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Finance Department
Report
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Report To: Joint General Government and Planning and Development Committees
Date of Meeting: January 7, 2019
Report Number: FND-001-19 Resolution: JC -070-19
File Number: By-law Number:
Report Subject: Temporary Borrowing By-law for 2019
Recommendations:
1. That Report FND-001-19 be received; and
2. That the By-law attached to Report FND-001-19 be approved.
Municipality of Clarington
Report FND-001-19
Report Overview
Page 2
The Municipality of Clarington is required to provide a by-law authorizing temporary
borrowing as part of its banking arrangements with TD Bank. This is an annual requirement
and remains unchanged from prior years.
1. Background
Temporary Borrowing By-law
1.1 Annually, Council is requested to grant authority to the Mayor and the Treasurer to
borrow, on a temporary basis, funds that may be required to meet current expenditures
and liabilities of the Municipality prior to the receipt of the Municipality's property taxes
and other revenues. These borrowings may be in the form of external and/or internal
sources including interFund transactions.
1.2 The legal authority for these borrowings is pursuant to Section 407 of the Municipal Act,
2001 and allows municipalities to borrow amounts between January 1 and September 30
not to exceed 50% of total estimated annual revenues and to borrow amounts between
October 1 and December 31 not to exceed 25% of total estimated annual revenues.
1.3 Consistent with prior years, the request for authority is $15,000,000. Under the
regulations the upper limit per regulations would be in excess of $25,000,000.
1.4 Historically, it has not been necessary for the Mayor and the Treasurer to exercise this
authority, it not expected that authority will be needed however this is a requirement of
our banking agreements.
2. Concurrence
Not Applicable
3. Conclusion
3.1 It is respectfully recommended that the temporary borrowing by-law be approved and
authority be provided. This authority provides the Municipality with contingency
borrowing capacity in the event of the unknown circumstances related to the collection of
the Municipality's revenues.
3.2 The proposed 2019 limit of $15 million remains at the level approved for 2018.
Municipality of Clarington
Resort FND-001-19
4. Strategic Plan Application
Not applicable.
Submitted by.
Trevor Pinn, B.Com, CPA, CA,
Director of Finance/Treasurer
Page 3
Reviewed by-:Z4301e��
Andrew C. Allison, B. Comm, LL.B
CAO
Staff Contact: Trevor Pinn, Director of Finance/Treasurer 905-623-3379 x 2602 or
tpinn@clarington.net
Attachment:
Attachment 1 - By-law to authorize temporary borrowing for the year 2019
There are no interested parties to be notified of Council's decision.
THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
BY-LAW NUMBER 2019 -
Being a by-law to authorize the borrowing of
$15,000,000 to meet, until the taxes are
collected, the current expenditures of the
Municipality for the year 2019
WHEREAS under Section 407 of the Municipal Act, 2001, the Municipality is empowered to
borrow for current expenditures from January 1 sl to September 30, up to 50 percent and from
October 1 to December 31 up to 25 percent, of the estimated revenues for the year;
NOW THEREFORE THE COUNCIL OF THE CORPORATION OF THE MUNICIPALITY OF
CLARINGTON HEREBY ENACTS AS FOLLOWS:
THAT the Director of Finance/Treasurer be hereby authorized on behalf of the
Municipality to borrow from time to time by way of operating line of credit/overdraft
facility, from the Bank holding the Municipality's banking contract, (hereinafter called the
"Bank"), a sum or sums not exceeding in the aggregate $15,000,000 to meet until the
taxes are collected the current expenditures of the Municipality for the year, including the
amounts required for the purposes mentioned in Subsection (1) of Section 407 of the
Municipal Act, 2001, with interest at such rate as may be agreed upon from time to time
with the Bank under the banking contract.
2. THAT all sums borrowed pursuant to the authority of this by-law as well as all
other sums borrowed in this year and in previous years from the Bank for any or
all of the purposes mentioned in the said Section 407, shall with interest thereon,
be a charge upon the whole of the revenues of the Municipality for the current
year and for all preceding years as and when such revenues are received.
3. THAT the Director of Finance/Treasurer is hereby authorized and directed to apply in
payment of all sums borrowed as aforesaid, together with interest thereon, all of the
monies hereafter collected or received either on account or realized in respect of taxes
levied for the current year and preceding years or from any other source which may
lawfully be applied for such purpose.
4. THAT the Director of Finance/Treasurer is hereby authorized to furnish to the
Bank a statement showing the nature and amount of the estimated revenues of
the Municipality not yet collected and also showing the total of any amounts
borrowed under Section 407 of the Municipal Act, 2001, that have not been
repaid.
BY-LAW passed in open session this 14th day of January 2019.
Adrian Foster, Mayor
C. Anne Greentree, Municipal Clerk