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REPORT
CORPORATE SERVICES DEPARTMENT
Meeting: GENERAL PURPOSE AND ADMINISTRATION COMMITTEE
Date: October 6~h, 2008
Resolution #: f ~~~~'bg
Report #: COD-054-08 File #: By-law #:
Subject: PRICE HEDGING AGREEMENTS (COMMODITIES)
STATEMENT OF POLICIES AND GOALS
Recommendations:
It is respectfully recommended to the General Purpose and Administration Committee
recommended to Council the following:
1. THAT Report COq-054-08 be received; and
2. THAT Commodity Price Hedging Agreements, Statement of Policies and Goals
for the Municipality of Clarington, as detailed in Schedule B, and required under
the Municipal Act prior to entering into any hedging agreements be approved.
Submitted by: Reviewed by: ~-"-'
arie Marano, H.B.Sc., C.M.O. Franklin Wu,
Dire r of Corpor t€ Se ices Chief Administrative Officer
ancy T to , B. .A.,
Director of Finance/Treasurer
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CORPORATION OF THE MUNICIPALITY OF CLARINGTON
40 TEMPERANCE STREET, BOWMANVILLE, ONTARIO L1C 3A6 T (905)623-3379 F (905)623-4169
REPORT NO.: COD-054-08
PAGE2
1.0 BACKGROUND
1.1 In the coming months the municipality will be undertaking a review of its energy
requirements and consumption with a view to reducing consumption through the use of
energy efficient equipment and conservation. In addition, we will be reassessing our
procurement strategy with a view to minimize cost and reducing risk of increased and
fluctuating cost due to market volatility. Products included in the review will be
electricity, natural gas and possibly fuel (gasoline, diesel and heating oil).
1.2 One of the options available to us to assist with achieving the above is the opportunity to
enter into long term supply contracts (hedging agreements). However, in order to take
this approach and remain compliant with the Municipal Act we are required to establish
a hedging policy as follows:
"Section 6.1 of Ontario Regulation 653/05 of the Municipal Act 2001 requires that before
a municipality passes a by-law authorizing a commodity price hedging agreement, the
Council of the Municipality shall adopt a statement of policies and goals relating to the
use of financial agreements to address commodity pricing and costs.°
A copy of Regulation 653/05 is attached as Schedule "A'.
1.3 The recommended Statement of Policies and Goals, attached as Schedule "B", will
address the above.
2.0
2.1 Regulations 653/05 Section (2) sets out the following matters to be considered when
preparing the statement of policies and goals:
(1) The types of projects for which commodity price hedging agreements are
appropriate.
(2) The fixed costs and estimated costs to the municipality resulting from the use of such
agreements.
(3) Whether the future price or cost to the municipality of the applicable commodities will
be lower or more stable than they would be without the agreements.
REPORT NO.: COD-054-08
PAGE3
(4) A detailed estimate of the expected results of using such agreements.
(5) The financial and other risks to the municipality that would exist with, and without, the
use of such agreements.
(6) Risk control measures relating to such agreements, such as,
I. credit exposure limits based on credit ratings and on the degree of regulatory
oversight and the regulatory capital of the other party to the agreement,
II. standard agreements, and
III. ongoing monitoring with respect to the agreements.
2.2 Under the recommended policy the Director of Finance/Treasurer, Director of Corporate
Services and the Manager of Purchasing have a number of responsibilities as follows:
(1) Treasurer
The Treasurer is responsible for determining whether a particular commodity price
hedging agreement is advantageous for the Municipality and shall consider or complete
the following:
a) a need to protect pricing of a commodity that is in a market subject to fluctuation;
b) an analysis that confirms the benefits and cost savings to the Municipality;
c) that the financial position of the Municipality will be enhanced by use of such an
agreement;
d) that the all-inclusive contracted price and cost to the Municipality of the associated
commodity will be lower and/or more stable than it would be without the agreement;
e) determine the financial and other risks to the Municipality that would exist with the
use of such an agreement and if such a risk would be lower than the financial and
other risks to the Municipality that would exist without such an agreement; and
f) ensure ongoing monitoring in conjunction with the Corporate Services Department
with respect to the commodity price hedging agreements.
REPORT NO.: COD-054-0~ PAGE 4
(2) Director of Corporate Services
The Director of Corporate Services will be authorized to:
a) enter into contracts for the purpose of engaging a Contract Agent in accordance with
the Municipality's Purchasing Policies;
b) enter into commodity price hedging agreements, co-signed by the Directors of
Finance and Corporate Services, as deemed appropriate;
c) execute commodity procurement contracts, co-signed by the Directors of Finance
and Corporate Services, execute and enter into commodity transactions in
accordance with the policy;
d) meet with the Treasurer, as required, and provide written reports regarding the past
performance of commodity price hedging agreements, future strategies and other
issues as requested;
e) notify the Treasurer, in writing, of any significant changes in the commodity price
hedging philosophies or policies and organization;
f) provide an annual list of commodity price hedging agreements and such other
information as may be requested by the Treasurer.
(3) Manager of Purchasing
The Manager of Purchasing, under the direction of the Director of Corporate Services
will be authorized to:
a) develop a prudent commodity procurement mix and specrfic procurement objectives
and policies;
b) act as Director of Corporate Services designate and as necessary execute
commodity procurement contracts and enter into commodity transactions in
accordance with the policy;
REPORT NO.: COD-054-08
PAGES
c) assist the Director of Corporate Services, meet with the Treasurer, as required, and
provide written reports regarding the past performance of commodity price hedging
agreements, future strategies and other issues as requested;
d) advise or make recommendations to the Director of Corporate Services and
Treasurer with respect to any significant changes in the commodity price hedging
philosophies or policies and organization;
e) maintain a list of commodity price hedging agreements and such other information as
may be required for submission to the Treasurer.
2.3 As noted in Section 1 above, it is anticipated that the municipality will be entering into
new agreements in the not to distant future for the purchase of natural gas and
electricity. In each case the goal will be to ensure continuous supply and product at a
competitive price and avoid the cost fluctuations brought about by a volatile market.
With the increasing cost of oil it may be necessary to enter into long term supply
agreements for vehicle and heating fuel in order to ensure supplies and stabilize prices.
In anticipation of this possibility, petroleum products have been included in the proposed
policy.
3.0 CONCLUSION
3.1 The Regulation and by extension the proposed policy requires a high standard for
monitoring, analysis, risk assessment and reporting for the municipality.
3.2 With the introduction of a new Hedging Policy coupled with evolving procurement
strategies the Municipality will be in a position to move forward and deal with energy
acquisitions as required.
Attachments:
Attachment 2 -Schedule "A", Regulation 653/05
Attachment 1 -Schedule "B", Statement of Policies and Goals
SCHEDULE "A"
Municipal Act, 2001
Loi de 2001 sur les municipalites
ONTARIO REGULATION 653/05
DEBT-RELATED FINANCIAL INSTRUMENTS AND FINANCIAL AGREEMENTS
Consolidation Period: From January I, 2007 to the e-Laws currency date.
Last amendment: O.Reg. 604/06.
This Regulation is made in English only.
Skip Table of Contents
CONTENTS
I. Interpretation
INTERPRETATION
BOND FORWARD AGREEMENTS
2. Bond forward agreements
3. Statement of policies and goals re bond forward agreements
4. Report nn bond forward agreements
COMMODITY PRICE HEDGING AGREE.bI ENTS
5. Commodiy price hedging agreements
6. Statement of policies and goals re commodity price hedging agreements
Z.. Report on commodity price hedging agreements
LEASE FINANCING AGREEMENTS
8. Lease financing agreements, capital undertakings
9. Statement of policies and goals re lease financing agreements
10. Advice to council re lease financing agreements
II. Report on lease financing agreements
INTERPRETATION
Interpretation
1. (I) In this Regulation,
"bond forward agreement" means a financial agreement described in section 2;
"commodity" means, whether in the original or a processed state, an agricultural product, a forest product, a product of the
sea, a mineral, a metal, a hydrocarbon fuel, electricity, a precious stone or other gem and other physical goods but does no[
include chattel paper, a document of title, an instrument, money or securities;
"commodity price hedging agreement" means a financial agreement described in section 5;
"lease financing agreement" means a financial agreement described in section 8. O. Reg. 653/05, s. 1 (1).
(2) For the purposes of this Regulation, a lease financing agreement has a material impact on a municipality if the costs or
risks associated with the agreement significantly affect the municipality's deb[ and financial limit determined in accordance
with Ontario Regulation 403/02 (Deb[ and Financial Obligation Limits) made under the Act, or would reasonably be
expected to have a significant effect on that limit. O. Reg. 653/05, s. I (2); O. Reg. 604/06, s. 1.
BOND FORWARD AGREEMENTS
Bond forward agreements
2. (]) A municipality that has passed a by-law authorizing the issue or refinancing of debentures denominated in
Canadian currency may enter a bond forward agreement in order to minimize the cost or risk associated with the debentures
because of fluctuations in interest rates. O. Reg. 653/05, s. 2 (1).
(2) A bond forward agreement shall provide for the following matters:
1. Borrowing and selling one or more debt instruments issued by the Govemment of Canada or the Province of Ontario
("government debt instruments").
SCHEDULE "A"
2. Buying back the government debt instruments.
3. Specifying a settlement day, which is a specified future date or the date on which a specified future event occurs.
4. Requiring a settlement payment to be payable on [he settlement day if there is a difference between [he price at which
the government debt instruments are sold as described in paragraph I and the price at which [hey are bought back as
described in paragraph 2.
5. Specifying that delivery of a document evidencing the government debt instrument is not required under the
agreement. O. Reg. 653/05, s. 2 (2).
(3) A municipality shall not enter a bond forward agreement if the total value of the principal of the government debt
instruments borrowed and sold as described in pazagraph 1 of subsection (2) exceeds the total value of the principal of the
debentures whose cost or risk the agreement is intended to minimize. O. Reg. 653/05, s. 2 (3).
(4) A municipality that enters a bond forward agreement shall monitor the value of the government debt instruments
described in pazagraph 1 of subsection (2) on each business day after the agreement is executed and before the settlement day
described in paragraph 3 of subsection (1), but the municipality shall not obtain the information about the value of the
instruments from any person who has a financial interest in the agreement or in the instruments. O. Reg. 653/05, s. 2 (4).
(5) A municipality shall not enter a bond forward agreement under which the settlement day described in pazagraph 3 of
subsection (2) is 60 days or more after the day on which the agreement is executed. O. Reg. 653/05, s. 2 (5).
(6) A municipality shall not enter a bond forward agreement under which the settlemem payment exceeds the difference in
price described in paragraph 4 of subsection (2). O. Reg. 653/05, s. 2 (6).
(7) A municipality shall not enter a bond forward agreement except with a bank listed in Schedule I, II or III to the Bank
Act (Canada) and only if the bank's long-term debt obligations on the day the agreement is entered are rated,
(a) by Dominion Bond Rating Service as "A(high)" or higher;
(b) by Fitch Ratings as "A+" or higher;
(c) by Moody's Investors Service Inc. as "Al" or higher; or
(d) by Standard and Poor's as "A+" or higher. O. Reg. 653/05, s. 2 (7).
(8) A municipality shall not sell or lend a bond forward agreement. O. Reg. 653/05, s. 2 (8).
(9) If the bond forwazd agreement relates to debentures [o be issued or refmanced for the purposes of another municipality,
the interested municipalities may enter one or more agreements relating to the costs of the bond forwazd agreement and
relating to other matters arising from the bond forwazd~agreement. O. Reg. 653/05, s. 2 (9).
(10) A municipality shall not use the proceeds from a bond forward agreement except for the following purposes:
1. To pay the interest or repay the principal of the debentures to which the agreement relates.
2. For any purpose for which the debentures were issued.
3. To pay the interest or repay the principal of any outstanding temporary borrowing made under section 405 or 406 of
the Act in connection with the debentures.
4. To pay the interest or repay the principal of any other outstanding borrowing by the municipality for a capital
expenditure. O. Reg. 653/05, s. 2 (10).
Statement of policies and goals re bond forward agreements
3. (1) Before a municipality passes a by-law authorizing a bond forward agreement, the council of the municipality shall
adopt a statement of policies and goals relating [o the use of bond forward agreements. O. Reg. 653/05, s. 3 (1).
(2) The council of the municipality shall consider the following matters when preparing the statement of policies and
goals:
1. The types of projects for which bond forward agreements aze appropriate.
2. The fixed costs and estimated costs to the municipality resulting from the use of such agreements.
3. A detailed estimate of the expected results of using such agreements.
4. Risk control measures relating to such agreements, such as,
i. credit exposure limits based on credit ratings and on the degree of regulatory oversight and the regulatory capital
of the other party to the agreement,
ii. standard agreements, and
iii. ongoing monitoring with respect to the agreements.
SCHEDULE "A"
5. The financial and other risks to the municipality that would exist with, and without, the use of such agreements.
O. Reg. 653/05, s. 3 (2).
Report on hood forward agreements
4. (1) If a municipality has entered any bond forward agreements in a fiscal yeaz, the treasurer of the municipality shall
prepare and present to the municipal council once in that fiscal year, or more frequently if the council so desires, a detailed
report on all of [hose agreements. O. Reg. 653/05, s. 4 (1).
(2) The report must contain the fallowing information and documents:
1. A statement comparing the expected and actual results of using bond forward agreements during the period of the
report.
2. A statement by the treasurer indicating whether, in his or her opinion, alt of the bond forward agreements entered
during the period of the report are consistent with the municipality's statement of policies and goals relating to the use
of bond forward agreements.
3. Such other information as the council may require.
4. Such other information as the treasurer considers appropriate to include in [he report. O. Reg. 653/05, s. 4 (2).
COMMODIi"Y PRICE HEDGING AGREEMENTS
Commodity price hedging agreements
5. (1) A municipality that has entered, or plans to enter, anagreement under Par[ II of the Act for the supply of a
commodity required for a municipal system may enter into one or more financial agreements to minhnize the cost or
financial risk associated with incurring debt for the commodity. O. Reg. 653/05, s. 5 (1).
(2) The financial agreement must fix, directly or indirectly, or enable the municipality to fix the price or range of prices to
be paid by the municipality for the future delivery of some or all of the commodity or the future cost to the municipality of an
equivalent quantity of the commodity. O. Reg. 653/05, s. 5 (2).
(3) Subject to subsection (4), the municipality shall not sell or otherwise dispose of [he financial agreement or any interest
of the municipality in the agreement. O. Reg. 653/05, s. 5 (3).
(4) The municipality may sell or otherwise dispose of a financial agreement or an interest of the municipality in the
agreement if, in the opinion of the treasurer of the municipality, the sale or disposition is in the best interests of the
municipality and if either of the following conditions is satisfied:
1. The sale or disposition is part of a transaction for the sale of real property by the municipality relating to a change in
the use of the property by the municipality.
2. The municipality has ceased to carry on any activity relating to the municipal system for which the commodity was
being acquired. O. Reg. 653/05, s. 5 (4).
Statement of policies and goals re commodity price hedging agreements
6. (1) Before a municipality passes a by-law authorizing a commodity price hedging agreement, [he council of the
municipality shall adopt a statement of policies and goals relating [o the use of financial agreements to address commodity
pricing and costs. O. Reg. 653/05, s. 6 (1).
(2) The council of the municipality shall consider the following matters when preparing the statement of policies and
goals:
1. The types of projects for which commodity price hedging agreements are appropriate.
2. The fixed costs and estimated costs to the municipality resulting from the use of such agreements.
3. Whether the futwe price or cost to the municipality of the applicable commodities will be lower or more stable than
they would be without the agreements.
4. A detailed estimate of [he expected results of using such agreements.
5. The financial and other risks to the municipality that would exist with, and without, the use of such agreements.
6. Risk control measures relating [o such agreements, such as,
i. credit exposure limits based on credit ratings and on the degree of regulatory oversight and the regulatory capital
of the other party to the agreement,
ii. standard agreements, and
iii. ongoing monitoring with respect to the agreements. O. Reg. 653/05, s. 6 (2).
Report on commodity price hedging agreements
SCHEDULE "A"
7. (1) If a municipality has any subsisting commodity price hedging agreements in a fiscal yeaz, the treasurer of the
municipality shall prepare and present to the municipal council once in that fiscal yeaz, or more frequently if the council so
desires, a detailed report on all of those agreements. O. Reg. 653/05, s. 7 (1).
(2) The report must contain [he following information and documents:
1. A statement about the status of [he agreements during the period of the report, including a comparison of the expected
and actual results of using the agreements.
2. A statement by [he treasurer indicating whether, in his or her opinion, all of [he agreements entered during the period
of the report aze consistent with the municipality's statement of policies and goals relating to the use of financial
agreements to address commodity pricing and costs.
3. Such other information as the council may require.
4. Such other information as the treasurer considers appropriate to include in the report. O. Reg. 653/05, s. 7 (2).
LEASE FINANCING AGREEMENTS
Lease financing agreements, capital undertaldnge
S. (1) A municipality may enter lease financing agreements for the purpose of obtaining long-term financing of a capital
undertaking of the municipality. O. Reg. 604/06, s. 2.
(2) If a lease financing agreement described in subsection (1) includes terms that require, or may require, the municipality
to make payments after the expiry of the term for which the council authorizing the agreement was elected, sections 9, 10 and
11 apply to the agreement. O. Reg. 604/06, s. 2.
(3) A lease fmancing agreement must include a schedule of all fixed payments, if any, required by the agreement and that
may be required by any extension or renewal of the agreement. O. Reg. 604/06, s. 2.
Statement of policies and goals release financing agreements
9. (1) Before a municipality passes a by-law authorizing a lease financing agreement, the council of the municipality shall
adopt a statemenC of policies and goals relating to the use of lease financing agreements. O. Reg. 653/05, s. 9 (1).
(2) The statement of policies and goals,
(a) must include a discussion of the financial and other risks to the municipality of using lease financing agreements; and
(b) may provide for a category of lease financing agreements composed of agreements which, in the opinion of both the
council of the municipality and the treasurer, would not result in a material impact for [he municipality. O. Reg.
653/05, s. 9 (2).
Advice to wuncil re lease financing agreements
10. (1) Before a municipality enters into a lease financing agreement, the municipality shall,
(a) have its treasurer prepare a report with a recommendation, assessing, in the opinion of the treasurer, the costs and
financial and other risks associated with the proposed agreement, including,
(i) a comparison between the fixed and estimated costs and the risks associated with the proposed agreement and
those associated with other methods of financing
(ii) a statement summarizing, as may be applicable, the effective rate or rates of financing for the agreement, the
ability for agreement payment amounts to vary, and the methods or calculations, including possible financing rate
changes, that may be used to establish that vaziance under the agreement,
(iii) a statement summarizing any contingent payment obligations under the agreement that in the opinion of the
treasurer would result in a material impact for the municipality, including agreement termination provisions,
equipment loss, equipment replacement options and guarantees and indemnities,
(iv) a summary of the assumptions applicable to any possible variations in the agreement payment and contingent
payment obligations, and
(v) any other matters the treasurer or council considers advisable;
(b) obtain legal advice and financial advice with respect to the proposed a~eement;
(c) consider if the scope of the proposed transaction warrants obtaining legal advice or financial advice with respect to the
proposed agreement that is from a source independent of the source of the advice mentioned in clause (b);
(d) advise in writing the regional municipality of which it forms a part of the proposed agreement before the agreement is
entered into, in the case of a lower-tier municipality; and
SCHEDULE "A"
(e) consider and give its assessment of the report prepared under clause (a), including whether, in its opinion, the costs of
financing for the proposed agreement are lower than other methods of financing available to the municipality, and
whether the risks associated with the proposed agreement are reasonable. O. Reg. 653/05, s. 10 (1).
(2) The costs and risks associated with a proposed lease financing agreement in a report made under subsection (1) shall
be assessed as of the date the report is made. O. Reg. 653/05, s. 10 (2).
(3) At any time afrer a report under subsection (1) is made, but before the proposed lease financing agreement is entered
into, if the treasurer becomes of [he opinion that a changed circumstance with respect to the proposed agreement may result
in a material impact for the municipality, the treasurer shall as soon as is reasonably possible update the report and present
the updated report to the council. O. Reg. 653/05, s. 10 (3 ).
(4) A report made under subsection (1) shall summarize the information required by that subsection for the entire term of
the proposed lease financing agreement, including any possible extensions or renewals. O. Reg. 653/05, s. ] 0 (4).
(5) Despite this section, a municipality may enter into a lease financing agreement without complying with the
requirements of subsection (1) if,
(a) the statement of policies and goals for lease financing agreements includes the category referred to in clause 9 (2) (b);
and
(b) in the opinion of the treasurer and the council, the proposed agreement is within that category, and its costs and risks,
in combination with all the others agreements of that category entered into or proposed to be entered into in that year
by the municipality, would not result in a material impact for the community. O. Reg. 653/05, s. 10 (5).
(6) In this section,
"costs" includes the costs of any advice obtained under clause (1) (b) or (c). O. Reg. 653/05, s. 10 (6).
Report on lease Flnancing agreemen[e
11. (1) If a municipality has one or more lease financing agreements subsisting in a fiscal year, the treasurer of the
municipality shall prepare and present [o council of the municipality once in that fiscal year, or more often if the council so
desires, a detailed report containing the information described in subsection (2). O. Reg. 653/05, s. 11 (1).
(2) The detailed report mentioned in subsection (1) shall contain,
(a) a description of the estimated proportion of the total financing arrangements of the municipality that is undertaken
through lease financing agreements to the total long-term debt of the municipality and a description of the change, if
any, in that estimated proportion since the previous year's report;
(b) a statement by the treasurer as to whether, in his or her opinion, all lease financing agreements were made in
accordance with the statement of leasing policies and goals adopted by the municipality; and
(c) any other information that the council may require or that, in the opinion of the treasurer, should be recorded. O. Reg.
653/05, s. 11 (2).
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COMMODITY PRICE HEDGING AGREEMENTS
STATEMENT OF POLICIES AND GOALS
September 2008
Interpretation
Schedule "B"
This policy is to be interpreted and applied in accordance with the requirements
of the Municipal Act, 2001 ("the Act") and any regulations passed thereunder
("the regulations"). Terms used in this policy have the meanings applicable to
those terms in the corresponding sections of the Act and the regulations.
Definitions
For the purpose of this Statement of Policies and Goals, the following definitions
shall apply:
a) "Commodity" means electricity, natural gas and/or petroleum products
(fuel).
b) "Contract Agent" means an independent individual or organization acting
on behalf of the Corporation as an independent contractor external to the
Municipality to provide advice on price hedging strategy, commodity
related reporting and when authorized to execute agreements and
transactions.
c) A "price hedging agreement" means a financial agreement to minimize the
cost or financial risk associated with the purchase of a commodity.
Purpose of Statement
This Statement of Policies and Goals (the "Policy") provides the framework
relating to the use of financial agreements to address commodity price hedging
by the Municipality of Clarington.
Statement of Policies and Goals Page 1 of 4
The Municipality of Clarington ("Municipality") will consider commodity price
hedging agreements as a means of fixing, directly or indirectly, or enabling the
Municipality to fix the price or range of prices to be paid by the Municipality for
the continuous supply and future delivery of some or all of a commodity, where it
is advantageous for the Municipality to do so.
Delegation of Responsibilities
The Director of Finance/Treasurer or designate ("Treasurer") is responsible for
the financial administrative matters pertaining to commodity price hedging. The
Treasurer may delegate certain administrative duties and/or responsibilities to
internal staff.
The Director of Corporate Services or designate ("Director") is responsible for the
procurement and contractual administrative matters pertaining to commodity
price hedging. The Director may delegate certain administrative duties and/or
responsibilities to internal staff and external agents.
Director of FinancelTreasurer
The Treasurer is responsible for determining whether a particular commodity
price hedging agreement is advantageous for the Municipality and shall consider
or complete the following:
a) a need to protect pricing of a commodity that is in a market subject to
fluctuation;
b) an analysis that confirms the benefits and cost savings to the Municipality;
c) that the financial position of the Municipality will be enhanced by use of
such an agreement;
d) that the all-inclusive contracted price and cost to the Municipality of the
associated commodity will be lower and/or more stable than it would be
without the agreement;
e) determine the financial and other risks to the Municipality that would exist
with the use of such an agreement and if such a risk would be lower than
the financial and other risks to the Municipality that would exist without
such an agreement; and
f) ensure ongoing monitoring in conjunction with the Corporate Services
Department with respect to the commodity price hedging agreements.
Statement of Policies and Goals Page 2 of 4
Director of Corporate Services
The Corporate Services Director or designate is authorized to:
a) enter into agency agreements and/or contracts with Contract Agents in
accordance with the Municipality's Purchasing Policies;
b) enter into commodity price hedging agreements, co-signed by the
Directors of Finance and Corporate Services, as deemed appropriate;
c) execute commodity procurement contracts and transactions, co-signed by
the Directors of Finance and Corporate Services, in accordance with the
policy;
d) meet with the Treasurer, as required, and provide written reports
regarding the past performance of commodity price hedging agreements,
future strategies and other issues as requested;
e) notify the Treasurer, in writing, of any significant changes in the
commodity price hedging philosophies or policies and organization;
f) provide an annual list of commodity price hedging agreements and such
other information as may be requested by the Treasurer.
Manager of Purchasing
The Manager of Purchasing, under the direction of the Director of Corporate
Services will be authorized to:
a) develop a prudent commodity procurement mix and specific procurement
objectives and policies;
b) act as Corporate Services Director's designate and as necessary execute
commodity procurement contracts and enter into commodity transactions
in accordance with the policy;
c) assist the Corporate Services Director, meet with the Treasurer, as
required, and provide written reports regarding the past performance of
commodity price hedging agreements, future strategies and other issues
as requested;
d) advise or make recommendations to the Corporate Services Director and
Treasurer with respect to any significant changes in the commodity price
hedging philosophies or policies and organization; and
Statement of Policies and Goals Page 3 of 4
e) maintain a list of commodity price hedging agreements and such other
information as may be required for submission to the Treasurer.
Contract Agent
The Contract Agent will be authorized to act within the scope of delegated
authority under any executed contract and/or Agency Agreement and provide a
number of services to the Municipality, which may include:
a) assisting the Manager of Purchasing in developing a prudent commodity
procurement mix and specific procurement objectives and policies;
b) monitoring, analyzing and reporting on the Municipality's commodity
purchases, financial position and supporting the Manager of Purchasing
with respect to commodity procurement related matters;
c) assisting in the selection of commodity suppliers;
d) meeting with the Manager of Purchasing, as required; and
e) entering into commodity transactions or commodity procurement
agreements on behalf of the Municipality with commodity suppliers and/or
distribution utilities when so directed and authorized by the Manager of
Purchasing, Treasurer and Director of Corporate Services and where a
proper Agency Agreement has been executed with the Municipality.
Statement of Policies and Goals Page 4 of 4