HomeMy WebLinkAboutFIN 06-20Cly 4
DICKERING
Report to
Council
Report Number: FIN 06-20
Date: May 25, 2020
From: Stan Karwowski
Director, Finance & Treasurer
Subject: Development Charges Reserve Fund — Statement of the Treasurer for the
Year Ended December 31, 2019
Recommendation:
That Report FIN 06-20 of the Director, Finance & Treasurer regarding the Development
Charges Reserve Fund be received for information.
Executive Summary: Section 43 of the Development Charges Act, 1997 (the "Act")
requires that the Treasurer provides Council with a financial statement relating to the
development charges by-law and reserve fund established for each service as
established under Section 33 of the Act.
On December 3, 2015, the Province passed Bill 73 which amended the Act to add
additional reporting requirements. The Treasurer's Statement (Statement) attached to
this report has been expanded to comply with the new reporting requirements.
Attachment 1 provides details of the activity of the Development Charges Reserve Fund
for the year ended December 31, 2019 in the manner prescribed by section 43(2)(a) of
the Act. Attachment 2 provides details on information related to assets funded by the
development charges by-law as stipulated by section 43(2) (b) of the amended Act.
The amended Act introduced a new section: 43(2.1), which now requires Council to
ensure that the Statement is made available to the public. The Statement will be posted
on the City's website to facilitate compliance with the amendment.
Financial Implications: During the three-year period from 2017 to 2019,
development charges collected were approximately $5.3 million in 2017, $13 million in
2018, and $7.73 million in 2019. There was a decrease of 45 percent in the 2019
development charges collected compared to the 2018 collections, however, the 2019
collections are still higher than those collected in 2017. The ongoing development in the
Duffin Heights neighbourhood, and the new development in the Seaton lands were the
main contributors to the development charges collected in 2019. The spike in the 2018
collections was an exception; largely due to a number of medium density multiple
residential developments in the urban area of Pickering, and the non-residential
development related to Durham Live.
FIN 06-20 May 25, 2020
Subject: Development Charges Reserve Fund — Statement of the Page 2
Treasurer for the Year Ended December 31, 2019
The reserve fund remains at a healthy balance of approximately $62.5 million pending
future use of funds for qualified projects. The funds are well managed with investment
returns consistently exceeding market indicators. Investment income is added to the
balance of each fund as such income is earned.
Attachment 1 provides a breakdown of the various DC service categories. Two of the
service categories are in a negative position due to planned budget activity: DC funding
for a new operations centre and a new financial system. Negative balances will be
addressed through DC fees collected from current growth related activity and through
the next DC Study. For the next DC study, credit balances are treated as a cost that will
be recovered through higher DC rates.
Discussion: Funds are not transferred out of the Development Charges Reserve
Fund for projects until the funds are actually needed, as required by applicable
accounting rules. This ensures that the reserve fund continues to earn interest income
on the unspent monies until such time as actual expenses are incurred.
The total reserve fund balance of $62.5 million represented in Attachment 1 represents
the unspent monies as at December 31, 2019. Please note that there are approximately
$27.1 million of committed capital projects and financial obligation that have been
approved in prior years, but have not proceeded or are still ongoing as at December 31,
2019. Taking into account these commitments, the net fund balance available for future
expenditures is approximately $35 million.
The financial obligation refers the development charges debenture financing undertaken
for the construction of the new Operations Centre, at $12.1 million, which includes
principle and interest payments. This amount is outstanding for the remaining period of
2020-2037. This amount represents approximately 45 percent of the commitments of
$27.1 million.
In order to meet the new requirement under section 43(2.1) of the amended Act, it is
recommended that the Statement be placed on the City's website upon approval by
Council.
Attachments:
1. Pre -audit 2019 Statement of the Treasurer — Development Charges Reserve Fund
2. Amount Transferred to Assets — Capital & Current Funds Transactions (Pre -Audit)
FIN 06-20 May 25, 2020
Subject: Development Charges Reserve Fund — Statement of the Page 3
Treasurer for the Year Ended December 31, 2019
Prepared By:
Caryn Kong, CPA, CGA
Senior Financial Analyst
Debt Management
Capital &
Approved/Endorsed By:
Stan Karwowski, CPA, CMA, MBA
Director, Finance & Treasurer
Recommended for the consideration
of Pickering City Qouncii
(.) 4*6e ZIPZD
Tony Prevedel, P.Eng.
Chief Administrative Officer
Attachment #1 to Report #FIN 06-20
City of Pickering
Pre -Audit 2019 Statement of the Treasurer - Development Charges (DC) Reserve Fund
for the Year Ended December 31, 2019
DC Act S 43 (2)(a)
Notes:
' See Attachment 2 for details
2 Budget commitments include capital projects previously approved, but have not proceeded or still ongoing. 2019 & Prior Commitments
3New Operations Ctr outstanding debt charges from 2020-2037. Total amount owing $12,184,847, allocated in the ratio of 61 % "Other Services Related to a Highway" and 39% "Parks & Recreation"
4. New Operations Ctr DC debt charges- 2019 payment of $676,048, allocated 61% to "Other Services Related to a Highway" $412,389 and 39% $263,659 to "Parks & Recreations"
5' Adjustment to 2018 debt charges, on which 100% was allocated to "Other Services related to Highway". Per 2018 DC Study: 61% to "Other Services Related to a Highway" and 39% to "Parks & Recreation"
The Municipality is compliant with s.s.59.1(1) of the Development Charges Act, whereby charges are not directly or indirectly imposed on development nor has a requirement to
construct a service related to development been imposed, except as permitted by the Development Charges Act or another Act.
Services to which the Development Charges Relates
100% Recovery (Non -Discounted)
10% Statutory Deduction (Discounted)
Account
7605
7610
7615
7611
7601
7622
7630
Protective
Other Services
Storm Water
Parks &
Library:
Description
Services
Transportation
Related to a
Highway
Mgmt
Studies
Recreation
Facilities &
Materials
Total
$
$
$
$
$
$
$
$
Opening Balance, January 1, 2019
2,225,617
27,702,614
82,198
3,154,525
(184,512)
21,805,122
4,003,852
58,789,415
Plus:
Development Charges Collections
743,641
2,108,082
363,688
236,843
231,723
3,031,479
671,088
7,386,544
Interest Income -Internal Investment
1,859
23,138
69
2,635
0
18,213
3,344
49,257
Interest Income -External Investment
48,321
601,455
1,785
68,488
0
473,414
86,928
1,280,391
Less Admin Fee
(2,315)
(28,813)
(85)
(3,281)
0
(22,679)
(4,164)
(61,338)
Sub -Total
791,505
2,703,863
365,456
304,685
231,723
3,500,426
757,196
8,654,854
Less:
2019 Transfer to Capital Funds'
(866,883)
(964,083)
(667,843)
(810,306)
(350,865)
(217,449)
(3,877,428)
2019 Transfer to Current Funds'
0
0
(412,389) 4
0
(292,539)
(263,659)4
0
(968,586)
Sub -Total 2019
(866,883)
(964,083)
(1,080,232) o
0
(1,102,844)
(614,524)
(217,449)
(4,846,014)
Opr Ctr Debt Chrgs-Adjustment to 2018 Transfer to
Current Funds, allocate 39% from "Other Services
Related to a Highway" to "Parks & Recreation"
262,043 5
(262,043) 5
0
Sub -Total
(866,883)
(964,083)
(818,189)
0
(1,102,844)
(876,567)
(217,449)
(4,846,014)
Closing Balance, December 31, 2019
before Budget Commitments
2,150,240
29,442,394
(370,535)
3,459,209
(1,055,633)
24,428,981
4,543,599
62,598,255
Less Budget Commitments 2
(2,208,950)
(4,868,847)
0
(3,632,977)
(1,568,231)
(2,410,659)
(270,443)
(14,960,108)
Less New Operations Ctr Debt Charges
Commitment 2020-2037
0
0
(7,457,052) 3
0
0
(4,727,795) 3
0
(12,184,847)
Sub -Total
(2,208,950)
(4,868,847)
(7,457,052)
(3,632,977)
(1,568,231)
(7,138,455)
(270,443)
(27,144,954)
Closing Balance, December 31, 2019 after
Budget Commitments -(Deficit)
(58,711)
24,573,547
(7,827,587)
1,250,259
(2,623,864)
17,290,527
4,273,156
35,453,301
Notes:
' See Attachment 2 for details
2 Budget commitments include capital projects previously approved, but have not proceeded or still ongoing. 2019 & Prior Commitments
3New Operations Ctr outstanding debt charges from 2020-2037. Total amount owing $12,184,847, allocated in the ratio of 61 % "Other Services Related to a Highway" and 39% "Parks & Recreation"
4. New Operations Ctr DC debt charges- 2019 payment of $676,048, allocated 61% to "Other Services Related to a Highway" $412,389 and 39% $263,659 to "Parks & Recreations"
5' Adjustment to 2018 debt charges, on which 100% was allocated to "Other Services related to Highway". Per 2018 DC Study: 61% to "Other Services Related to a Highway" and 39% to "Parks & Recreation"
The Municipality is compliant with s.s.59.1(1) of the Development Charges Act, whereby charges are not directly or indirectly imposed on development nor has a requirement to
construct a service related to development been imposed, except as permitted by the Development Charges Act or another Act.
RFs
7601
7601
7601
7601
7601
7601
7601
7601
7601
7601
7605
7605
7605
7605
7610
7610
7610
7610
7610
7610
7610
7610
7610
7610
7610
7610
7610
7611
City of Pickering
Amount Transferred to Assets - Capital & Current Fund Transactions (Pre -Audit)
for the Year Ended December 31, 2019
Attachment #2 to Report #FIN 06-20
DC Act S 43 (2)(b)
1 of 2
DC Recoverable Cost Share
Non - DC Recoverable Cost Share
Project
Description Code
Gross
Capital
Costs
DC RF:
Funded in
prior year
DC RF:
Funded in
2019
DC RF:
Future
Funding 1
Other Type of Funds
Reserves/R (R=Reserve,
eserve RF=Reserve Property
Funds Fund) Taxes
Other
Sources Type
Total Funding
Development Related Studies
Phase 2 South Pickering Intensificatior 2611.2392
222,704
86,488
76,086
0
60,130
222,704
Integrated Transportation Master Plan 2290.2392
376,892
171,359
110,785
59,856
34,892
376,892
Beachfront Park Rehab & Needs
Assessment 2290.2392
56,355
0
7,233
30,807
18,315
56,355
Age Friendly Community Plan 2711.2392
50,849
15,318
4,513
0
31,018
50,849
New Financial System 5203.1801.
5,000,000
7,321
810,306
1,138,873
1,743,500 R -Rate Stabilization
1,300,000 R -Financial Syst
5,000,000
Infill & Replacement Housing in Establi 2611.2392
132,970
7,677
26,494
25,666
73,133
132,970
Wayfinding Study for POC, PRC, & Cis. 2711.2392.
45,497
0
13,914
3,830
27,753
45,497
Community Engagm on Economic imp( 2611.2392
134,753
38,150
14,205
0
0.00
82,399
134,753
DC Background Study Amendments 2127.2392
31,411
0
28,270
0
3,141
31,411
City Centre SWM Strategy 2613.2392
249,156
0
11,039
213,201
24,915.60 R -City's Share
0
249,156
Sub -total Studies
6,300,587
326,313
1,102,844
1,472,232
1,768,416 -
330,782
1,300,000 0
6,300,587
Protective Services
0
New Fire Hall to service Seaton - Site 15340.1601
430,000
76,781
342,469
10,750 R -DC City's Share
430,000
New - Pumper Rescue - Seaton Fire SI 5340.1707.
891,922
147,174
700,152
0
44,596 RF -3rd Party Contribution OPG
891,922
Bunker Gear & Breathing Apparatus E( 5340.1901.
126,209
60,491
65,718
126,209
#3)Re-design - Design and other
consulting fees for new fire station 5340.1907.
445,000
0
106,240
327,635
11,125 R -City's Share
445,000
Sub -total Fire Services
1,893,131
223,955
866,883
735,822
66,471
1,893,131
Transportation
DH-3Tillings Road - Valley Farm Road 5321.1001.
255,065
134,570
94,989
0
25,506 R -city's Share
0
0 0
255,065
BR -1 Third Concession Road - Brock F 5321.1101.
1,576,525
117,844
0
276,931
374,750 RF-FGT
1,000
806,000 Debt 15 -Yr
1,576,525
DH -12 - Old Taunton Road (William Ja 5321.1104.
357,336
262,390
59,213
35,734 R -City's Share
357,336
BR -4 Brock Rd. East Side (50/50) Dell 5321.1203.
239,314
71,000
2,149
46,508
119,657 R -City's Share
239,314
DH -11 Duffin Heights - North Collector 5321.1201.
125,600
29,460
83,580
12,560 R -City's Share
125,600
Park Crescent (Sandcastle Court to Cli 5321.1303.
1,000,900
396,758
103,692
0
500,450 R -City's Share
1,000,900
W-2 Cliffview Rd. (50/50%) - Park Cre 5321.1304.
306,250
125,135
27,991
0
153,125 R -city's Share
306,250
Park Crescent - Road Reconstruction - 5321.1601.
613,912
243,545
63,411
0
306,956 R -City's Share
613,912
RU -13 Salem Road - Road Reconstruc 5321.1608.
1,409,959
329,586
297,576
77,818
0
4,979
700,000 Debt 10 -Yr
1,409,959
B-29 Sandy Beach Road - EA, Design 5321.1609.
675,000
104,506
44,267
188,727
37,500 R-AIP
300,000 Loan 10- Yr
675,000
Walnut Lane Extension Study & EA an 5321.1703.
461,226
103,528
61,036
181,355
115,307 R -City's Share
461,226
WO -3 Kingston Road Sidewalks & Strt 5321.1805.
250,671
0
125,335
0
125,335 R -City's Share
250,671
Salem Rd. - Final Lift of Asphalt - Sala 5321.1907.
200,174
0
84,425
15,662
100,087 R -City's Share
200,174
City Dev Projects-DCRF only committe 5321.0000.
8,954,283
0
8,954,283
0
8,954,283
Sub -total Transportation
16,426,216
1,918,323
964,083
9,824,864
1,906,967
5,979
1,806,000
16,426,216
Stormwater Management
B-20 D Krosno Creek SWM Facility Design 5321.1802.
965,400
0
463,392
502,008 R-Citys Share
965,400
Sub -total Stormwater Management
965,400
0
0
463,392
502,008
965,400
1 of 2
RFs
7615
7615
7615
7622
7622
7622
7622
7622
7622
7622
7622
7622
7622
7622
7630
City of Pickering
Amount Transferred to Assets - Capital & Current Fund Transactions (Pre -Audit)
for the Year Ended December 31, 2019
DC Act S 43 (2)(b)
1
Projects ongoing. Future funding for incomplete component. DC RF will be drawn when expenses are incurred.
2 New Operations Ctr 20 -year DC debt -principal & interest of $13,532,799. Allocation: 61% for 7615 -"Other Services Related to a Highway' & 39% for 7622- "Parks & Recreation". Total amount owing from 2020- 2037 $12,184,847
3 The Pickering Heritage & Community Centre is treated as one capital project. In order to show the two DCs service categories, the components related to the Community Centre and Library are presented separately.
2 of 2
DC Recoverable Cost Share
Non - DC Recoverable Cost Share
Project
Description Code
Gross
Capital
Costs
DC RF:
Funded in
prior year
DC RF:
Funded in
2019
DC RF:
Future
Funding 1
Other Type of Funds
Reserves/R (R=Reserve,
eserve RF=Reserve Property
Funds Fund) Taxes
Other
Sources Type
Total Funding
Other Services Related to a Highway
4 Ton Dump Truck with Snow Plow - N 5319.1805
248,188
0
248,188
0
0
248,188
Additional Street Sweeper (Seaton) - h 5319.1809
288,403
0
288,403
0
0
288,403
Garbage Packer - New 5780.1813
145,835
131,251
0
14,583 R -City's Share
145,835
New operations centre-uebt charges
61% of total debt charges 1920.7600.:
8,279,302
409,861
412,389
7,457,052 2
0
8,279,302
Sub -total
8,961,728
409,861
1,080,232
7,457,052
14,583
8,961,728
Parks & Recreation Services
Village Green - Mattamy (Seaton) Dev. 5780.1723.
246,514
174,821
40,879
0
30,814.28 RF -Seaton Infrastructure
246,514
D.H. Village Green Park (East) - New - 5780.1708.
190,000
0
166,725
23,275.00
190,000
Indoor Soccer Facility and Land - Desi 5719.1401.
7,296,605
3,369,586
114,543
78,375 R-DCs City's Sh
101
3,734,000 Debt 15 -Yr 2
7,296,605
Duffin Heights Neighbourhood Park Cc 5780.1808.
600,000
18,350
508,150
73,500 R-DCs City's Share
600,000
Rotary Frenchman's Bay West Park Pt 5780.1822.
2,091,761
839,890
2,644
35,758
1,073,469 R-DCs City's Share
140,000 Other Agency -S\
2,091,762
Brock Ridge Village Green Constructio 5780.1810.
262,433
0
230,941
0
6,767 R-DCs City's Share
24,725 Landowner
262,433
Seaton (P103) Village Green Construc 5780.1816
210,000
0
0
184,275
25,725 RF -FIA
210,000
Seaton (P104) Village Green Construc 5780.1817
285,000
250,087
34,913 RF -FIA
285,000
Seaton (P-102) Neighbourhood Park C 5780.1819
950,000
833,625
116,375 RF -FIA
950,000
Pickering Heritage & Community Ctr
(Design) -Community Ctr component 5719.1806.
891,814
22,191
76,401
100,192 3
693,030 R -Rate Stabilization
891,814
New Operations Centre - DC Debt
Charges. 39% Construction of a new 1920.7600.
5,253,497
262,043
263,659
4,727,795 2
-
5,253,497
Sub -total
18,277,624
4,686,882
614,524
6,921,150
2,156,243
101
3,898,725
18,277,624
Library Facilites & Materials
Pickering Heritage & Community Ctr
(Design) -Archive Facility component 5719.1806.
611,965
63,160
217,449
270,443 3
60,914 R-DCs City's Share
611,965
Sub -total
611,965
63,160
217,449
270,443
60,914
611,965
Grand Total
53,436,652
7,628,494
4,846,014
27,144,955
6,475,602
336,862
7,004,725
53,436,652
1
Projects ongoing. Future funding for incomplete component. DC RF will be drawn when expenses are incurred.
2 New Operations Ctr 20 -year DC debt -principal & interest of $13,532,799. Allocation: 61% for 7615 -"Other Services Related to a Highway' & 39% for 7622- "Parks & Recreation". Total amount owing from 2020- 2037 $12,184,847
3 The Pickering Heritage & Community Centre is treated as one capital project. In order to show the two DCs service categories, the components related to the Community Centre and Library are presented separately.
2 of 2