
417(1 )(2) of the Municipal Act, 2001 as required by subsections 42(1), (5), (6),
(7), (8) and (9) of the Planning Act. This fund is governed by legislation,
regulation or agreement and requires revenues received for the special purposes
to be segregated from the general revenues of the municipality. Obligatory
Reserve Funds must be created whenever a statute requires revenues for a
special purpose to be segregated from the general revenues of the municipality
and the revenue is to be used solely for the purpose prescribed by statute.
The interest income on these funds form part of the Reserve Fund as per the
Municipal Act, 2001.
2. Recommended Maintenance Levels of this Reserve Fund:
Due to the obligatory nature of this fund, there are no limits on this fund. The
value of the unspent commitments at end of 2005 is $202,031. The pre-audit
balance of $2,103,061, taking into account the unspent commitments, will
provide an uncommitted balance available of $1,901,030 as at December 31,
2005.
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APPENDIX C
RESERVE FUND FOR PUBLIC WORKS - G/L 4232
Actual Balance December 31, 2004
Transfers into the Reserve Fund
Developer Contributions
Interest Earned on External Investments
$ 1,152,444
$
8,297
31,607 39,904
Transfers out of the Reserve Fund
Transfer to Capital Fund -
Property Maintenance
Roads
(9,161 )
(144,981 )
(154,142)
Pre-Audit Actual Balance December 31, 2005
$ 1 ,038,206
Purpose of this Reserve Fund:
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This fund was established by Council pursuant to section 417(1 )(2) of the
Municipal Act, 2001. The purpose of the reserve fund is to acquire fixed assets,
e.g. storm sewers, without the need to fund on a long term nature through the
issue of debentures. The main purpose at this time is to fund the City's share of
the cost of subdivision works committed to under various subdivision
agreements.
The interest income on these funds form part of the Reserve Fund as per the
Municipal Act, 2001.
2. Recommended Maintenance Levels of this Reserve Fund:
The "average" annual balance of this fund over the last four years has been
approximately $1.38 million. This reserve fund should be kept at least at this
level in the future. Staff will periodically review the need for this level with the
requirements contained in the capital budget and four year program and report
any different findings to Council.
The value of unspent commitments for 2005 is $114,916. The pre-audit balance
of $1,038,206 after taking into account the unspent commitments will provide an
uncommitted balance of funds available at $923,290 as at Dec. 31,2005.
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APPENDIX C
RESERVE FUND FOR WORKERS SAFETY INSURANCE BOARD - G/L 4234
Actual Balance December 31, 2004 $ 378,731
Transfers into the Reserve Fund
Contribution from Current Fund $ 365,296
Interest Earned on External Investments 18,602 383,898
Transfers out of the Reserve Fund
Claims and Other Related Costs $ (61,400)
Insurance Costs (106,082)
Contribution to Health & Safety Program (5,572) (173,054)
Pre-Audit Actual Balance December 31, 2005 $ 589,575
1.
Purpose of this Reserve Fund:
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This Reserve Fund has been established to provide for the annual costs of
insurance coverage, contributions towards the health and safety program, and
the payment of claims and other related costs now that the City is a Schedule 2
employer. This Reserve Fund was created in 2001 further to the
recommendation passed in Council Resolution#127/01 and in compliance with
Workplace Safety & Insurance Act.
The interest income on these funds form part of the Reserve Fund as per the
Municipal Act, 2001.
2. Recommended Maintenance Levels of this Reserve Fund:
In both 2004 and 2005, the contributions were more than double the claims
experience for the year, thus resulting to a built-up in the balance of the Reserve
Fund.
As Schedule 2 operates on the self-insured principle, any anticipated savings
between contributions and claims experience will be transferred to this Reserve
Fund to build up the fund balance in the event of any catastrophic claim-related
costs, which may occur. The average annual built-up of approximately $196,000
from 2003 to 2005 has resulted to the 2005 year-end balance of $589,575.
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APPENDIX C
THIRD PARTY/DEVELOPERS CONTRIBUTIONS RESERVE FUND - GIL 4235
Actual Balance December 31, 2004
Transfers into the Reserve Fund
Contributions from Developers/Third Parties
Interest Earned on External Investments
$ 1,601,076
$ 176,291
41,897 218,188
Transfers out of the Reserve Fund
Pre-Audit Actual Balance December 31, 2005
$ 1,819,264
Purpose of this Reserve Fund:
This reserve fund was established by Council pursuant to Section 417(1) of the
Municipal Act, 2001. The purpose of this reserve fund is to capture contributions
from developers or third parties per development agreements or cost sharing
arrangements for future capital projects.
Due to the externally restricted contributions, this Reserve Fund is treated as
obligatory. The collections are committed for a specific purpose and not
available for general use. Unless specified, the City is under no obligation to pay
interest to any developers or third parties.
The interest income on these funds form part of the Reserve Fund as per the
Municipal Act, 2001.
2. Recommended Maintenance Levels of this Reserve
_c
No reserve fund limits are appropriate for this fund as collection and commitment
of funds are dependent upon development agreements or cost sharing
arrangements.
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APPENDIX C
ONTARIO TRANSIT RENEWAL RESERVE FUND - GIL 4236
Actual Balance December 31, 2004 $ 14,035
Transfers into the Reserve Fund
Contribution from Ministry of Transportation $ 162,279
Interest on External Investments-reversal 5,130 167,409
Transfers out of the Reserve Fund
APT A Capital Expenditures (140,700)
Transfer to Region Transit Reserve (21,578) (162,278)
Pre Audit Actual Balance December 31, 2005 $ 19,166
1.
Purpose of this Reserve Fund:
-
This is an "obligatory" Reserve Fund established to capture funding received
from Ministry of Transportation for the sole purpose of funding acquisition of
APT A vehicles or for any major vehicle refurbishment.
The interest income on these funds form part of the Reserve Fund as per the
Municipal Act, 2001.
Recommended Maintenance Levels of this Reserve Fund:
No reserve fund limits are appropriate for this fund as availability of funds is
dependent on the amount of grant received.
The amount of $162,279 received from the Ministry of Transportation represents
City of Pickering's share of the grant under the Ontario Transit Renewal
Program.
Funds are provided from the Ontario Transit Renewal Program as expenditures
are incurred. With the transfer of APT A to the Region of Durham effective
January 1, 2006, this reserve fund will eventually be closed-out upon resolving all
outstanding matters. Note that the balance of $19,166 is a pre-audit amount
pending journal entries from year-end audit and thus, not the official 2005 year-
end balance.
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APPENDIX C
SQUASH COURTS RESERVE FUND - G'L 4237
Actual Balance December 31, 2004 $ 33,713
Transfers into the Reserve Fund
Surcharge on rv1emberships 30,150
I nterest on Extemallnvestments 2,224 32,374
Transfers out of the Reserve Fund
Pre Audit Actual Balance December 31, 2004 $ 66,087
1.
Purpose of this Reserve Fund:
This Reserve Fund was established to capture funds from Pickering
Squash Club memberships' surcharges, corporate sponsorships, third
party contribution and any such funds as the Council may approve. This
Reserve Fund shall be used for the purpose of paying expenses related to
the provision of double squash courts. This Reserve Fund was newly
created in 2003 further to the recommendation passed in Council
Resolution #79/03, Item 5 per Report to Council CS 40-03.
The interest income on these funds form part of the Reserve Fund as per
the Municipal Act, 2001.
Recommended Maintenance Levels of this Reserve Fund:
-
No reserve fund limits are appropriate for this fund.
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APPENDIX C
PROVINCIAL DEDICATED GAS TAX RESERVE FUND - GIL 4238
Actual Balance December 31, 2004 $ 161,515
Transfers into the Reserve Fund
Provo of Ontario 705,264
Interest on External Investments 16,774 722,038
Transfers out of the Reserve Fund (161,515)
Pre Audit Actual Balance December 31, 2005 $ 722,038
1.
Purpose of this Reserve Fund:
-
This Reserve Fund was established to capture funds from the Province of
Ontario for the new provincial gas tax revenue program. This Reserve
Fund shall be used for the purpose of paying eligible public transportation
expenditures, to offset Pickering's share of the costs for funding the Ajax
Pickering Transit Authority (APT A). This Reserve Fund was newly created
in 2004 further to the recommendation passed in Council Resolution
#167/04, Item 3 at the Council Meeting of December 20, 2004 per Report
to Council CS 56-04.
The interest income on these funds form part of the Reserve Fund as per
the Municipal Act, 2001.
2. Recommended Maintenance Levels of this Reserve Fund:
No reserve fund limits are appropriate for this fund. Under this program,
the provincial government will provide one cent a litre of the provincial gas
tax funding in 2004. This rate has been increased to 1.5 cents in 2005 and
will be increased to two cents in 2006.
As the purpose for providing this Fund is for the public transportation
services, with the transfer of APTA to the Region effective 2006, the
balance of this Fund will be transferred to the Region once all matters are
resolved.
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APPENDIX C
FEDERAL DEDICATED GAS TAX RESERVE FUND - GlL 4239
Actual Balance December 31, 2004
Transfers into the Reserve Fund
Provo of Ontario
Interest on External Investments
$
849,577
1 ,107 850,684
Transfers out of the Reserve Fund
Pre Audit Actual Balance December 31, 2005
$ 850,684
1.
Purpose of this Reserve Fund:
This Reserve Fund was established in 2005 to capture the transfer of gas
tax revenues from the Government of Canada through the Association of
Municipalities of Ontario under the New Deal for Cities and Communities.
The Council had approved under Report to Council CS 92-05, the
establishment of this new Reserve Fund under By-law 6609/05 and
Resolution 219/05. This new program is not application based and does
not require matching funding. Municipalities are allowed to invest in
environmental sustainable infrastructure in programs such as public
transit, storm water system, local roads and bridges.
The interest income on these funds form part of the Reserve Fund as per
the Municipal Act, 2001.
2. Recommended Maintenance Levels of this Reserve Fund:
~.
No reserve fund limits are appropriate for this fund. Under the Municipal
Funding Agreement, the schedule of funding payments is as follows:
Year July November
2005 $ 849,577.58
2006 $424,788.79 424,788.79
2007 566,321.81 566,321.82
2008 707,854.83 707,854.84
2009 1,415,709.67 1,415,709.67
Total $7,078,927.80
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APPENDIX C
BlJLDlNG PERMT STABlUZAllON RESERVE RJND
(Ißveloprrent Appliætions Approvals Prcœss (OAAP) Fees)
Actual Balance DecenDer 31, 2004
Transfers into the ReseNe Fund
Building Code pemit Fees
Interest on Externallnvestrrents
$
Transfers out of the ReseNe Fund
Pre Audit Actual Balance DecenDer 31, 2005
$
1.
Purpose of this Reserve Fund:
This Reserve Fund will be officially established in 2006 based on By-Law
6651/06. However, the Report to Executive Committee PD 41-05 was
forwarded to Council on December 1, 2005 such that the by-law will be
made effective January 1,2006. Thus, this Reserve Fund will have a zero
balance as at year-end 2005. This reports provides the background
information for this new Reserve Fund.
The need for the establishment of this Reserve Fund arises as a result of
the significant changes to the building regulatory system in Ontario with
the introduction of the Building Code Statute Law Amendment Act, 2002
(known as Bill 124) and associated amendments to the Ontario Building
Code. The purpose of this fund is to secure funding to provide for service
delivery stabilization during an economic downturn. The source of funds
will be an annual portion of building code permit fees after related direct
and indirect costs are netted as defined and or adjusted by the Treasurer.
The interest income on these funds form part of the Reserve Fund as per
the Municipal Act, 2001.
2.
Recommended Maintenance Levels of this Reserve Fund:
Given the rationale for creating a fee stabilization reserve fund, the
targeted reserve fund balance should reflect the reduction in permits
witnessed during the last recession when compared to the long-run
development average - acknowledging the City's responsibility to manage
a portion of the costs associated with an economic downturn. Based on
the modeled activity based direct costs conducted by CN Watson; this
translates into a target balance of approximately $1.16 million (1.13 years
of direct operating cost).