HomeMy WebLinkAbout2021-09-28Claibygton
Audit and Accountability
Committee Agenda
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Date: September 28, 2021
Time: 9:30 am
Place: Held Virtually via Microsoft Teams
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1. Call to Order
2. Land Acknowledgement Statement
3. Declarations of Interest
4. Adoption of Minutes of Previous Meeting(s)
4.1. Minutes of meeting held August 4, 2021 Page 3
5. Presentations
5.1 Verbal Update — Catherine Carr, Manager of Internal Audit
6. Delegations
6.1 none
7. Communications — Receive for Information
7.1 Investment compliance memo dated August 25, 2021 Page 6
7.2 Memo from Director of Financial Services dated Page 10
September 10, 2021, PSAB Update
Page 1 of 92
Audit and Accountability Committee — September 10, 2021
8. Items for Direction
8.1. Report IAS-003-21, Financial Update to June 30, 2021 Page 21
Recommendations:
1. That Report IAS-003-21 be received for information
9. Other Business
9.1. Report FSD-036-21, Purchasing By-law
This item was referred back to Committee from Council on July 5, 2021 for
reconsideration.
10. Adjournment
Page 66
Page 2 of 92
Clarftwn
Audit Committee
Minutes
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Coordinator at 905-623-3379 ext. 2131.
Date: August 4, 2021
Time: 9:00 AM
Place: Held Virtually via Microsoft Teams
Present: Mayor Foster, Councillor Hooper, Councillor Neal (9:24 AM)
Staff Present: Andy Allison, Trevor Pinn, Catherine Carr, Heather Lynch, Michelle Pick
Guests: Trina Connell and Matthew Haire from BDO Canada LLP, Councillor Zwart (as
an observer)
1. Call to Order
Councillor Hooper called the meeting to order at 9:05 AM and chaired the meeting
until 9:24 AM when Councillor Neal assumed the chair.
2. Land Acknowledgement Statement
Councillor Hooper recited the Land Acknowledgement Statement.
3. Declarations of Interest
3.1 Councillor Hooper declared a direct interest in 7.2 of Communications — Receive for
Information and 8.1 (3) of Items for Direction.
4. Adoption of Minutes of Previous Meeting(s)
Resolution #AAC-013-21
Moved and seconded by Mayor Foster
That the minutes from the Audit and Accountability Committee held June 29, 2021 be
approved, with two administrative amendments (time to read: 9:00 am, and to correct
the spelling of Andy Allison's name).
Carried
5. Presentations
5.1 Representatives from BDO Canada LLP presented the 2020 audit findings.
6. Delegations
6.1 None
Page 3 of 92
Audit Committee Minutes August 4, 2021
7. Communications — Receive for Information
Resolution #AAC-014-21
Moved by Councillor Hooper
Seconded by Mayor Foster
That the final letters for 7.1 the Municipality of Clarington, 7.3 Newcastle BIA and 7.4
Orono BIA, be received for information and the included representation letters be
signed by CAO and Director of Financial Services/Treasurer.
Carried
Resolution #AAC-015-21
Moved by Mayor Foster
Seconded by Councillor Neal
That final letter for 7.2 Historical Downtown Bowmanville BIA be received for
information and the included representation letters be signed by CAO and Director of
Financial Services/Treasurer.
Carried
Resolution #AAC-016-21
Moved by Mayor Foster
Seconded by Councillor Hooper
That the memo to the Audit and Accountability Committee from the Director of Financial
Services/Treasurer be received for information.
Carried
8. Items for Direction
8.1 Report FSD-033-21, 2020 Financial Statements
Resolution #AAC-017-21
Moved by Mayor Foster
Seconded by Councillor Neal
3. That the Financial Statements for the Board of Management for Historic
Downtown Bowmanville Business Improvement Area for the year ending
December 31, 2020 be approved.
Carried
Page 4 of 92
Audit Committee Minutes August 4, 2021
Resolution #AAC-017-21
Moved by Mayor Foster
Seconded by Councillor Hooper
1. That Report FSD-033-21 be received;
2. That the Consolidated Financial Statements for the Municipality of Clarington for
the year ending December 31, 2020 be approved;
4. That the Financial Statements for the Board of Management for the Newcastle
Central Business District Improvement Area for the year ending December 31,
2020;
5. That the Financial Statements for the Board of Management for the Orono
Central Business District Improvement for the year ending December 31, 2020;
6. That the Financial Statements for the Municipality of Clarington Trusts for the
year ending December 31, 2020 be approved; and
7. That, Staff prepare the Annual Financial Report for the year ending December
31, 2020 for public consumption with information substantively as discussed in
Report FSD-033-12 and that it be placed on the Municipality's website.
Carried
9. Other Business
9.1 Resolution #AAC-018-21
Moved by Mayor Foster
Seconded by Councillor Hooper
That the Members of Council be requested to appoint an alternate to the audit and
accountability committee.
Carried
Recommendation to Council #1
That Council appoint an alternate to the audit and accountability committee.
10. Adjournment
Resolution #AAC-019-21
Moved by Councillor Hooper
Seconded by Mayor Foster
That the meeting adjourn at 10:19 AM.
Carried
Page 5 of 92
Clarftwn
MEMO
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Accessibility Coordinator at 905-623-3379 ext. 2131.
To: Audit and Accountability Committee
Andrew Allison, Chief Administrative Officer
Trevor Pinn, Director of Financial Services / Treasurer
From: Catherine Carr, Internal Audit Manager
Date: August 25, 2021
Re: Municipal Investment Compliance at June 30, 2021 - Updated
This Investment Compliance memo is to provide an update as at June 30, 2021 on the
compliance of the Municipality's investments with the approved Investment Policy. There
were some investments made in June that were not included in original memo of July 30.
This is an updated memo with the corrected numbers. The applicable Investment Policy was
approved by Council July 3, 2018. If not compliant, the Municipality would be required to
prepare a workout plan to dispose of non -compliant investments as well as resolve any
other issues that have been identified. However, an updated Investment Policy was
accepted at the Audit and Accountability Committee (AAC) meeting of June 29, 2021 and
@ approved by Council on July 5, 2021. The limits that were changed are noted in the
applicable sections as a reference.
This memo is provided to the members of the AAC when prepared for each quarter. This
committee provides the appropriate review of the document as outlined in the terms of
reference. A copy of the memo will be on the next regular AAC agenda (in this case,
September 10, 2020. If required, a response from the Director of Financial Services will
included on the agenda as well.
The current calculations include the Reserve Fund bank account but do not included the
General Fund bank account. The General Fund TD bank account is used for the ongoing
operations and are consider as "required immediately" and therefore are not eligible for
investing. As the Reserve Bank account is not used for ongoing operations and is available
for investing, it is included in these investment compliance calculations. The omission of the
General Fund bank account would result in the calculated totals being a lower percentage
than actual. If the Municipality is compliant without this bank account, then it will be
compliant if it was to be included.
_ The following information is shown for the Municipality's total investments as the restrictions
identified in the policy are based on the total investments, not individual funds. Note that the
Perpetual Care Trust Funds for cemetery maintenance are not included. Perpetual care and
maintenance trust funds are regulated by Funeral, Burial and Cremation Act, 2002.
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1 C 3A6
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Page 6 of 92
Investment Compliance June 30, 2021
Investments by Institution
The Municipality's policy has the following restrictions, among others, to ensure that credit
risk is mitigated through avoiding a concentration of investments with any given institution:
• ONE Fund portfolios are restricted to 15 per cent for each type (The ONE HISA
account is excluded as it is a cash account)
• Financial institution (including bonds, GICs) is restricted to 20 per cent for each
institution; note that this is increased to 25 per cent as of July 5, 2021
• Municipal bonds are restricted to 10 per cent per municipality
• Provincial bonds are restricted to 20 per cent for each province
• Corporate debt is restricted to 5 per cent for each corporation.
'ABLE 1 INVESTMENTS BY INSTITUTION
% of Minimum Maximum
Total Funds Total Ranae Ranae
TD Bank - Savings
24,522,277
22.3%
0%
100%
ONE - HISA
$ 4,032
0.0%
0%
100%
ONE - Equity
2,588,679
2.4%
0%
15%
ONE - Bond
4,354,126
4.0%
0%
15%
RBC
10,374,041
9.4%
0%
20%
RBC - HISA
65,580
0.1%
0%
100%
National Bank
8,805,845
8.0%
0%
20%
BNS
16,929,891
15.4%
0%
20%
BMO
18,959,520
17.3%
0%
20%
HSBC
3,358,884
3.1 %
0%
20%
TD Bank
4,841,449
4.4%
0%
20%
Prov BC
2,388,950
2.2%
0%
20%
City of Toronto
4,778,046
4.3%
0%
10%
Prov Alberta
2,384,585
2.2%
0%
20%
Prov Quebec
2,499,732
2.3%
0%
20%
Ontario Hydro
2,499,594
2.3%
0%
5%
Regional Municipality of York
498,525
0.5%
0%
10%
$ 109,853,756
100.0%
There are other restrictions identified in the policy; however, we do not currently have any
investments to which they apply.
The Municipality was compliant with all restrictions on investment with individual institutions.
It should be noted that, per the policy, cash accounts (ONE HISA and TD Bank Savings) are
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON 1-1 C 3A6
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Page 7 of 92
Investment Compliance June 30, 2021
not to be included when determining the amount to be invested with an institution. For this
reason, the two accounts are listed separately in the table above.
Term of Investment
The Municipality's policy has adopted ranges for term length to ensure liquidity and to
minimize interest rate risk. Note that investments greater than 10 years up to a maximum of
20 years have the additional requirement that they must be specifically tied to an expected
cash flow.
TABLE 2 TERM OF INVESTMENT
Minimum Maximum
Total Funds % of Total Range Range
90 Days $ 31,531,264 28.7% 20% 100%
90 Days to 1 Year 11,997,986 10.9% 39.6% 30% 100%
1 to 5 Years 24,630,531 22.4% 0% 85%
5 to 10 Years 35,671,025 32.5% 0% 50%
10 to 20 Years 6,022,950 5.5% 0% 30%
$ 109,853,756 100.0%
The Municipality was compliant with the stated term length restrictions. The TD Reserve
Bank account bank account is 75 per cent of the under 90 days investment total. Bank
accounts including the ONE HISA are immediately accessible and thereby highly liquid.
The investments in the 10 to 20 year terms are bank bonds and provincial bonds which are
considered to have good liquidity. There are uses for these long-term investments, but the
specifics have not been clearly identified. By percentages, the 10 to 20 year term
investments are split as follows: non development charge 47.2 per cent, development
charge 16.6 per cent, and strategic capital 36.2 per cent. The link between long term
investments and expected cash flows must be documented as required by the policy.
Type of Investment
To ensure that the Municipality has a diversified investment portfolio the following
restrictions are in place:
• Cash is unrestricted and includes the High Interest Savings Account as well as other
bank accounts held at chartered banks
• Federal debt is unrestricted
• Provincial debt is allowed to a maximum of 80 per cent in aggregate
• Municipal debt is allowed to a maximum of 35 per cent in aggregate
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1 C 3A6
■ 1-800-563-1195 1 Local:905-623-3379 1 info@clarington.net I www.clarington.net
Page 8 of 92
Investment Compliance June 30, 2021
• Financial institution investments are allowed to a maximum of 60 per cent in
aggregate and includes bonds, GICs and other eligible investments; note that this is
increased to 80 per cent as of July 5, 2021
• Corporate debt is allowed, subject to rating restrictions, to maximum of 10 per cent in
aggregate
• ONE Investment pools (not including HISA) are allowed to a maximum of 25 per cent
in aggregate.
TABLE 3 TYPE OF INVESTMENT
% of Minimum Maximum
Total Funds Total Range Range
HISA
$ 24,580,949
22.4%
0%
100%
Federal Debt
-
0.0%
0%
100%
Provincial Debt
7,273,267
6.6%
0%
80%
Municipal Debt
5,276,571
4.8%
0%
35%
Financial Institutions
63,280,570
57.6%
0%
60%
Corporate Debt (non -financial)
2,499,594
2.3%
0%
10%
ONE Investment Pools
6,942,805
6.3%
0%
25%
$ 109,853,756
100.0%
As of June 30, 2021, the Municipality was compliant with the restrictions for the investment
types as defined in the Municipal Investment Policy. The corporate debt is an Ontario Hydro
bond held in the non -development charges reserve funds.
Overall, the Municipality is compliant with the Investment Policy as of June 30, 2021. If the
newly approved Investment Policy of July 5, 2021 is applied, the Municipality remains in
compliance. The one exception is the lack of documentation of the link for investments with
maturities 10 to 20 years to a specific future cash flow. It is likely there are several future
projects that could be linked to these longer term investments.
If you have any questions, please let me know.
Name: Catherine Carr
Job Title: Internal Audit Manager
Financial Services / CAO
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1 C 3A6
■ 1-800-563-1195 1 Local:905-623-3379 1 info@clarington.net I www.clarington.net
Page 9 of 92
C►arington
MEMO
If this information is required in an alternate format, please contact the
Accessibility Coordinator at 905-623-3379 ext. 2131.
To: Members of the Audit and Accountability Committee
From: Trevor Pinn, CPA, CA — Director of Financial Services/Treasurer
Date: September 10, 2021
File No.:
Re: Upcoming changes to Public Sector Accounting Standards
This memo is a technical update on financial reporting standard changes. Financial policies
are within the Terms of Reference for the Audit and Accountability Committee; this memo is
for informational use.
The Municipality of Clarington is required to follow Public Sector Accounting Standards
(PSAS) as approved by the Public Sector Accounting Board (PSAB). The PSAB is
responsible for developing standards for public sector entities (including public sector not -
for -profit organizations) and contributing to the development of international public sector
accounting standards. PSAB is independent of CPA Canada, however CPA Canada
publishes the accounting handbooks which includes PSAS.
From time -to -time PSAB will introduce new or significantly amended changes to PSAS
which must be adopted by those organizations that follow PSAS. Typically, the effective
dates are for years starting on or after April 1 of a year; this corresponds with the fiscal year
of most public sector organizations/governments in Canada.
This memo is to provide information to the Members of the Audit and Accountability
Committee, about the upcoming financial reporting changes which will impact the financial
statements.
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1 C 3A6
1-800-563-1195 1 Local:905-623-3379 1 info@clarington.net I www.clarington.net
Page 10 of 92
The following table summarizes the changes over the next few years
PS 1201 Financial
Statement Presentation
PS 2601 Foreign Currency
Translation
PS 3041 Portfolio
Investments
PS 3450 Financial
Instruments
PS 3280 Asset Retirement
Obligations
PS 3400, Revenue
PSG-8 Purchased
Intangibles
Changes to the presentation
of financial information
including new statements
Brings standard for foreign
currency translation in line
with other accounting
standards
When PS 2601 and PS
3450 are adopted
2023 (April 1, 2022 or when
PS 1201 and PS 3450 are
adopted)
Updates recognition and When PS 1201, PS 2601
presentation for investments and PS 3450 are adopted
Brings standards in place in
other frameworks for
recognition, presentation,
and disclosure of financial
instruments
Recognition, disclosure, and
presentation standards for
liabilities upon the
retirement of an asset
Clarifies recognition criteria
for revenues where there
isn't already guidance
Provides guidance on the
measurement and
recognition of purchased
intangible assets
2023 (April 1, 2022 or when
PS 1201 and PS 2601 are
adopted)
2023 (April 1, 2022 or earlier
if desired)
2024 (April 1, 2023 or
earlier)
2024 (April 1, 2023 or
earlier)
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1C 3A6
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Page 11 of 92
Fiscal Year 2023
The following pronouncements are effective for years beginning on or after April 1, 2022,
making them applicable to the Municipality's 2023 fiscal year. Early adoption of these
standards is permitted; however, the Financial Statement Presentation, Foreign Currency
Translation, Portfolio Investments and Financial Instrument sections must all be adopted
together.
Financial Statement Presentation, PS 1201
This standard was initially approved in 2011 and has been delayed several times. The
significant changes include the creation of a new Statement of Remeasurement Gains and
Losses which will be used to present the impacts of financial instruments and other fair
value changes.
The Statement of Financial Position must report net debt and the accumulated
surplus/deficit. Liabilities and financial assets are reported in this statement, with the
difference being the net debt (assets). Non -financial assets are shown below the net debt
indicator, with the net assets as the bottom line. The layout for this statement is changed in
PS 1202.
The Statement of Operations reports revenues, other than remeasurement gains, of the
accounting period based on the significant types of revenue. Expenses, other than
remeasurement expenses, are shown by function or major program. The difference between
the revenues and expenses represents the operating surplus/deficit for the year. The
accumulated surplus/deficit at the beginning of the year is then reconciled to determine the
ending accumulated surplus as shown on the Statement of Financial Position.
The Statement of Remeasurement Gains and Losses will report the accumulated
remeasurement gains and losses at the beginning of the period, identifying the gains and
losses during the period (separately including those that arose during the period and those
that were reclassified from the Statement of Operations), any other comprehensive income
that arose from Government Business Enterprises (e.g. Elexicon), and the accumulated
remeasurement gains and losses at the end of the period. This statement is then removed
as part of the adoption of PS 1202.
The Statement of Changes in Net Debt reports the extent to which expenditures of the
accounting period are met by the revenue recognized in operations for the period. The
statement will also show, if any, the change in debt due to remeasurement gains and losses,
acquisition of tangible capital assets and other allowable changes.
The Statement of Cash Flows shows how a government generated and used cash and cash
equivalents during the year. There are no significant changes in this statement. There is
clarification that the four areas of the statement include operating, capital, investing and
financing activities.
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1C 3A6
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Page 12 of 92
As this section adds an additional statement and changes some presentation standards that
are then amended with the adoption a year or two later by PS 1202, Staff are leaning
towards early adopting, if allowed, PS 1202 to provide usable and predictable financial
reporting. It is felt that significant changes a short period of time could result in user fatigue
or confusion on the meaning of the results of the financial statements.
Foreign Currency Translation, PS 2601
This new standard is a result of the new Financial Instruments section and changes to
Financial Statement Presentation (resulting in the new PS 1201).
The new standard eliminates the deferral of gains and losses arising on the translation of
long-term monetary assets and liabilities; and requires gains and losses, on the translation
of foreign denominated balances that have yet to be settled to be reported as
remeasurement gains and losses.
This standard excludes remeasurement gains and losses from the statement of operations
and will include it in PS 1201 under the Statement of Remeasurement Gains and Losses.
The use of Hedge Accounting is no longer supported for financial statement reporting and
presentation.
The Municipality does not typically hold long-term foreign currency assets and liabilities, it is
not anticipated that this will result in significant changes outside of presentation and
disclosure changes.
Portfolio Investments, PS 3041
Approved in June 2011, this section was created as a result of the adoption of the Financial
Instruments standard. This standard removes the distinction between temporary and
portfolio investments. When temporary investments are not cash equivalents, as defined in
Financial Statement Presentation standards, they are accounted for as portfolio
investments. For the Municipality, investments maturing greater than 90 days would be
considered portfolio investments.
The second change is that the section no longer excludes pooled investment funds from its
scope. For the Municipality this would bring the investments held through the ONE
Investment Inc into this standard. These pooled investments would then be subject to
disclosure, presentation, and measurement standards in PS 3450 as well as PS 3041.
Pooled investments which investments may be treated as equity investments as we have an
interest in the distributed income and residual interest.
Portfolio investments are investments in organizations that do not form part of the
government reporting entity, are not investments in government business enterprises or
loans receivable. They are initially recognized at amortized cost.
Portfolio investments will be separately reported on the statement of financial position with
income separately reported on the statement of operations.
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1C 3A6
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Page 13 of 92
Financial Instruments, PS 3450
Approved in March 2011, this section has been deferred multiple times, it is currently
required to be adopted April 1, 2022 which would therefore be applicable to the
Municipality's 2023 fiscal year.
This standard sets out how to account for and report all types of financial instruments,
including derivatives. Financial instruments include primary instruments (receivables,
payables, equity instruments) and derivative financial instruments (financial options, futures,
forwards, interest rate swaps and currency swaps).
Major changes include the use of fair value for investments, historically most investments
were at cost unless they were impaired. Derivatives and portfolio investments in equity
instruments that are quoted in an active market should be included in the fair value category
of financial instruments.
Changes in fair value will be included in the Statement of Remeasurement Gains and
Losses, or equivalent. There will also be increased disclosure and presentation of financial
risks (credit, liquidity, market and other) and management of them, use of derivatives,
determination of fair value.
Asset Retirement Obligations, PS 3280
This is a new accounting standard which will deal specifically with asset retirement
obligations. An asset retirement obligation is a legal obligation associated with the
retirement of a tangible capital asset. The tangible capital assets which are included in this
section are controlled by the public sector, in productive use, or no longer in productive use
and will include leased tangible capital assets.
The scope of this section does not include contaminated sites (PS 3260), routine
replacement, improper use, unexpected events, alternative uses, or waste and by-products.
For the Municipality, the common occurrence will be as a result of solid waste landfill closure
and post closure liabilities (currently part of PS 3270), or asbestos in our tangible capital
assets. Any asset that we own, where there will be a cost to retire/demolish/restore the
asset after its use could have a liability and a cost associated with it.
An asset retirement obligation is recognized when the following is true:
• There is a legal obligation to incur retirement costs
• The past transaction giving rise to the liability has occurred
• It is expected future economic benefits will be given up; and
• A reasonable estimate of the amount can be made
This standard will have a significant impact on the financial position of the Municipality as
well as added presentation and disclosure information. It is anticipated that there will be
liabilities added to the Statement of Financial Position related to AROs for buildings and
potentially road work.
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1C 3A6
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Page 14 of 92
Fiscal Year 2024
These pronouncements are effective for years beginning on or after April 1, 2023 which
make them applicable to the Municipality's 2024 fiscal year. Early adoption is permitted, in
the case of PSG-8 early adoption is encouraged.
Revenue, PS 3400
Public sector entities receive many types of revenue, including some that are unique to the
public sector (fines, penalties, taxes). Prior to PS 3400 being issued there was no
overarching standard to address the common types of revenue in the public sector. Most
policies for recognition have been based on first principles within Section PS 1150 Generally
Accepted Accounting Principles and Financial Statement Concepts PS 1000.
This new standard establishes reporting and accounting standards for revenue and does not
replace existing standards that provide guidance on recognition such as Tax Revenue PS
3510 or Government Transfers PS 3410 which are already existing. Revenue from
investments or financial instruments are covered in the corresponding sections.
This is a principle -based standard due to the variety of revenue streams that public -sector
entities may have. The section defines exchange transactions (where there is a good or
service provided for consideration), performance obligation (an enforceable promise to
provide a specific good or service), transaction price (the amount of consideration the public
sector entity expects to receive for the exchange) and non -exchange transaction (a
transaction or event where there is no direct transfer of good or service to the payor).
If there is a performance obligation on the part of the Municipality the revenue will be
recognized when (or as) the obligation is met. For example, if there is an annual pass to a
fitness centre the revenue will be recognized during the year.
If there are no performance obligations (for example a parking fine), the revenue is
recognized when the entity has the authority to claim or retain the economic resource
(money or receivable) and the event occurred. This is the current process.
The standard provides examples
• Performance Obligation Satisfied Over a Period of Time
o a park pass, continuing education course, wireless spectrum license
• Performance obligation at a specific point in time
o Driver's license
• Multiple performance obligations
o Sale of a tangible capital asset with servicing
o Building permit
• Hybrid transactions
o Admission fee and donation
• Variable consideration
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1C 3A6
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Page 15 of 92
o Advertising
o Early delivery bonus
Staff will be using these examples and reviewing our current recognition practices to ensure
that we are compliant. At this time, we do not anticipate significant changes as a result of
this accounting standard.
Purchased Intangibles, PSG-8
The following is a public sector guideline, it is not a standard. Guidelines are considered
Generally Accepted Accounting Practices (GAAP) and the Municipality will consider these
guidelines when looking at accounting treatment.
Purchased intangibles are non -monetary economic resources without physical substance
acquired through an arm's length exchange transaction. For PSAB purposes, software is
accounted for through Tangible Capital Assets PS3150 while those acquired as part of a
public private partnership arrangement are accounted for in accordance with Public Private
Partnerships PS 3160. Purchase premiums on the acquisition of a government organization
are accounted for under Investments in Government Business Enterprises (PS 3070) or
Additional Areas of Consolidation PS 2510.
Purchased intangibles are recognized as assets in financial statements provided, they meet
the asset definition and general recognition criteria in Financial Statement Concepts PS1000
(in accounting speak, PS1000 is "first principles" if it doesn't meet the basic definition of an
asset or liability in that section then it isn't an asset or liability).
Purchased intangibles will be treated as a non -financial asset, similar to the current
treatment of software in TCA.
These guidelines already form the basis for many of the decisions that Staff make, and early
adoption is reasonable. It is not expected to impact the financial statements or other
financial decisions that we are making. Software is likely the biggest implication for us, with
the movement to cloud -based software the costs are likely to be expensed in the future as
there is no ownership of the software and the costs are more subscription based.
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1C 3A6
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Page 16 of 92
Exposure Drafts
Exposure Drafts are proposals by PSAB for new standards or guidelines as well as revisions
(both major and minor) to existing standards. The following is taken from the FRAS Canada
website.
Employee Benefits, PS 3251 (Open for Comment)
This exposure draft was released in July 2021 and will be open for comment until November
25, 2021.
The current standards on retirement benefits, post -employment benefits, compensated
absences, and termination benefits, were developed over 20 years ago. These standards
are no longer reflective of the current accounting world or the evolution of pension plans
over that period of time.
This exposure draft focuses on deferral provisions and discount rate guidance. A multi-
phase strategy has been adopted by PSAB with regards to developing new standards for
employee benefits. The International Public Sector Accounting Standard (IPSAS) 39 will be
a starting point for the development of the new Canadian standard.
Financial Statement Presentation, PS 1202
This is an exposure draft which will replace the existing standard PS 1201, which has yet to
be adopted by the Municipality. The "existing standard" PS 1201 will be adopted no later
than the 2023 fiscal year, the proposed PS 1202 will be adopted (as currently proposed) for
the Municipality's 2025 fiscal year.
The proposed reporting model would include the following:
• Statement of Financial Position
• Statement of Net Financial Assets or Net Financial Liabilities (New)
• Statement of Operations
• Statement of Changes in Net Assets or Net Liabilities (New)
• Statement of Cash Flow
• Accompanying notes and schedules
The Statement of Remeasurement Gains and Losses which will be introduced in PS 1201, it
is currently not a required statement, is proposed to be removed under PS 1202. The
Statement of Net Debt has been removed however the information may be included on the
Statement of Net Financial Assets or Net Financial Liabilities.
■ The new reporting model is expected to allow the financial position of the entity to be better
understandable, as it only comprises assets and liabilities. This new model does not include
deferred inflows and outflows or two bottom lines which are included in the PS 1201
standard.
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1 C 3A6
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Page 17 of 92
Staff are considering early adoption of this standard rather than adoption of PS 1201 as it
does not make sense to show users of the financial statements three different models of
presentation in a four-year period. It is a lot of work for staff to revise the statements and
ensure proper linkages to our accounting system for a two-year benefit.
Conceptual Framework for Financial Reporting in the Public Sector
As a standard setter, PSAB routinely looks at its conceptual framework to determine if it is
still relevant and meeting the needs of stakeholders. Work on the conceptual framework has
been underway since 2011. The proposed conceptual framework includes 10 chapters and
is the foundation for how PSAB will create new or revised standards in the future. This
framework touches on areas of accounting which cannot be properly articulated in a short
memo, if members of committee are interested, I would be willing to meet individually, or
present at a future meeting, on the topic.
Consequential Amendments Arising from the Proposed Conceptual
Framework
This is a separate exposure draft where PSAB proposes consequential amendments to
other sections of the CPA Canada Public Sector Accounting (PSA) Handbook resulting from
the new Conceptual Framework.
Consequential Amendments Arising from the Financial Statement
Presentation Standard (Proposed PS 1202)
- This is a separate exposure draft where PSAB proposes consequential amendments to
other sections of the CPA Canada Public Sector Accounting (PSA) Handbook resulting from
the new PS 1202 adoption. Changes include housekeeping amendments based on new
terminology.
Public Private Partnerships (Proposed PS 3160)
There are a wide variety of practices used in Canada for accounting for public private
partnerships. This project looks to enhance the consistency and comparability of information
reported in financial statements for infrastructure acquired through public private partnership
procurement methods.
This exposure draft, if approved, would apply starting in 2023 (April 1, 2022 or later). The
main features are as follows:
• P3 infrastructure is procured by the public sector entity using a private sector partner
that is obligated to design, build, acquire or better; finance; and operate and/or
maintain the infrastructure
• P3 infrastructure is recognized as an asset when the public sector entity acquires
control of the infrastructure. A liability is recognized when the P3 recognizes an asset.
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1 C 3A6
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0 Page 18 of 92
The liability may be a financial liability, a performance obligation, or a combination of
both
• An infrastructure asset acquired in an exchange transaction is recorded at its cost,
which should be the fair market value at the initial measurement date, the liability is
also measured at the cost of the infrastructure asset
• Subsequent measurement of the asset is based on the asset cost amortized in a
rational and systematic manner over the useful life of the asset
• Subsequent measurement of the financial liability would reflect the P3's payment to
settle the liability as well as the finance charges being passed on to the public sector
entity through the P3 agreement
• For subsequent measurement of the performance obligations, the revenues should
be recognized, and the liability reduced in accordance with the substance of the P3
agreement
An operating and maintenance contract is not included in the above scope. These would
continue to be expensed over the life of the service contract in accordance with the
definitions of expenses and liabilities.
The Municipality would be impacted by this standard on the creation of any infrastructure,
for example a community centre, where the private sector designs, builds, acquires, or
betters new or existing infrastructure.
Narrow Scope Amendments
Foreign Exchange Narrow Scope Amendments
Narrow -scope amendments are being proposed to allow all public sector entities to make an
accounting policy election to recognize exchange gains and losses, including the gain or
loss component of changes in fair value, directly in the statement of operations. The
proposed election would be available for any financial asset or financial liability arising from
a foreign currency transaction.
Financial Instruments Presentation Narrow Scope Amendments
The proposals clarify that the remeasurement impact of derivatives may be presented
separately on the statement of change in net debt. Other minor presentation amendments
have also been included.
Financial Instruments Narrow Scope Amendments
The proposed revision to the treatment of debt buybacks will affect how the annual
surplus/deficit is calculated. This is because transactions that previously would have been
considered extinguishments will no longer be treated as such. This will also affect the
presentation of assets and liabilities on the balance sheet. It will not affect net debt.
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1C 3A6
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Page 19 of 92
Purchased Intangibles Narrow Scope Amendments
This draft proposes to remove the exclusion in the conceptual framework prohibiting the
recognition of purchased intangibles in the financial statements. The proposal is limited to
intangibles purchased through an exchange transaction. Removing the recognition
prohibition would address an imbalance, mainly for Indigenous governments, where debt
financing for an intangible asset is recognized on the Statement of Financial Position
(balance sheet) but the related asset is not. The proposal may have implications for other
public sector entities that purchase intangibles.
Conclusion
Staff are monitoring the changes in accounting standards and taking proactive steps to
comment as standards change to provide feedback to PSAB on the impacts these proposed
changes will have. Staff will be looking to early adopt, as appropriate, these standards. Until
the new PS 1202 is approved, the standards to be adopted in 2023 which would require the
adoption of PS 1201 will not be early adopted. Staff feel that it makes the most sense to
avoid the adoption of PS 1201 and move directly to PS 1202 as it would create the least
impact on users of the statement as well as the preparers of the statement.
If there are any questions to the above, please let me know.
,�� (�—te—Larj
Trevor Pinn, CPA, CA
Director of Financial Services/Treasurer
Financial Services Department
cc: Andrew Allison - CAO
Michelle Pick, CPA, CGA — Accounting Services Manager/Deputy Treasurer
Erika Watson, CAMP — Asset Management and Development Financing Manager
Catherine Carr — Internal Audit Manager
The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1C 3A6
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Page 20 of 92
Clarington
Staff Report
If this information is required in an alternate accessible format, please contact the Accessibility
Coordinator at 905-623-3379 ext. 2131.
Report To: Audit and Accountability Committee
Date of Meeting: September 28, 2021 Report Number: IAS-003-21
Submitted By: Trevor Pinn, Director of Financial Services
Reviewed By: Andrew C. Allison, CAO By-law Number:
File Number: [If applicable, enter File Number] Resolution#:
Report Subject: Financial Update as at June 30, 2021
Recommendation:
1. That Report IAS-003-21 be received for information.
Page 21 of 92
Municipality of Clarington
Report IAS-003-21
Report Overview
The COVID-19 pandemic has had a lasting impact on the Municipality of Clarington. It has
changed the way in which we provide services (a strong movement towards online services),
work, and live. The Municipality's most significant financial impact has been the reduction of
services in Community Services. This continued to affect revenues in the first two quarters of
2021 as the second (December to February) and third lock -downs (April to July) impacted
our ability to provide services and have facilities opened.
The attached report provides information on the variances by service area with anecdotal
commentary where appropriate.
1. Background
1.1 The Budget Policy outlines a requirement for the Treasurer to report to Council on a
quarterly basis each year starting with the second quarter. This report fulfills that
reporting requirement.
1.2 To improve the usefulness of the information, and consistency of format with the
annual budget, the quarterly report is attached to this report as Attachment 1. Each
department is broken down by sub -department with the expenses grouped together
like the requirements for financial reporting and the annual budget.
1.3 Where there are key variances, these have been identified and are expanded upon for
Committee's, and the public's, information.
1.4 This report is solely for operating expenses. Finance will be reporting separately on the
capital budget. The capital budget will be reported on semi-annually, once in the fall
which captures the "construction season" to September 30, and once in the spring
which summarizes the prior year's activities.
2. Impact of COVID-19
2.1 Where appropriate, the impact of COVID-19 has been identified and discussed in
Attachment 1.
2.2 Overall, the greatest impact from COVID-19 has been on our Community Services
Department. Public health measures and Provincial orders have resulted in disruptions
to programming and facility services. The Municipality mitigated these disruptions
through staffing reductions in the affected areas.
2.3 The Municipality took steps to provide financial support to taxpayers through flexible
payment arrangements for taxes, deferral programs and financial support to
Page 22 of 92
Municipality of Clarington
Report IAS-003-21
businesses (CIP). There does not appear to be a significant impairment in our tax
receivable and we have not received requests for assistance outside of the normal
levels of request.
2.4 The Municipality has been diligent in applying for, and has been successful, grants
offered by various organizations for both capital and operating funds. Staff continue to
seek out and apply for grant opportunities for the benefit of our community and its
residents.
3. Concurrence
Not Applicable.
4. Conclusion
It is respectfully recommended that the report be received for information.
Staff Contact: Trevor Pinn, Director of Financial Services/Treasurer, 905-623-3379 ext.2602
or tpinn@clarington.net.
Attachments:
Attachment 1 — Financial Update for the Period Ending June 30, 2021
Interested Parties:
There are no interested parties to be notified of Council's decision.
Page 23 of 92
Financial Update as at June 30, 2021
'00
Financial Update for the period ending June 30, 2021
(unaudited)
This report provides an update on the Municipality of Clarington's financial activity through the first and second quarter of
2021. In previous iterations of this report, the financial activity has been presented to compare year to date actuals from
the first prior year and current budget to actual analysis. In 2021, year-to-year comparison do not provide any relevant
information as there have been significant department reorganizations and impactful COVID-19 effects. This report will
continue to provide a financial overview of budget variances as of June 30, 2021, focusing on the variances to the current
year's budget. Essential non -financial functions of the Municipality, such as service level achievements or deficits within
the reported quarter, a review of COVID-19 impacts and department initiatives will also be identified.
COVID-19 Implications
COVID-19 continued to impact business operations in the first and second quarters of 2021. Facilities remained closed
and programs/events were cancelled with the Province -wide lockdown, operating restrictions and tiered reopening
programs.
Three reports have been provided in 2021 to Council regarding impact and mitigation plans for COVID-19 and the steps
taken to provide financial support to the community. These include:
• 2021 COVID-19 Property Tax Deferral Program- FSD-003-21
• 2021 COVID Support for Hall Board- FSD-023-21
• Proposed Amendment to the COVID-19 Community Improvement Plan (CIP)- PDS-034-21
The Province of Ontario and the Government of Canada have opened more funding opportunities for Municipalities to
mitigate COVID-19 expenses and pressures. These programs include application -based capital grants as well as formula -
Page 25 of 92
based operating grants. The Municipality continues to seek out grant opportunities to mitigate financial impacts to the
Municipality as well as provide increased services to our residents
Taxes Receivable/Collected
The first-quarter tax revenue (Taxes Billed) totalled $47,846,754, which is on trend with prior years. The second quarter
saw $90,302,069 in tax revenue (Taxes Billed). We would normally see this amount for the second quarter, with the
instalments rolled out on time in 2021. Per Council's direction, the June 2020 instalment of the final tax bill was moved to
July 2020 to provide COVID-19 relief to our taxpayers. This tax relief initiative was not reinstated in 2021; however, there
were other payment options made available to taxpayers to address COVID-19 financial pressures. Some of which
included changes to the pre -authorized payment(PAP) program and creating a Tax Deferral Program. This new program
provided qualifying taxpayers with a 60-day extension on the interim tax due dates to assist with cash flow issues resulting
from the second wave of COVID-19.
The taxes receivable at the end of the second quarter are trending back to normal for this time of the year at $14,889,441.
The Municipality has a commercial installment date in August and an installment date for all taxpayers in September.
Grants
Through Elexicon and Save -ON -Energy's Retrofit program, Clarington received incentive funds for three retrofit projects.
Under the program, incentives can be acquired for a variety of energy -efficient measures available in three areas:
Lighting, HVAC, and Manufacturing and other equipment. Clarington submitted applications and was approved for
lifecycle replacement of air-cooled chiller at MAC, MAC variable frequency drives for energy conservation and lifecycle
replacement of electrical controls at Newcastle Memorial Arena.
A grant for $7,000 was received from the Department of Canadian Heritage to support Canada Day Events. This year,
Clarington collaborated with the Region of Durham and all eight municipalities to provide COVID-19 safe Canada Day
Page 26 of 92
celebrations. Some of the events planned included a 3-part virtual show airing on Rogers with a family -specific segment,
local musicians and local demonstrations, celebration kits- pancake breakfast, mural mosaic and drivable scavenger hunt,
among others. To recognize and pay respect to the victims, survivors and families of those impacted by the discovery of
the graves of First Nations children at residential schools, the Region released a statement to cancel the virtual show.
Clarington refocused our celebration events with a social media takeover by Mississaugas of Scugog Island First Nation.
The supplies for pancake breakfast kits and mural mosaic were repurposed for a separate activity to occur later in the
year. The mural tiles, when released to the community, are picked up in a kit which includes the pancake breakfast
supplies. Our Tourism division also used some of the pancake kits as a part of their summer "Tourism Pop-Up's," while
some were donated to the Clarington East Food Bank.
Another installment for the Federation of Canadian Municipalities (FCM) grant was received to support Clarington's
participation in the Municipalities for Climate Innovation Program (MCIP). The MCIP supports municipalities in developing
a response to climate change that protects residents, the environment and the economy. Funds received from the
program are subsidizing the Climate Change Response Coordinator position, working with the Interdepartmental Climate
Change Working Group to develop the Clarington Climate Action Plan and other climate initiatives in the Municipality.
The Tourism Industry Association of Ontario (TIAO) provided grant funding to the Municipality for local tourism marketing
efforts during the first quarter of 2021 to support COVID-19 recovery. As outlined in the report to Council CSD-004-21, the
Tourism team started collaborating with Customer Services and Facility Services to create Tourism displays within all of
Clarington's recreation facilities. These have been designed and are being installed as an initiative through FedDev
Ontario grant. These new displays will provide the visitors to our recreation facilities information on local and regional
tourism attractions.
In August 2020, the Province of Ontario announced funding for the Safe Restart Program. The Municipality was allocated
$903,000 for this program in the first quarter of 2021. Funding under this program provides support for expense and
revenue pressures associated with the COVID-19 pandemic. Further funds were made available to Ontario Municipalities
Page 27 of 92
in March 2021, under the 2021 Provincial COVID-19 Recovery Funding for Municipalities program. These funds will help
municipalities address their 2021 COVID-19 related operating impacts. Clarington will receive two equal instalments with
the first instalment received in the second quarter of 2021 in the amount of $866,858. The second installment will be
received in the fourth quarter of 2021. These funds will be used to address, for example, shortfalls in revenue from the
prolonged closure of facilities, added cost of cleaning and personal protective equipment, financial support of local
organizations, including hall boards and arena boards.
To increase the accessibility to the Municipality's trails and park network, Community Services applied for the Ministry of
Seniors and Accessibility — Inclusive Community Grant Program. The Municipality was successful in its application for
$51,716.05 to provide accessible charging stations for mobility devices throughout the community. These infrastructure
improvements will allow all residents the ability to visit parks, trails and open spaces which are vital for stress relief,
mental and physical health and socializing safely through the restrictions related to COVID-19. Charging stations will be
installed at these locations:
• Tooley's Mill Park (Courtice) — connection to Farewell Creek Trail
• Guildwood Park (Bowmanville) — connection to Soper Creek Trail
• Port Darlington East Beach Park (Bowmanville)
• Orono Park (Orono)
• Orono Town Hall (exterior) (Orono)
• Bond Head Parkette (Newcastle)
• Samuel Wilmot Trail (Cobbledick entrance) (Newcastle)
The initial payment of the Audit and Accountability Funds was received from The Ministry of Municipal Affairs and Housing
in the second quarter. Clarington was 1 of 34 municipalities to apply and receive these funds. A customer service review
will be performed in 2021 with these funds.
Page 28 of 92
During the second quarter of 2021, Clarington received a grant from The Solicitor General and the Fire Safety Grant
Program. These funds will be used to purchase electronic training equipment for each fire station to allow for remote
training opportunities and reduce the potential risk of spreading COVID-19.
Development Charges Collected
Residential and non-residential development charges collected as of June 30, 2021, were $6,979,100.
As of June 30, 2021, residential municipal development charges collected were $6,625,171 compared to $4,599,750 in
2020. The 2020 Development Charges Background Study forecasted that the Municipality would be collecting
approximately 1,135 units in total for 2021, or about 567 units at the end of the second quarter. Development charges
have been collected for 370 units as at June 30, 2021. The development charges collected are significantly higher
compared to 2020. Staff attribute this increase to the type of residential units. This year has seen the issuance of more
single and semi-detached units which have a higher DC fee.
At the end of the second quarter our website was updated to include a Growth Trends Review as at year end 2020. This
report highlights emerging development -related issues and trends within the Municipality of Clarington. Building permit
activity and other related data are indicators of housing and employment activity within Clarington. This report can be
found using our website https://www.clarington.net/en/do-business/Growth-Trends-Review.asp
Page 29 of 92
Municipality of Clarington - Municipal Development Charges January 1 to June 30, 2021
2021
i
RESIDENTIAL
Municipal Development
Number of
Municipal Development
Number of
Charges Paid
Units
Charges Paid
Units
Single/Semi-Detached
-New construction
$ 3,360,727
162
$ 2,322,094
129
-Additions
-
-
-
-
Townhouse
3,264,444
208
2,277,656
166
Apartment
-
-
-
-
TOTAL:
$ 6,625,171
370
$ 4,599,750
295
Change in DC paid from prior year: 44.0%
Change in DC units from prior year: 25.4%
NON-RESIDENTIAL
Municipal Development Charges
Paid
Municipal Development Charges
Paid
Commercial
-New construction
$ 353,929
$ 4,128
-Additions
-
-
Industrial
-New construction
-
334,484
-Additions
-
-
Agricultural
-
-
Government
-
-
Institutional
-
-
TOTAL:
$ 353,929
$ 338,612
Change in DC paid from prior year:
4.5%
Page 30 of 92
Municipal Development Charge Incentives
In the 2015 Development Charges By-law 2015-035, there were several incentives to encourage development in
Clarington. These incentives mainly relate to multi -residential, commercial and industrial development. Since July 2015,
there has been a total of $1,555,277 in development charge incentives given to 15 properties. The split is approximately
37% and 63% between residential and non-residential properties, respectively. Note that discretionary incentives are
required to be covered by the Municipality's tax base. The 2020 Development Charges Study, passed in 2021, removed
specific incentives that were considered not widely used or no longer required due to legislative changes. There have
been no new incentives given in 2021 as of June 30, 2021.
Property.-
2015
2016
2017i
of Total
Mid -Rise Residential
$ -
$ 413,822
$ -
$ -
$-
$ 413,822
Revitalization, Mixed Use
157,840
157,840
Residential
-
413,822
157,840
-
-
571,662
37%
Medical Exemption
110,671
110,671
Revitalization, Small
3,636
938
974
5,548
Business
Existing Industrial
22,983
22,983
Development
Conversion Residential to
15,985
15,985
Commercial
New Industrial Development
102,718
652,823
755,541
Revitalization, Mixed Use
72,886
72,886
Non -Residential
114,307
39,906
176,578
652,823
-
983,614
63%
Total
$ 114,307
$ 453,728
$ 334,418
$ 652,823
-
$1,555,277
100%
Page 31 of 92
Staffing Updates
There was 624 staff (not including those on leave) as of June 30, 2021. Prior to COVID-19, there were 809 employees
including Mayor and Council (7), temporary staff, volunteer firefighters and employees on leave (this does not include
Library or Museum). As a result of COVID-19, 102 part-time staff (including crossing guards) were placed on an Infectious
Disease Emergency Leave (IDEL) as our facilities and schools were closed through the first and second quarters. There
were four retirements from January to June 2021.
Page 32 of 92
Municipal Operating Revenues and Expenses
Overview - Financial Results
This financial update report focuses on overall (unaudited) budget variances for the period ending June 30, 2021. The
reporting has expanded to show budget to actual variances by sub -department. The department summaries indicate the
status of the Municipality's operating accounts compared to the approved budget as of June 30, 2021.
Many of the operations of the Municipality are impacted by seasonal trends such as ice rentals and winter control. The
timing of other activities can fluctuate from year to year, such as legal and planning revenues. To best capture the trends,
the budget is allocated monthly based on the prior year's actual monthly distribution. In cases where there is no previous
history, the monthly allocation is divided equally over the twelve months.
Due to timing differences, variations from quarter -to -quarter and year-to-year exist. Therefore, this statement cannot be
used in isolation, nor can it be easily extrapolated to predict the whole year's activities.
Each department is responsible for its budget. To assist management, monthly trial balances are sent by the Financial
Services Department to each department for regular review.
The Summary of Operating Revenues and Expenditures compares the Municipality's budget to actual transactions as of
June 30, 2021, reflecting financial activity through the first and second quarters of 2021. The tables below reflect the
Municipality's operating budget only and exclude the year-to-date financial activities of the library, museum and BIA's.
Page 33 of 92
2021
121
2021
2021• .
Actuals
Budget
Unassigned
$ (9,769)
$ 0
$ 0
Non -Departmental Accounts
(66,280,373)
(70,000,671)
(79,044,602)
16.1
Mayor and Council
341,780
415,018
810,336
57.8%
Office of the CAO
950,744
1,035,749
1,755,525
45.8%
Legislative Services
1,765,931
2,776,840
4,985,589
64.6%
Financial Services
3,240,127
5,016,730
7,325,502
55.8%
Emergency and Fire Services
6,413,420
7,022,866
13,524,026
52.6%
Public Works
14,987,319
17,236,924
27,448,416
45.4%
Community Services
8,275,632
8,229,215
13,914,614
40.5%
Planning and Development Services
1,237,533
3,260,520
4,474,072
72.3%
Levies
(34,167,085)
(63,058,164)
0
0.0%
BIAs
213,439
213,439
0
0.0%
Libraries/Museums
3,914,674
1,537,361
3,671,599
-6.6%
Culture
216,099
212,466
219,366
1.5%
External Agencies
803,557
915,557
915,557
12.2%
Total Municipality of Clarington
$ (58,094,683)
$ (85,186,150)
$ 0
Page 34 of 92
Revenue and Expense Categories
Revenues and expenses are categorized based on their
purpose and similarities.
Revenues
Estimated taxation, supplementary taxation, and
payments -in -lieu of taxation received. These funds are
collected on behalf of the Region of Durham, the
Province of Ontario or a school board and are remitted to
the specific agency.
,rovincial Grants and Subsidies
Grants received from the Province of Ontario for specific
functions such as the Ontario Community Infrastructure
Fund or specific grant projects.
,=ederal Grants and Subsidies
Grants received from the Government of Canada for
specific functions such as the Federal Gas Tax Fund or
specific grant projects.
User Fees
Fees for services include facility rentals, cemetery fees,
application for planning and building permits, and
recreational programming.
Licensing and Lease Revenue
Licensing fees such as taxi licensing and lease revenues
for the long-term lease of municipal facilities and
property.
Investment Income
All investment income earned by the Municipality through
its investment holdings, bank account balances and
investment in Elexicon.
Contributions from Reserves
Contributions from reserves and reserve funds for
specific purposes, as identified within the budget. This is
an internal source of funding and may be originally
sourced from taxation, grants or user fees.
Other Revenues
Any revenue that is not otherwise categorized.
Page 35 of 92
Expenses
Salaries and BenefitE,
Compensation for all employees such as salaries, wages,
benefits, overtime, allowances and statutory benefits.
Materials
Includes items such as office supplies, salt and sand,
gravel, insurance costs, phone costs and other general
expenses.
Rent and Financial Costs
Bank charges, debit and credit card charges, cost of
rental equipment and facility rentals for the Municipality
Purchase/Contracted Services
Items that are outsourced, such as professional services,
winter clearing and IT software as a service.
Debt Repayment
Interest on debt repayments to external parties
Grants and Transfer Payments
Grants provided to community groups, external boards
and agencies and levies from other organizations.
Contributions to Reserves and Reserve Funds
Contributions from the general fund for the Municipality's
reserves and reserve fund
Page 36 of 92
Mayor and Council
100 Mayor
Expenditures
Salaries, Wages & Benefits
$ 120,000
$ 125,927
$ 249,108
51.8%
Materials & Supplies
5,226
34,112
59,341
91.2%
105 Council
Expenditures
Salaries, Wages & Benefits
203,728
216,052
430,517
52.7%
Materials & Supplies
381
5,675
9,070
95.8%
106 Ward Council
Expenditures
Materials & Supplies
7,136
20,300
38,300
81.4%
107 Regional Council
Expenditures
Materials & Supplies
5,309
12,952
24,000
77.9%
Total Mayor & Council
$ 341,780
$ 415,018
1 $ 810,336
57.8%
Highlights
There were no items of interest to highlight for the period ending June 30, 2021 for the Mayor and Council departments.
Page 37 of 92
Administration
Total
Description YTD
YTD
Final
Unexpended
BudgetActuals
..-
000 Unassigned
Expenditures
Materials & Supplies $ 374,367
$ 377,418
$ 377,418
0.8%
130 Admin
Expenditures
Salaries, Wages & Benefits 228,310
287,871
562,256
59.4%
Materials & Supplies 7,737
15,608
56,425
86.3%
Contracted Services 458
375
30,000
98.5%
170 Communication
Revenue
User Charges 0
(15,000)
(15,000)
100%
Expenditures
Salaries, Wages & Benefits 262,735
296,643
584,601
55.1 %
Materials & Supplies 38,621
40,411
104,400
63.0%
Contracted Services 27,257
38,438
55,425
50.8%
385 Environmental
Revenue
User Charges (44,603)
(45,156)
(83,500)
46.6%
Expenditures
Materials & Supplies 4,286
3,500
3,500
-22.5%
Contracted Services 51,576
35,641
80,000
35.5%
Total Administrator's Office
$ 950,744
$ 1,035,749
$ 1,755,525
45.8%
Page 38 of 92
Highlights
Communication
The Communication division is working on the website refresh. The new website will be launching in mid to late
September 2021.
There is no budget for Communications Wages Temp PT but there was a need to create a position for the P/T screening
staff. This position currently falls under the Office of the CAO. Although this position was not budgeted, we will be able to
use funds from COVID-19 Safe Restart Grant as it was a direct cost related to responding to COVID-19 public health
measures.
Environmental
Materials and Supplies are over budget by $786 (22.5%), this is due to advertising which is not recoverable by Canadian
Nuclear Laboratories (CNL).
Page 39 of 92
Legislative Services
130 Admin
Revenue
User Charges
$ (69,344)
$ (65,572)
$ (122,800)
43.5%
Expenditures
Salaries, Wages & Benefits
422,176
511,366
1,008,646
58.1 %
Materials & Supplies
30,723
41,549
86,010
64.3%
Contracted Services
4,035
5,010
10,800
62.6%
Transfers from RES / RF / CAP Fund
73,500
68,548
73,500
0.0%
160 HR/Payroll
Expenditures
Salaries, Wages & Benefits
358,695
846,763
1,437,829
75.1 %
Materials & Supplies
2,669
7,896
12,600
78.8%
Contracted Services
12,906
27,987
82,000
84.3%
Rents/Financial Expenses
43,809
78,345
140,000
68.7%
165 Health & Safety
Expenditures
Materials & Supplies
13,655
10,953
23,075
40.8%
Contracted Services
0
12,000
12,000
100.0%
Transfers from RES / RF / CAP Fund
2,500
2,500
2,500
0.0%
190 Animal Services
Revenue
User Charges
(34,374)
(42,424)
(87,800)
60.8%
Expenditures
Salaries, Wages & Benefits
187,689
225,935
447,579
58.1 %
Page 40 of 92
Materials & Supplies
21,097
32,476
67,925
68.9%
Contracted Services
31,134
26,025
59,000
47.2%
Transfers from RES / RF / CAP Fund
10,000
6,565
10,000
0.0%
191 Municipal Law Enforcement
Revenue
User Charges
(14,656)
(23,381)
(28,000)
47.7%
Fines/Penalties on Interest
(3,676)
(11,577)
(25,000)
85.3%
Expenditures
Salaries, Wages & Benefits
420,841
449,910
885,842
52.5%
Materials & Supplies
4,441
8,705
21,000
78.9%
Contracted Services
17,280
34,706
54,100
68.1%
192 Parking Enforcement
Revenue
User Charges
0
(30,707)
(80,000)
100.0%
Fines/Penalties on Interest
45
(78,663)
(250,000)
100.0%
Expenditures
Salaries, Wages & Benefits
195,439
207,873
416,963
53.1 %
Materials & Supplies
3,705
9,454
24,840
85.1 %
Contracted Services
8,546
4,617
10,000
14.5%
Rents/Financial Expenses
3,519
3,336
10,000
64.8%
Transfers from RES / RF / CAP Fund
330,000
109,090
330,000
0.0%
193 Election
Expenditures
Contracted Services
3,943
4,000
4,000
1.4%
Transfers from RES / RF / CAP Fund
125,000
125,000
125,000
0.0%
Page 41 of 92
194 Legislative Services
Revenue
User Charges
(66,689)
(26,790)
(58,000)
-15.0%
Expenditures
Salaries, Wages & Benefits
193,748
186,955
365,730
47.0%
Materials & Supplies
10,798
22,055
37,800
71.4%
Contracted Services
0
43,476
75,000
100.0%
230 Grants
Revenue
Grants
(13,571)
(527)
(22,000)
38.3%
250 Contributions
Revenue
Transfer between Funds
(461,803)
(461,803)
(461,803)
0.0%
326 Cemetery
Revenue
User Charges
(110,120)
(72,808)
(208,100)
47.08%
Expenditures
Materials & Supplies
0
1,800
1,800
100.00%
388 Fleet
Expenditures
Materials & Supplies
8,271
16,194
31,750
73.9%
Total Legislative Services
$ 1,765,931
$ 2,315,037
$ 4,523,786
64.6%
Highlights
Clerk's (Administration)
In the first quarter, with the Provincial restrictions put in place, our process changed to offer services (ceremonies and
licenses) to Clarington residents only to avoid travel between regions. During the second quarter lockdown, booking
ceremonies ended. With easing of restrictions from the April lockdown, marriage ceremonies are picking up now and
ceremony proceedings have opened back up to all Durham Region residents.
Page 42 of 92
With COVID-19 mitigation efforts in effect, many events, contracts and programs were cancelled. Refunds for Bingo
License Fee, reduced spending on travel and delays on contract fulfillment were seen through the first and second
quarters of 2021.
With the upcoming transition to SharePoint, the funds from the Records Retention account to upgrade Laserfiche will be
reallocated. Staff anticipates there being some funds used for scanning between now and the end of 2021.
Health and Safety
Professional Fees for workplace and audiometric testing have been postponed due to COVID-19. It has been
rescheduled for the fall of 2021.
COVID-19 has impacted the training opportunities for Health and Safety (i.e. annual training day, refreshers and
certifications). As the COVID-19 restrictions lesson, this will hopefully change in the remainder of 2021.
Miscellaneous Operating Supply account is slightly over budget for additional COVID-19 supplies including masks,
protective eyewear, etc. These additional costs are able to be covered by the Provincial Safe Restart and COVID-19
Recovery grants, the allocation of these funds will be determined at year-end once the complete financial picture of the
impact of COVID-19 is available.
Health and Safety books were required to be provided to all members of the Health and Safety committee plus those in
supervisory positions. This is the reason the Books and Periodicals account is slightly over budget, each year funds are
carried over to smooth the expense of these legislated books.
Human Resources
Consulting and Professional Fees had certain expenditures put on hold due to COVID-19. As the COVID-19 restrictions
lesson, this will hopefully change in the remainder of 2021.
Page 43 of 92
Animal Services
Cleaning Supplies expenses are higher than we have seen in the past due to large price increases of cleaning products.
Similarly, with the increase of cleaners required from two days to five days a week, the Janitorial Control expenses are
nearing the budget limit. There were also several invoices for 2020 received late and paid in 2021.
Legislative Services
The Planning Department is processing more developments which has created more agreements and thus the revenues
flowing through the Plan Agreement Fee account have increased
Parking Enforcement
Parking enforcement ticket and meter revenues were collected in the amount of $101,912 and $40,272 respectively. The
accounting entry will be done to be reallocate the revenues to the General Fund accounts from the appropriate Reserve
Fund in the third quarterof 2021.
Cemetery
We are continuing to see higher than budgeted revenues in Bond Head Cemetery. This is due to sales of a new
columbarium installed three years ago. Staff also attribute the increase to a population increase in the area, and people
are purchasing graves near their hometown.
Page 44 of 92
Financial Services and Unclassified Administration
000 Unassigned
Revenue
Fines/Penalties on Interest
$ 6,982
$ (6,374)
$ (15,000)
146.5%
130 Admin
Revenue
User Charges
(71,398)
(63,157)
(200,000)
64.3%
Fines/Penalties on Interest
(747,327)
(700,002)
(1,400,000)
46.6%
140 Internal Audit
Expenditures
Salaries, Wages & Benefits
77,076
79,424
154,743
50.2%
Materials & Supplies
0
150
300
100.0%
162 IT
Expenditures
Salaries, Wages & Benefits
688,043
762,548
1,497,831
54.1 %
Materials & Supplies
4,843
3,600
8,200
40.9%
Contracted Services
4,293
3,610
15,000
71.4%
Transfers from RES / RF / CAP Fund
300,600
300,600
300,600
0.0%
Reclass: CF (NON-TCA) to GF
497,472
427,850
600,000
17.1 %
210 Finance Admin
Expenditures
Salaries, Wages & Benefits
1,418,665
1,561,793
3,082,732
54.0%
Materials & Supplies
54,825
47,806
101,190
45.8%
Contracted Services
45,018
31,145
54,000
16.6%
Page 45 of 92
Highlights
Unassigned
The Fines/Penalties on Interest section of the Unassigned sub -department is sitting with a debit balance at the end of the
second quarter. The biggest contributor to this is the reversal of a 2020 duplicate invoice and the related reversal of the
finance charges applied in error. This is a one-time occurrence and has now been rectified.
IT
During the first half of the year, the Municipality converted existing phone jacks to data jacks. This conversion will allow
the Municipality to accommodate additional staff in existing work spaces. The Planning and Development Services
Department, IT division and part of Fire Station 1 have been converted to allow for these additional staff.
Page 46 of 92
Emergency and Fire Services
130 Admin
Revenue
User Charges
$ (259,245)
$ (66,976)
$ (115,000)
-125.4%
Expenditures
Salaries, Wages & Benefits
452,945
496,279
958,880
52.8%
Materials & Supplies
85,701
112,650
234,050
63.4%
External Transfers to Others
7,750
1,200
10,000
22.5%
Transfers from RES / RF / CAP Fund
637,500
637,500
637,500
0.0%
280 Fire Prevention
Revenue
User Charges
(8,977)
(40,590)
(44,500)
79.8%
Expenditures
Salaries, Wages & Benefits
374,851
408,482
796,825
53.0%
Materials & Supplies
1,904
3,250
45,000
95.8%
Contracted Services
0
1,000
1,000
100.0%
281 Fire Suppression
Expenditures
Salaries, Wages & Benefits
4,163,352
4,419,895
8,634,223
51.8%
Materials & Supplies
33,864
21,744
90,000
62.4%
Contracted Services
25,380
22,867
80,000
68.3%
282 Fire Training/Technical Support
Expenditures
Salaries, Wages & Benefits
132,377
187,433
364,141
63.6%
Materials & Supplies
547
2,283
6,500
91.6%
Page 47 of 92
2021
20211
1 • .
Description
YTD
YTD
Final
Unexpended
Actuals
Budget
Budget',
283 Fire Communication
Expenditures
Contracted Services
296,010
290,985
623,000
52.5%
284 Fire Mechanical
Expenditures
Materials & Supplies
32,388
54,845
115,000
71.8%
285 All Stations - P/T Admin
Expenditures
Salaries, Wages & Benefits
346,934
442,083
865,215
59.9%
Materials & Supplies
16,059
24,549
46,700
65.6%
Contracted Services
4,684
1,234
6,500
27.9%
286 Municipal Emergency Measures
Revenue
User Charges
0
(10,000)
(10,000)
100.0%
Expenditures
Materials & Supplies
1,092
17,591
26,950
95.9%
Contracted Services
0
5,000
5,000
100.0%
287 Mechanical Technical Support
Expenditures
Salaries, Wages & Benefits
68,304
75,413
147,042
53.5%
Total Emergency and Fire Services
$ 6,413,420
$ 7,108,717
$ 13,524,026
52.6%
Page 48 of 92
Highlights
Administration
User charges include an invoice to OPG for the 2021 annual payment as per the Memorandum of Understanding with the
Municipality of Clarington and OPG.
There was a vacancy in the Administration sub -department with a retirement which would account for some of the lower
than expected Salaries, Wages & Benefits expenses for this time of the year.
Fire Training/Technical Support
There was a vacancy in the Fire Training sub -department with a retirement which would account for some of the lower
than expected Salaries, Wages & Benefits expenses for this time of the year.
Fire Prevention
The cancellation of the Junior Firefighter Program, as a result of COVID-19, will result in unspent student wages in
2021.The Municipality is anticipating being able to run the program in 2022, in accordance with public health guidelines in
place at that time.
Page 49 of 92
Public Works
000 Unassigned
Revenue
User Charges
$ (34,010)
$ (166,315)
$ (209,300)
83.8%
Expenditures
Salaries, Wages & Benefits
1,464
1,681
3,000
51.2%
Materials & Supplies
47,930
21,865
90,834
47.2%
Contracted Services
1,400
180
1,000
-40.0%
130 Admin
Revenue
User Charges
(165,015)
(151,225)
(310,800)
46.9%
Expenditures
Salaries, Wages & Benefits
2,487,360
2,700,810
5,286,990
53.0%
Materials & Supplies
36,949
50,153
109,050
66.1%
Contracted Services
9,546
225,719
226,000
95.8%
Debt Services (Principle and Interest paid)
481,928
546,623
546,623
11.8%
Transfers from RES / RF / CAP Fund
5,723,536
5,723,536
5,723,536
0.0%
250 Contributions
Revenue
Transfer between Funds
(495,000)
(495,000)
(495,000)
0.0%
324 Street Lighting
Revenue
User Charges
(3,319)
(921)
(15,000)
77.9%
Expenditures
Materials & Supplies
240,798
335,251
700,000
65.6%
Page 50 of 92
Contracted Services
102,456
119,434
280,000
63.4%
Debt Services (Principle and Interest paid)
(21,214)
0
219,670
109.7%
Transfers from RES / RF / CAP Fund
100,000
100,000
100,000
0.0%
325 Parks
Expenditures
Salaries, Wages & Benefits
602,718
603,708
1,193,058
49.5%
Materials & Supplies
271,791
152,021
569,600
52.3%
Contracted Services
187,675
441,919
1,489,760
87.4%
Rents/Financial Expenses
16,404
3,018
48,000
65.8%
Transfers from RES / RF / CAP Fund
1,157,900
1,157,900
1,157,900
0.0%
326 Cemetery
Revenue
User Charges
(74,296)
(62,035)
(143,000)
48.0%
Expenditures
Salaries, Wages & Benefits
93,118
170,312
339,392
72.6%
Materials & Supplies
62,223
42,844
98,700
37.0%
Transfers from RES / RF / CAP Fund
55,000
55,000
55,000
0.0%
327 Parking Lots
Expenditures
Debt Services (Principle and Interest paid)
(14,273)
0
0
0.0%
330 Roads & Structures
Expenditures
Contracted Services
0
0
12,000
100.0%
334 Safe Roads
Expenditures
Materials & Supplies
1,640
5,755
18,500
91.1 %
Page 51 of 92
Contracted Services
17,014
488
50,000
66.0%
350 Waste Collection
Revenue
User Charges
(48)
(21,654)
(22,500)
99.8%
Expenditures
Materials & Supplies
0
22,500
22,500
100.0%
351 Recycling Collection
Revenue
User Charges
(15)
(1,500)
(1,500)
99.0%
Expenditures
Materials & Supplies
0
1,500
1,500
100.0%
380 Road Maintenance
Revenue
User Charges
(225)
(13,238)
(19,500)
98.8%
Expenditures
Salaries, Wages & Benefits
225,333
221,214
624,000
63.9%
Materials & Supplies
260,235
273,673
942,775
72.4%
Contracted Services
197,696
324,079
915,200
78.4%
381 Hardtop Maintenance
Expenditures
Salaries, Wages & Benefits
200,952
240,315
463,000
56.6%
Materials & Supplies
105,904
101,062
520,500
79.7%
Contracted Services
(270)
0
160,000
100.2%
382 Isetop Maintenance
Expenditures
Salaries, Wages & Benefits
37,845
32,608
59,500
36.4%
Page 52 of 92
Materials & Supplies
92,359
84,092
341,000
72.9%
383 Winter Control
Revenue
User Charges
(5,352)
(1,773)
(20,000)
73.2%
Expenditures
Salaries, Wages & Benefits
495,516
633,194
958,600
48.3%
Materials & Supplies
1,071,905
1,323,418
2,072,500
48.3%
384 Safety Devices
Expenditures
Salaries, Wages & Benefits
102,097
116,814
228,000
55.2%
Materials & Supplies
118,047
203,344
397,500
70.3%
Contracted Services
8,102
0
50,000
83.8%
386 Storm Water Management
Expenditures
Salaries, Wages & Benefits
365
10,832
20,000
98.2%
Materials & Supplies
51
2,584
13,000
99.6%
Contracted Services
0
10,000
92,000
100.0%
387 Regional Roads
Expenditures
Salaries, Wages & Benefits
3,444
7,134
9,000
61.7%
Materials & Supplies
16,223
25,825
35,000
53.6%
388 Fleet
Revenue
User Charges
(740,399)
0
0
0.0%
Expenditures
Salaries, Wages & Benefits
320,471
437,585
751,228
57.3%
Page 53 of 92
Transfers from RES / RF / CAP Fund
1,085,000
1,085,000
1,085,000
0.0%
Total Public Works
$ 14,987,319
$ 17,236,924
$ 27,448,416
45.40%
Highlights
Unassigned
Although the Unassigned Contracted Services looks to be over budget by $400 (40%), the budget for this is an estimate
and depends on accident related recoveries every year. This is an expense that is fully recoverable.
Administration
Low revenues have experienced across all sub -departments; however, decreases in Sport Fields revenue and Region
Waste revenue- as we are not selling blue boxes or bag tags- are impacted by COVID-19 restrictions. Cemetery
revenueis market driven and cannot be anticipated.. Entrance Culvert revenue will increase in the third quarter as it is a
seasonal operation (this work cannot be performed in the cold weather as the ground is frozen.)
Street Lighting
The Street Lighting Debt Services account is reconciled differently than the other Debt accounts as this is an internal loan
from our Reserve Fund, not a Debenture repayment.
Fleet
The Fleet Miscellaneous Operating Supply account is rolled up into the materials and supplies category making it look like
it is over budget however fleet revenues offset this account's expenses.
Page 54 of 92
Community Services
130 Admin
Revenue
User Charges
$ (2,324)
$ (21,500)
$ (21,500)
89.2%
Expenditures
Salaries, Wages & Benefits
451,803
474,238
928,606
51.3%
Materials & Supplies
13,338
29,483
62,325
78.6%
Transfers from RES / RF / CAP Fund
1,273,700
1,273,700
1,273,700
0.0%
420 Recreation Services Admin
Revenue
User Charges
0
(1,040)
(1,230)
100.0%
Expenditures
Salaries, Wages & Benefits
454,906
509,257
993,041
54.2%
Materials & Supplies
2,143
8,973
19,400
89.0%
421 Facilities
Revenue
User Charges
(138,524)
(1,093,011)
(1,969,479)
93.0%
Expenditures
Salaries, Wages & Benefits
1,656,119
2,191,944
4,342,760
61.9%
Materials & Supplies
993,362
1,489,960
3,152,495
68.5%
Contracted Services
133,168
182,541
317,107
58.0%
Debt Services (Principle and Interest paid)
1,478,516
1,476,439
1,514,261
2.4%
Transfers from RES / RF / CAP Fund
1,144,050
1,144,050
1,144,050
0.0%
423 Concessions
Revenue
Page 55 of 92
User Charges
0
(34,005)
(34,990)
100.0%
424 Aquatic Programs
Revenue
User Charges
(99,173)
(611,661)
(776,373)
87.2%
Expenditures
Salaries, Wages & Benefits
36,218
361,378
705,749
94.9%
Materials & Supplies
1,713
27,538
53,889
96.8%
425 Fitness Programs
Revenue
User Charges
(31,321)
(407,497)
(436,454)
92.8%
Expenditures
Salaries, Wages & Benefits
28,978
155,159
305,547
90.5%
Materials & Supplies
1,566
9,263
27,850
94.4%
426 Recreation Programs
Revenue
User Charges
(2,237)
(199,787)
(309,085)
99.3%
Expenditures
Salaries, Wages & Benefits
8,673
144,552
284,029
96.9%
Materials & Supplies
1,897
12,766
37,580
95.0%
Contracted Services
0
23,500
23,500
100.0%
Rents/Financial Expenses
0
1,000
1,000
100.0%
427 Community Development
Revenue
User Charges
(71,350)
(98,410)
(164,650)
56.7%
Expenditures
Salaries, Wages & Benefits
3,411
38,186
76,209
95.5%
Page 56 of 92
Materials & Supplies
66,467
74,838
182,330
63.5%
Contracted Services
5,597
18,445
43,000
87.0%
428 55+ Active Adults
Revenue
User Charges
(6,304)
(96,021)
(122,347)
94.8%
Expenditures
Salaries, Wages & Benefits
10,716
51,111
102,242
89.5%
Materials & Supplies
693
10,796
12,600
94.5%
Contracted Services
0
5,500
5,500
100.0%
Rents/Financial Expenses
0
0
0
0
429 Customer Service
Revenue
User Charges
(377)
(13,643)
(16,500)
97.7%
Expenditures
Salaries, Wages & Benefits
247,711
464,495
921,464
73.1 %
Materials & Supplies
1,465
67,355
93,146
98.4%
440 Libraries
Expenditures
Materials & Supplies
856
1,601
4,100
79.1 %
Contracted Services
2,697
2,877
6,915
61.0%
Debt Services (Principle and Interest paid)
75,230
75,206
78,466
4.1 %
450 Client Services
Expenditures
Salaries, Wages & Benefits
252,884
298,547
585,699
56.8%
Materials & Supplies
4,658
12,672
17,650
73.6%
451 Tourism
Page 57 of 92
Expenditures
Salaries, Wages & Benefits
Materials & Supplies
Contracted Services
460 Museum
Expenditures
Materials & Supplies
Contracted Services
113,897
119,680
235,262
51.6%
33,303
17,743
66,500
49.9%
9,065
0
24,250
62.6%
4,598 9,705 18,700 75.4%
6,924 792 7,300 5.2%
473 Community Grant Program
Expenditures
External Transfers to Others 32,500 20,500 64,000 49.2%
480 Municipal Sponsorships
Expenditures
External Transfers to Others 74,420 0 35,000-112.6%
Total Community Services $ 8,275,632 $ 8,229,215 $ 13,914,614 40.5%
Highlights
Administration and Recreation Administration
Revenues across all sub -departments are extremely low, with the Provincial lockdown in place for most of the first and
second quarters of 2021. The pandemic has also impacted the expenses for Salaries, Wages & Benefits (PT), Materials &
Supplies and Contracted Services. There are noticeable decreases in expenses for each of these areas.
Page 58 of 92
Facilities
Facility rentals in all areas are tracking well below budget expectations for the first and second quarters of 2021. The
lockdown of all non -essential businesses saw the closure of municipal facilities. Although Rickard Recreation Complex
(RRC) remained open for mass vaccination and COVID-19 testing clinics, the multi -purpose revenue remained at $0 with
their use of the hall space. Staff anticipate this trend to continue to end of the year with the testing clinics remaining open.
With the loss of revenue due to the Provincial Lockdown, expense mitigation measures were implemented where possible
in all Part -Time wage accounts, utilities, operating supplies and waste disposal. There was significant reduction in Full -
Time overtime and internal redeployment of FT staff. These efforts sought to complete outstanding project work and to
reduce the costs of contracting for this work.
Although most revenues are down, Community Care Durham lease revenue is tracking on budget through the first and
second quarters. As we move into the third quarter, staff expect to see ice rental revenues increase as the Province
moves to reopen non -essential businesses and programs.
Aquatics
Below budget trends continue in aquatic lessons and public swim revenue. Significant expense mitigation measuress
were undertaken which effected part time wages for lifeguards and instructors as well as expenses for program supplies.
As the Province begins to reopen in the third quarter, public swims and swimming lessons revenue will increase from July
onward until the end of the year. Pool rental revenue expected to resume in September with the return of the Clarington
Swim Club.
Approximately $75,000 was received in 2021 from an insurance claim for the damage and lost revenues caused when a
vehicle entered the Courtice Community Complex pool in January 2019.
Page 59 of 92
Fitness
Gym membership and fitness class revenues are well below budget in the first and second quarters of 2021. Expense
mitigation steps were undertaken to result in lower year to date costs in PT Wages and Program Supplies accounts. Staff
are hopeful that this area's revenues will increase from the third quarter to the end of the year.
Recreation
Recreation program revenue and public skating revenues are, as all Community Services revenue, coming in well below
the year-to-date budget. Expense mitigation in PT Program Wages and Program Supplies accounts.
Community Development
The Virtual Mayor's Love of Art Gala revenue slightly exceeded budget expectations. Unfortunately, all in -person Canada
Day and Sport Hall of Fame events were cancelled in 2021
55+ Active Adults
Program and Aquafit revenue for 55+ Active Adults is well below the year-to-date budget. There was expense mitigation
set in place in PT Program Wages and Program Supplies accounts. Staff have no plans for special events in the near
future. As Provincial reopening continues, Program and Aquafit revenues will increase in the following quarters.
Customer Service
Merchandise sales were not possible with the facility closures resulting in no revenues to date.
Tourism
To date, significant savings have been realized in printing costs.
Page 60 of 92
Municipal Sponsorships
External Transfers to Others looks to be over budget however, there are unbudgeted sponsorships approved by Council
after the budget was approved. As some of the recipient organizations are consolidated as part of our financial
statements, it is critical for year-end reconciliation that these sponsorships remain easily identifiable.
Page 61 of 92
Planning and Development Services
000 Unassigned
Expenditures
Salaries, Wages & Benefits
$ 916
$ 2,108
$ 4,221
78.3%
Materials & Supplies
4,762
225,750
234,750
98.0%
Transfers from RES / RF / CAP Fund
640,375
640,375
640,375
0.0%
130 Admin
Revenue
User Charges
(619,121)
(451,904)
(1,114,991)
44.5%
Expenditures
Salaries, Wages & Benefits
1,524,070
1,849,190
3,632,851
58.0%
Materials & Supplies
45,339
63,198
109,550
58.6%
Contracted Services
29,422
900,805
946,000
96.9%
Transfers from RES / RF / CAP Fund
12,500
12,500
12,500
0.0%
250 Contributions
Revenue
Transfer between Funds
(1,000)
(1,000)
(1,000)
0.0%
321 Building Inspection
Revenue
User Charges
(1,308,299)
(897,150)
(1,769,500)
26.1 %
Fines/Penalties on Interest
0
(500)
(500)
100.0%
Expenditures
Salaries, Wages & Benefits
588,942
630,227
1,249,151
52.9%
Materials & Supplies
10,376
41,250
101,215
89.7%
Contracted Services
55,769
16,721
199,000
72.0%
Page 62 of 92
Total
YTD
YTD
Final
Unexpended
Actuals
BudgetDescription
•.-
%
Transfers from RES / RF / CAP Fund
227,950
227,950
227,950
0.0%
385 Environmental
Revenue
User Charges
(585)
0
0
Expenditures
Contracted Services
0
0
0
430 Smallboards
Expenditures
Materials & Supplies
(100)
0
1,500
106.7%
502 Development Review
Revenue
User Charges
(60,493)
0
0
Expenditures
Materials & Supplies
2,151
0
0
Contracted Services
84,559
0
0
Total Planning and Development Services
$ 1,237,533
$ 3,260,520
$ 4,474,072
72.3%
Highlights
Administration
Admin User Charges such as compliance letters and subdivision application fees are trending higher revenues at this time
of the year than expected. There is no specific reason for the increase as these are based on market trends. However,
Staff have noted that with the shift to this very active housing market, there have been more compliance letters to verify
Page 63 of 92
that there are no outstanding work orders (etc.) on purchased properties. There have been a few new subdivision
applications this year, but these are unpredictable and fluctuate by the developer or their schedule of submission.
Building Inspection
The Building Permit revenue is trending higher at this time of the year than expected. Although this revenue is also market
dictated, Staff are assuming that many people are building and renovating due to COVID-19 while staying home. This
increase in building permits for renovations have been seen in many GTA municipalities.
Environmental
Revenue received from the lease of Graham Creek Barrier is found in this sub -department.
Page 64 of 92
Looking forward to the 3rd Quarter
COVID-19 Mitigations and Changes to Restrictions
COVID-19 mitigation efforts continue through the third quarter of 2021. However, there is a movement towards reopening
and lessoning restrictions. There will be reflections of this in the expense and revenue accounts.
Continuous Improvement/Key Performance Indicators
As this report is constantly evolving and improving, we hope the third-quarter report will include upcoming continuous
improvements within the Municipality and focus on key performance financial indicators that will be used to benchmark
existing service levels.
Page 65 of 92
Clarftwn
Staff Report
If this information is required in an alternate accessible format, please contact the Accessibility
Coordinator at 905-623-3379 ext. 2131.
Report To: Audit and Accountability Committee
Date of Meeting: June 29, 2021 Report Number: FSD-036-21
Submitted By: Trevor Pinn, Director of Financial Services/Treasurer
Reviewed By: Andrew C. Allison, CAO Resolution#:
File Number: [If applicable, enter File Number] By-law Number:
Report Subject: Purchasing By-law Review 2021
Recommendations:
1. That Report FSD-036-21 be received;
2. That the updated By-law attached to this Report (Attachment 1) be passed; and
3. That all interested parties listed in Report FSD-036-21 and any delegations be
advised of Council's decision.
Page 66 of 92
Municipality of Clarington
Report FSD-036-21
Report Overview
To request authorization from Council to update the Purchasing By-law No. 2015-022.
1. Background
Page 2
1.1 At its meeting held on, March 9, 2015 General passed resolution #GPA-191-15
adopting the revised Purchasing By-law designed to meet departmental requirements
and operational needs while ensuring effective controls. As a requirement of the
Purchasing By-law, the Purchasing Manager is required to undertake a comprehensive
review of the Purchasing By-law every five years. The proposed updated By-law
(Attachment 1) repeals the existing By-law 2015-022.
1.2 The Purchasing By-law outlines the authority for the procurement of goods and
services, including the following:
• The authority and duties of the Purchasing Manager
• The process for bid solicitation and awarding of contracts
• The conditions under which goods and services can be sourced without a
competitive process
• Purchasing limits and delegation of authority
• Compliance
• Pricing/cost
2. Review Process
2.1 The Director of Financial Services/Treasurer and Staff from the Purchasing Services
Division established a working team to review and discuss revisions to the Purchasing
By-law to address operational improvements. Several meetings were held to review and
discuss the various sections of the Purchasing By-law. While some of the changes are
substantive, many of the changes are administrative.
2.2 The changes being proposed will allow Purchasing Staff to focus on higher dollar value
purchases, shorten the lead time for the procurement of goods and promote efficiencies.
A summary of proposed revisions to the new Purchasing By-law are shown below:
Page 67 of 92
Municipality of Clarington
Report FSD-036-21
By-law Provisions
1. Definition
• Include a definition for Single Source purchase
• Include a definition for Sole Source purchase
2. Bid Types and Limits
a) Informal Request for Quotation
Page 3
• Increase the authority to make acquisitions from between $5,000 - $25,000 to
between $5,000 - $50,000
b) Formal Request for Quotation
• Increase the authority to make acquisitions from between $25,000 - $100,000
to between $50,000 - $100,000
c) Bonds and Deposits
• Reword to delete any reference to cash and envelope and to include
accepting e-Bond.
d) Bid Procedure
• Delete any reference to hard copy submission and replace with "electronic
process"
e) Bid Opening
• Delete any reference to hard copy submission and public opening and
replaced with "Unless otherwise stated, all Bids shall be opened by the
Purchasing Manager and results posted publicly on the Municipality's
website".
f) Approval Limits and Reporting
• Change CAO's approval limit from $250,000 to $500,000
• Change the limit for award of contract for goods and services requiring
Committee's approval from $250,000 to $500,000
Page 68 of 92
Municipality of Clarington
Report FSD-036-21
Page 4
• Department Head may hire a consultant directly if the cost is below $25,000,
down from $30,000, in line with the treatment for other purchases
• CAO will approve hiring of consultants between $25,000 to $50,000
• Change the limit for award of contract for consulting and professional services
requiring Committee's approval from $30,000 to $50,000.
3. General Purchasing Policies
a) Fair Wage Policy
• Deleted
b) Lobbying
• Included a new section on lobbying as follows:
All prospective bidders are prohibited from lobbying any member of Council, staff
and consultants, appointed member and any staff of any Board during the period
commencing at the time of issuing a bid solicitation and ending at the time of the
award of the contract. The Municipality may reject any bid by a supplier that
engages in such lobbying, without further consideration, and may terminate that
supplier's right to continue in the bid solicitation process.
4. Schedule A
• Delete Engineering Services and Engineering Consulting Services from Schedule
from Schedule A.
5. Other Changes
• Other changes made are administrative in nature.
6. Future changes
• The Purchasing Services Division and the Energy and Climate Change Response
Co-Ordinator are working together on a green procurement policy. A separate report
will be sent to Council once the policy has been finalised.
Page 69 of 92
Municipality of Clarington
Report FSD-036-21
3. Concurrence
Page 5
Departments Heads have been consulted during the review process and the report has
been reviewed by the Director of Municipal Services/Municipal Solicitor who concurs
with the recommendation.
4. Conclusion
4.1 Overall, the general consensus is that the By-law facilitates efficient procurement
processes and effectively meets the operating requirements of the Municipality's
operating Departments while ensuring appropriate controls and accountability
measures.
4.2 It is respectfully recommended that the By-law attached to this report as attachment #1
be passed.
Staff Contact: David Ferguson, Purchasing Manager, 905-623-3379 Ext 2209 or
dferguson@clarington.net
Attachment:
Attachment 1 — Proposed updated Purchasing By-law.
Interested Parties:
There are no interested parties to be notified of Council's decision.
Page 70 of 92
Attachment 1 to FSD-036-21
Purchasing By -Law 2021-xxx
Table of Contents
Part1 — Interpretation................................................................................................... 3
Definitions.................................................................................................................... 3
WordUsage.................................................................................................................5
Severability.................................................................................................................. 6
References...................................................................................................................
6
Application................................................................................................................... 6
Part2 — Authority.......................................................................................................... 6
Purchasing Manager Authority..................................................................................... 6
ApprovalAuthority........................................................................................................ 6
SigningAuthority........................................................................................................... 7
Part 3 — Bid Types and Limits...................................................................................... 7
Purchasesup to $5,000.............................................................................................. 7
Informal Request for Quotation ($5,001 -$50,000)...................................................... 7
Formal Request for Quotation ($50,001 - $100,000)................................................... 7
Acquisitions over$100,000.......................................................................................... 7
RoutinePurchases....................................................................................................... 8
Negotiations / Single / Sole Source Purchases............................................................ 8
Requests for Proposal.................................................................................................
8
Product Demonstrations and Information..................................................................... 9
BidPre-Qualification....................................................................................................
9
Bondsand Deposits..................................................................................................... 9
Initial Bid Procedures.................................................................................................
10
Changes to Bids under Call.......................................................................................
11
Withdrawalof Bids.....................................................................................................
12
BidOpening...............................................................................................................
12
Verificationof Bids.....................................................................................................
12
Rejectionof Bids........................................................................................................
13
BidCancellation.........................................................................................................
14
AbsoluteRight............................................................................................................
14
LocalPreference........................................................................................................
14
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Purchasina By -Law No. 2021-xxx
Paae 2
Approval Limits and Reporting (Excluding Consulting and Professional Services) ....... 15
Council Recess Procedures....................................................................................... 15
Consulting and Professional Services (Excluding Schedule "A" Exemptions)............ 15
Co -Operative Purchasing........................................................................................... 16
Emergency Purchases............................................................................................... 16
Part 4 — General Purchasing Policies........................................................................16
Default By Successful Bidder..................................................................................... 16
Conflictof Interest...................................................................................................... 17
Access and Disclosure............................................................................................... 17
Records Retention and Destruction........................................................................... 17
Complaints and Inquiries........................................................................................... 18
Insurance................................................................................................................... 18
PurchasingCards...................................................................................................... 18
Disposalof Goods...................................................................................................... 18
OverExpenditures..................................................................................................... 19
Sustainability.............................................................................................................. 19
Accessibility for Ontarians with Disabilities Act, 2005................................................ 19
Part 5 — General Provisions........................................................................................19
By -Law Review.......................................................................................................... 19
Repeal....................................................................................................................... 19
EffectiveDate............................................................................................................. 19
Schedule"A"............................................................................................................... 21
Page 72 of 92
Purchasina By -Law No. 2021-xxx
Paae 3
If this by-law is required in an alternate accessible format, please contact the
Accessibility Coordinator at 905-623-3379 ext. 2131.
THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
BY-LAW NUMBER 2021-xxx
being a by-law to provide policies and procedures
for the procurement of goods and services.
WHEREAS pursuant to section 270 of the Municipal Act, 2001, the Corporation is
required to establish and maintain policies with respect to its procurement of goods and
services; and
WHEREAS the Corporation wishes to procure goods and services in the most efficient
and cost effective manner possible; and
WHEREAS the Corporation is committed to ensuring that its procurement policies and
procedures are fair, open and transparent.
NOW THEREFORE the Corporation of the Municipality of Clarington hereby enacts as
follows:
Part 1 — Interpretation
Definitions
In this by-law,
"Acquisition" means the purchase of a Good and/or Service for use on a permanent
or temporary basis;
"Bid" means a Proposal, Quotation or Tender;
"Bidder" is a Person who responds to a Bid Solicitation;
"Bid Solicitation" means a request by the Corporation for Bids for the provision of
Goods and/or Services through an RFP, RFQ or RFT;
"CAO" means the Chief Administrative Officer of the Corporation or a designate;
"Clerk" means the Municipal Clerk of the Corporation or a designate;
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Purchasina By -Law No. 2021-xxx Paae 4
"Committee" means the General Government Committee of Council;
"Consulting and Professional Services" means services provided by architects,
engineers, designers, environmental consultants, surveyors, management and
financial consultants, bankers, auditors, brokers, soil consultants, real estate
appraisers, Ontario land surveyors, web designers or any other consultant or
professional, but does not include any consulting and professional services referred
to in Schedule "A";
"Corporation" means The Corporation of the Municipality of Clarington;
"Cost" means the actual cost of an Acquisition excluding taxes;
"Contract" means an agreement between two or more Persons one of whom is the
Corporation;
"Council" means the Council of the Corporation;
"Department" means a Department of the Corporation identified on the annual
organization charts and reflected in the prevailing budget;
"Department Head" means the Director of one of the Departments or a designate;
"Disqualified Bidder" means a Bidder that has provided unsatisfactory Goods
and/or Services to the Corporation and consequently had a Contract terminated or
been notified by the Purchasing Manager that they are not eligible to submit a Bid;
"Expression of Interest" or "EOI" means general market research used prior to a
Bid Solicitation to determine if there is an interest in a proposed Acquisition;
"Goods and/or Services" means any goods and/or services required by the
Corporation other than goods and/or services listed in Schedule "A";
"Local Board" means a local board (as that term is defined in the Municipal Act,
2001) of the Corporation;
"Person" includes an individual, association, firm, partnership, corporation, union,
trust, organization, trustee or agent, and their heirs, executors, administrators,
successors and assigns;
"Proposal" means an offer from a Bidder made in response to an RFP;
"Purchase Order" means a Contract or a written acceptance of a Proposal, issued
on forms prescribed by the Purchasing Manager;
"Purchasing Manager" means the Purchasing Manager of the Corporation or a
designate;
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Purchasina By -Law No. 2021-xxx Paae 5
"Quotation" means an offer from a Bidder made in response to an RFQ;
"Request for Proposal" or "RFP" is a form of Bid Solicitation in which the
Corporation invites one or more potential suppliers to submit proposals with respect
to the supply of particular Goods and/or Services, which the Purchasing Manager in
consultation with the Department Head, determines may be dependent upon non -
price factors and may require negotiations between a Bidder and the Corporation
before a Contract is made between them;
"Request for Quotation" or "RFQ" is a form of Bid Solicitation in which the
Corporation requests either informal quotations or formal quotations;
"Request for Tender" or "RFT" is a form of Bid Solicitation in which the Corporation
publishes the specifications, terms, conditions and details concerning a proposed
Contract, and invites or advertises prospective Bidders to submit Tenders;
"Responsive and Responsible Bidder" is a Person responding to a Bid Solicitation
who complies with its provisions and who can reasonably be expected to provide
satisfactory performance of a proposed Contract based on reputation, references,
performance on previous contracts, and proof of sufficient financial and other
resources;
"Single Source Purchase" means a non-competitive purchase where there are
other suppliers of the product or service available, however, for reasons such as
emergency, proprietary, matching existing equipment, health and safety concerns,
time constraints, etc., the purchase is sourced to a specific vendor.
"Sole Source Purchase" means a non-competitive purchase where there is only
one supplier of the product or services and as a result a competitive quotation
process is not possible.
"Tender" means an offer received from a Bidder in response to an RFT;
"Treasurer" means the Director of Financial Services/Treasurer of the Corporation
or a designate; and
"Weighted Evaluation Criteria" means criteria that are taken into account when
evaluating Proposals including qualitative, technical and pricing considerations.
Word Usage
2. This by-law shall be read with all changes in gender or number as the context may
require.
3. A grammatical variation of a defined word or expression has a corresponding
meaning.
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Purchasina By -Law No. 2021-xxx Paae 6
Severability
4. Should any section or part of this by-law be held by a Court of competent
jurisdiction to be invalid, the remainder of this by-law shall not be affected.
References
5. In this by-law, reference to any Act, By-law or Policy is reference to that Act, By-
law or Policy as it is amended or re-enacted from time to time.
6. Schedule "A" (Exempt Good and/or Services) is attached to and forms part of this
by-law.
7. All references to dollar figures are Canadian dollars.
8. Unless otherwise specified, reference in this by-law to a clause, section or
Schedule is to a clause, section or Schedule in this by-law.
Application
9. This by-law shall not apply to the acquisition of any interests in real property. Such
matters shall be governed by By -Law 2011-011 and subsequent by-law.
10. This by-law shall not apply to the Acquisition of any Goods and/or Services listed in
Schedule "A".
Part 2 — Authority
Purchasing Manager Authority
11. The Purchasing Manager shall have the authority to act as agent of the
Corporation for the purpose of acquiring all Goods and/or Services required by
the Corporation.
12. The Purchasing Manager shall determine the method of Acquisition having
regard to the nature, importance or urgency associated with the purchase
requisition, subject to the general trade practice, market conditions and the
provisions of this by-law.
Approval Authority
13. No employee of the Corporation shall have the authority to make or approve an
Acquisition or award a Contract for any Good and/or Service unless funds for such
Acquisition have been allocated in a budget approved by Council. If a
recommended Bid is in excess of an approved budget limit but within the approval
limits of this by-law, the Treasurer, after consultation with the Department Head,
must approve the source of additional funding.
Page 76 of 92
Purchasing By -Law No. 2021-xxx Page 7
14. Contracts shall not be split so as to circumvent the established method of purchase
or the approval limits imposed by this by-law unless, in the opinion of the
Purchasing Manager, after consultation with the Department Head, if it is deemed
advantageous to acquire components of a major project through separate
Contracts.
Signing Authority
15. Authority to make or approve an Acquisition or award a Contract for any Good
and/or Service includes the power to sign all documents necessary to effect the
Acquisition. Where a Department Head or the CAO has the authority to sign a
Contract, the Purchasing Manager may sign on their behalf.
Part 3 — Bid Types and Limits
Purchases up to $5,000
16. Goods and/or Services not exceeding a Cost of $5,000, (excluding computers,
software, computer accessories and cell phones) do not require the submission of a
Purchase Order (unless one is required by the vendor) and may be purchased by
individual Departments as required at the lowest available Cost. However, if a term
order or another form of Contract is established, then the Department must
purchase from the Contract vendor. Computers, software, computer accessories
and cell phones must be ordered in coordination with the IT Division using a
Purchase Order.
Informal Request for Quotation ($5,001 - $50,000)
17. The Purchasing Manager shall have the authority to make Acquisitions for which
the Cost is between $5,001 up to a maximum of $50,000 at the lowest available
Cost, provided a minimum of three Quotations have been received where they are
reasonably required and possible to obtain.
Formal Request for Quotation ($50,001 - $100,000)
18. The Purchasing Manager shall have the authority to make Acquisitions for which
the Cost is between $50,001 up to a maximum of $100,000 at the lowest
available Cost, provided where they are reasonably required and possible to
obtain, at least three formal Quotations have been received and the lowest
Responsive and Responsible Bid received is acceptable.
Acquisitions over $100,000
19. Subject to sections 20, 21 and 23, Acquisitions that are anticipated to have a
Cost in excess of $100,000 shall be made through an RFT.
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Purchasina By -Law No. 2021-xxx
Routine Purchases
20. Where, in the opinion of the Purchasing Manager in consultation with the
Department Head, a proposed Acquisition is of a routine and repetitive nature, the
Purchasing Manager may obtain written Bids from suppliers and a Contract may
be awarded.
Negotiations / Single / Sole Source Purchases
21. In place of a Bid Solicitation, Goods and/or Services may be purchased through
negotiation, Single or Sole source purchases where, in the opinion of the
Purchasing Manager in consultation with the Department Head,
(a) the sources of supply are restricted to the extent that there is no effective
price competition;
(b) the purchase involves Goods and/or Services,
(i) that are in short supply due to market conditions;
(ii) for which there is no reasonable substitute or competitive product; or
(iii) for which compatibility with an existing product/services is the
overriding consideration;
(c) the purchase involves specialized preassembled goods;
(d) the Bid from the lowest Responsive and Responsible Bidder substantially
exceeds the estimated Cost;
(e) no Bid from a Responsive and Responsible Bidder is received and it is
impractical to issue another Bid Solicitation;
(f) the extension or reinstatement of an existing Contract would prove most
cost-effective or beneficial to the Corporation;
(g) the terms and conditions of a Proposal provide for negotiation with the
selected Bidder; or
(h) Council has specifically authorized an Acquisition through negotiation.
22. In the case of a Contract for a construction project, negotiations shall be conducted
in accordance with the Canadian Construction Documents Committee (C.C.D.C.)
Document 23 published by the Canadian Construction Association where expressly
required by the provisions of an RIFT.
Requests for Proposal
23. Irrespective of the anticipated Cost, where the Purchasing Manager in
consultation with the Department Head determines that a proposed Acquisition
involves unique or complicated circumstances, the Acquisition may be made
through the use of an RFP.
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Purchasing By -Law No. 2021-xxx Page 9
24. (1) In this section, "Two Envelope Method" means a procurement process in
which,
(a) a Bid is submitted in two separate envelopes, the first of which
contains technical and qualitative information and the second of
which contains price information; and
(b) Weighted Evaluation Criteria are applied and the second envelope is
opened only if the first envelope shows the Bidder to be qualified.
(2) The Purchasing Manager, in consultation with the Department Head, may
use an RFP process that utilizes a Two Envelope Method.
25. RFPs may be called by public advertisement or invitation to specific Bidders.
26. All RFPs shall be submitted in the prescribed manner and delivered to the
Purchasing Manager.
27. It is the Corporation's general policy to select the Proposal that best meets the
requirements of the RFP based on Weighted Evaluation Criteria.
Product Demonstrations and Information
28. No requests for prices or demonstrations for approved projects or programs above
$5,000 shall be made without prior consultation with the Purchasing Manager.
29. Requests on behalf of the Corporation may be made by Department Heads for
informal non -binding product and technical information, catalogues and price lists.
Each Department Head shall provide the Purchasing Manager with such data,
specification details and information relating to a proposed Acquisition, including the
Corporation's approved budget prices. The Purchasing Manager shall obtain all
binding or estimated prices provided by potential Bidders.
Bid Pre -Qualification
30. (1) In this section, "Pre -qualification" means a procedure whereby a prospective
Bidder satisfies the Corporation that it is capable of supplying a particular Good
and/or Service as a condition of being allowed to submit a Bid.
(2) If, in the opinion of the Purchasing Manager, Pre -qualification is required, the
Contract, if awarded at all, must be awarded to the lowest Responsive and
Responsible Bidder who has been pre -qualified.
Bonds and Deposits
31. All Bid deposits required as part of any Bid Solicitation shall be provided by certified
cheque, bank draft or money order made payable to "The Corporation of the
Municipality of Clarington". Bid bonds, including electronic bond, shall be issued by
a licensed surety company authorized to carry on business in Ontario, and shall be
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Purchasing By -Law No. 2021-xxx Page 10
in an amount and in a form satisfactory to the Corporation. Bid deposits shall be
submitted in accordance with the following schedule, unless otherwise specified in
the Bid Solicitation:
Total Amount of Bid
Up to $20,000.00
Up to $50,000.00
Up to $100,000.00
Up to $250,000.00
Up to $500,000.00
Up to $1,000,000.00
Up to $2,000,000.00
Over $2,000,000.0
Minimum Bid Deposit Required
$1,000.00
$2,000.00
$5,000.00
$10,000.00
$25,000.00
$50,000.00
$100,000.00
$200,000.00
32. When the deposit of a performance bond and/or labour and material payment bond
is a requirement of a Bid Solicitation, such bonds shall be,
(a) in the amounts specified in the Bid documents;
(b) issued by a licensed surety company authorized to carry on business in
Ontario;
(c) in a form approved by the Corporation; and
(d) delivered by the Bidder to the Purchasing Manager prior to execution of the
Contract.
33. Following the award of a Contract, all deposits that are in the form of certified
cheques or money orders, except for the deposits supplied by the successful and
next to successful Bidders in the case of a Contract award, shall be returned to the
unsuccessful Bidders. Retained Bid deposits shall be held until the Contract is
executed by the Corporation, unless otherwise determined by the Purchasing
Manager.
34. Following the cancellation of a Bid Solicitation, all deposits shall be returned to the
Bidders.
35. If a successful Bidder fails to enter into a Contract, the Bid deposit shall be forfeited
to the Corporation. If a Bid bond is deposited, it may be called by the Treasurer
and the amount of money thereby obtained shall be forfeited to the Corporation.
Initial Bid Procedures
36. If required, Bid Solicitations shall be advertised in the method deemed most
appropriate by the Purchasing Manager which may include, but shall not be limited
to periodicals, newspapers and/or websites.
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37. All closing times shall be established by the Purchasing Manager.
38. The Purchasing Manager shall make the bid document available to all prospective
Bidders through an electronic process.
39. Where a fee is required for Bid documents, prospective bidders shall be required
to pay for the bid document in the manner stipulated in the call document"
List of Registered Bidders
40. Contact information of all prospective Bidders who have obtained or who have
requested the material set out in Section 38 shall be recorded in order to facilitate
distribution of addenda when necessary to change or cancel a Bid under call.
Changes to Bids under Call
41. Interpretations of, or qualifications or changes to, a Bid Solicitation shall be made in
the form of a written addendum. Addenda shall be necessary to revise, delete,
substitute or add to a Bid under call. The Purchasing Manager shall approve the
issuance of any addendum or the cancellation of a Bid Solicitation.
42. A copy of each addendum or a notice of posting of each addendum shall be
forwarded to registered Bidders by electronic means and posted on the
Corporation's website.
43. Where an addendum is released after the receipt of one or more Bids which, in the
opinion of the Purchasing Manager, may affect a Bid, all Bids received prior to the
Bid closing may be withdrawn.
44. The Purchasing Manager in consultation with the Department Head may cancel a
Bid Solicitation either before or after Bids are opened. The procedure for the
notification to Bidders set out in section 42 shall apply to a notice of cancellation. If
a Bid is cancelled prior to opening, all Bids received after cancellation shall be
rejected.
Formal Bid Submissions
45. The Purchasing Manager shall,
(a) record time and date of all Bids received, in an appropriate manner;
(b) refuse to accept any Bid from a Disqualified Bidder;
(c) record all accepted Bids;
(d) maintain safe control of all accepted bids until needed;
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(e) refuse to accept any Bid that is not received in accordance with the terms and
conditions of the bid document, prior to the closing time established for that Bid.
Reasons for nonacceptance shall be communicated to the Bidder.
Withdrawal of Bids
46. A Bid can only be withdrawn prior to the close of Bids, as stipulated in the bid
documents. Requests to withdraw received following the close of Bids shall not
be accepted.
Bid Opening
47. Unless otherwise stated, all Bids shall be opened by the Purchasing Manager and
results posted publicly on the Municipality's website
48. All Bids shall be checked to determine that each Bidder has submitted one Bid only.
Should more than one Bid be submitted, and no withdrawal notice has been
received, the Bid with the latest time stamp shown shall be deemed to have
superseded the earlier Bid and the Bidder shall be bound by the contents of the
more recent Bid. If surety bonds are required to be submitted with the Bid at the
time of closing, and the Bidder has included the required surety bonds with the first
bid, the surety bonds may be deemed applicable to the Bid submitted with the
second bid received.
49. Any Bid that does not appear on initial examination by the Purchasing Manager to
satisfy the requirements of this by-law shall be deemed an "Improper Bid", but shall
nonetheless be subject to further examination to determine whether it should be
rejected pursuant to sections 51, 52 and 53.
Verification of Bids
50. Every Bid submitted shall be checked by the Purchasing Manager who shall ensure
that,
(a) it complies with the Bid Solicitation requirements;
(b) unit prices have been correctly extended;
(c) extensions have been correctly totalled; and
(d) applicable taxes have been calculated correctly.
51. Any extension errors, addition errors or incorrect tax calculations may be
corrected provided that the Purchasing Manager is satisfied that it is a bona fide
error, and not a price revision.
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Rejection of Bids
52. After Bid opening, the Purchasing Manager shall reject any Bid from a Bidder who
did not attend a mandatory pre -Bid meeting.
53. After Bid opening, the Purchasing Manager may accept or waive a minor and
inconsequential irregularity, or where reasonable to do so, the Purchasing
Manager may, as a condition of Bid acceptance, request a Bidder to correct a
minor and inconsequential irregularity with no change in Bid price. The
determination of what is, or is not, a minor and inconsequential irregularity, the
determination of whether to accept, waive, or require correction of an irregularity,
and the final determination of the validity of a Bid, shall be at the Purchasing
Manager's sole discretion. Without limiting the generality of the foregoing, the
Purchasing Manager may reject a Bid if it,
(a) is not submitted on the correct Bid form;
(b) is not submitted in the manner specified in the bid document or is illegible or
unclear;
(c) does not provide all entries for all unit prices referred to in the Bid Solicitation
(unless otherwise specified in the Bid Solicitation) or is otherwise incomplete
in any material respect;
(d) includes any restrictive or conditional statement that alters the form or intent
of the Bid;
(e) is not signed by the Bidder with an authorized signature;
(f) does not contain or acknowledge addenda;
(g) is not accompanied by bonding documents or bid deposits or contains an
improper or insufficient Bid deposit, where required;
(h) contains an error that cannot be corrected in accordance with section 51;
(i) is unbalanced, meaning it contains lump sum or unit bid items that do not
reflect reasonable actual costs plus a reasonable proportionate share of
the Bidder's anticipated profit, overhead costs, and other indirect costs;
Q) is from a Bidder or a subcontractor of a Bidder that has an outstanding legal
action against the Corporation, or the Corporation has an outstanding legal
action against the Bidder or a subcontractor of the Bidder including
arbitration or any association or union issues;
(k) is from a Bidder that owes money to the Corporation including outstanding
property taxes; or
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(1) is from a Bidder that is not in compliance with any of the Corporation's
policies or regulatory by-laws including, but not limited to the Property
Standards By-law.
54. Following the opening and recording of Bids, the record of Bids (including rejected
Bids) shall be closed in the manner approved by the Purchasing Manager.
Bid Cancellation
55. The Purchasing Manager, in consultation with the Municipal Solicitor and the
applicable Department Head, shall have the authority to cancel a Bid Solicitation
either before or after the call has closed if,
(a) a substantial change in the scope of work or specifications is required;
(b) the Goods and/or Services requested no longer meet the Department's
requirements;
(c) the integrity of the procurement process has been compromised; or
(d) the lowest Responsive and Responsible Bid exceeds the approved funding
limit.
Absolute Right
56. The Corporation shall have absolute discretion in the awarding of Contracts and
retains the right to reject any or all Bids.
Local Preference
57. (1) In this section,
(a) "Local Bid" means a Bid submitted by a Bidder who operates a
business within the Municipality of Clarington; and
(b) "Regional Bid" means a Bid submitted by a Bidder who operates a
business within the Regional Municipality of Durham.
(2) If, in the opinion of the Purchasing Manager, a competitive market exists and
two or more Bids are received which are identical in Cost, provided quality, service
and delivery terms are similar, then priority of acceptance shall be first to a Local
Bid, if any, and second to a Regional Bid, if any.
(3) Ontario's Discriminatory Business Practices Act, R.S.O. 1990, c.D.12 has
been established to prevent discrimination in Ontario on the grounds of race, creed,
colour, nationality, ancestry, place of origin, sex, or geographical location of persons
employed in or engaging in business. Accordingly, other than as noted in
subsection (2), preference to a Local Bid or a Regional Bid shall not be given.
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Approval Limits and Reporting (Excluding Consulting and Professional Services)
58. The Purchasing Manager shall submit to the Department Head an analysis listing
all Quotations and Proposals received with a recommendation for the Department
Head's approval if the Cost of the Goods and/or Services does not exceed
$100,000.
59. After consulting with the Department Head, the Purchasing Manager shall prepare
a report to the CAO for approval if the Cost of the Goods and/or Services does not
exceed $500,000.
60. The Purchasing Manager shall prepare a recommendation report to Committee if
the Cost of the Goods and/or Services exceeds $500,000.
Council Recess Procedures
61. (1) Notwithstanding section 60, where a matter which would have otherwise
been submitted to Committee requires approval during any of Council's recesses,
including elections, the CAO shall be authorized to award the Contract if the
Treasurer is of the opinion that the price is reasonably reflective of the approved
budget allocation and/or is part of the normal operating responsibility of the
Department.
(2) The Purchasing Manager shall report all Contracts awarded under
subsection (1) to Committee as soon as possible after the conclusion of the recess.
(3) Council shall not vary any action or decision of the Contract awards made in
accordance with this section.
Consulting and Professional Services (Excluding Schedule "A" Exemptions)
62. Where it is estimated that the Cost of Consulting and Professional Services will be
less than or equal to $25,000, the Department may obtain the services directly
without issuing a Bid Solicitation.
63. Where it is estimated that the Cost of Consulting and Professional Services will be
more than $25,000, the Purchasing Manager shall issue a Bid Solicitation in
compliance with this By -Law and prepare a report to the CAO for approval.
64. Where it is estimated that the Cost of Consulting and Professional Services will be
more than $50,000, the Purchasing Manager shall issue a bid solicitation, in
consultation with the Department Head and, shall submit a report to Committee
providing a recommendation for award.
65. An external consultant who has entered into a Contract for consulting services for a
particular phase of a project, may be deemed to have a conflict of interest and be
disqualified from submitting a Bid on a later phase of consulting services for the
same project. Any issue as to whether there is a conflict of interest shall be
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determined by the Purchasing Manager in consultation with the Department Head.
This section shall not apply where a consultant has been requested to provide a
budget estimate or general review and estimate for a potential Acquisition.
66. Any consultant authorized to issue a Bid Solicitation on behalf of the Corporation
shall comply with this by-law.
Co -Operative Purchasing
67. (1) In this section, "Co-operative Purchasing" means the participation of the
Corporation with one or more public agencies, school boards, vendors of record
(Provincial), hospitals or other public agencies in a Bid Solicitation.
(2) Co-operative Purchasing shall be utilized when advantageous and practical.
In the event of any conflict, the purchasing by-law and procurement practices of the
municipality, school board, hospital or other public agency issuing the co-operative
Bid shall take precedence over the provisions of this by-law.
Emergency Purchases
68. (1) In this section, "Emergency" means a situation or the threat of an impending
situation which, in the opinion of the CAO or a Department Head, requires an
immediate Acquisition to prevent serious delays, damage to a basic service, risk to
health and safety, financial loss or to maintain or restore a basic service provided by
the Corporation.
(2) Emergency Acquisitions shall be made by the Purchasing Manager. In the
absence of the Purchasing Manager, Emergency Acquisitions may be made by a
Department Head.
(3) All Emergency Acquisitions shall be confirmed through a Purchase Order
and shall be reported to Committee through a report prepared jointly by the
Department Head and the Purchasing Manager if the Cost exceeds $500,000 or an
approved budget limit.
Part 4 — General Purchasing Policies
Default By Successful Bidder
69. If a successful Bidder fails to execute the Contract or fails to meet any of the
requirements of the Contract within the prescribed time, the Contract may be
awarded to the next lowest Bidder or cancelled.
70. If a successful Bidder defaults on an awarded Contract, the Purchasing Manager is
authorized to take remedial action including termination of the Contract and all
necessary steps to ensure completion of the project or continued service/supply.
The Purchasing Manager, after consultation with the Department Head, may
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declare that any Bidder who has defaulted on a Contract is ineligible to submit a Bid
on any future Contract even if the awarded Contract is not terminated.
71. Should the Purchasing Manager determine that termination of the awarded
Contract is the appropriate action in accordance with section 70, whoever awarded
the Contract (Council, CAO or Department Head) shall be advised of the
termination in writing.
Conflict of Interest
72. The participation of members of Council and employees of the Corporation in the
procurement process shall be governed by, in the case of members of Council,
the Council Code of Conduct and the Municipal Conflict of Interest Act, R.S.O.
1990, c.M.50 as amended and, in the case of employees, by the Code of Ethics
Policy E-1.
73. No employee or Council member shall benefit directly or indirectly from affiliation
with the Municipality or show any favouritism to any Person in the procurement of
any Goods and/or Services.
74. No Person shall offer incentives to any employee of the Corporation or member
of Council.
75. (1) In this section, "Personal Purchase" means a purchase of Goods and/or
Services requested by an elected official, an appointed official or by any other
employee of the Corporation that is not required for the purposes of the Corporation
or a Local Board.
(2) No Personal Purchases shall be made by the Corporation for any Member
of Council, member of a Local Board, or employees of the Corporation.,
Access and Disclosure
76. No Corporation employee or any member of Council shall have access to or
disclose any details regarding Bids except as permitted by this by-law and the
Municipal Freedom of Information and Protection of Privacy Act, R.S.O. 1990,
c.M.56 as amended.
77. In the case of a Bid submitted in response to an RFP, only the total Bid amount for
the successful responsive and responsible Bid shall be provided and only upon
written request of any Person after completion of negotiations and award of the
Contract.
Records Retention and Destruction
78. Bid documents and related material shall be retained in accordance with the
Municipality's Records Retention Schedule, as amended.
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Complaints and Inquiries
79. All Bidder or potential Bidder complaints or inquiries, whether addressed to an
elected official, the CAO, a Department Head or any member of staff shall be
referred to Purchasing Services.
Lobbying
80. All prospective bidders are prohibited from lobbying any member of Council,
Municipal staff and consultants, appointed member and any staff of any Board
during the period commencing at the time of issuing a bid solicitation and ending
at the time of the award of the contract. The Municipality may reject any bid by a
Supplier that engages in such lobbying, without further consideration, and may
terminate that Supplier's right to continue in the bid solicitation process
Insurance
81. The Treasurer and the Municipal Solicitor shall review, as necessary, Contracts that
include provisions relating to liability and insurance.
Purchasing Cards
82. (1) In this section, "Purchasing Card" means a credit card issued by the
Purchasing Manager in accordance with the Purchasing Card Policy.
(2) Purchasing Cards may be used for all purchases as defined in the
Purchasing Card Policy where the Goods and/or Services do not fall under the
requirements of this by-law. Purchasing Cards are issued on an as needed basis
upon approval of the Purchasing Manager and at the request of the Department
Head. The Purchasing Manager shall be responsible for the program outlined in the
Corporation's Purchasing Card Policy.
Disposal of Goods
83. The disposal of surplus or obsolete goods of the Corporation shall be the
responsibility of the Purchasing Manager. At least once each calendar year,
Department Heads shall provide the Purchasing Manager with a list of such goods.
The Purchasing Manager may periodically circulate a list of surplus or obsolete
goods to all Departments and Local Boards.
84. The Purchasing Manager, in consultation with the appropriate Department Head,
shall determine the appropriate method of disposal including sale, RFT, RFP,
auction, or gratuitous transfer.
85. The priority of the disposal shall be in this order: another department within the
municipality, trade in on a replacement purchase, local board, other municipality,
school board, charity or not for profit organization, public at large.
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Over Expenditures
86. Subsequent to a Contract award, the approval of any over expenditure shall be in
accordance with the Corporation's Capital Project Over Expenditure Policy (G5) or
subsequently adopted policy for financial controls.
Sustainability
87. In order to contribute to waste reduction and to increase the development and
awareness of environmentally sound purchasing, Acquisitions shall ensure that,
wherever reasonably possible, specifications shall provide for expanded use of
durable products, reusable products and products (including those used in
services) that contain the maximum level of post -consumer waste and/or
recyclable content, without significantly affecting the intended use of the product
or service. It is recognized that analysis of Cost is required in order to ensure
that the products are made available at competitive prices.
Accessibility for Ontarians with Disabilities Act, 2005 (AODA)
88. When procuring Goods and/or Services, the Corporation shall incorporate
accessibility design criteria and features, except where it is not practicable to do
so. Where applicable, procurement documents shall specify the desired
accessibility criteria to be met and provide guidelines for the evaluation of the
proposals respecting those criteria.
Part 5 — General Provisions
By -Law Review
89. The Purchasing Manager in consultation with appropriate staff shall conduct a
detailed review of this by-law no less frequently than every five years.
Repeal
90. By -Law #2015-022 is hereby repealed.
Effective Date
91. This By-law shall take effect on the date that it is passed by Council.
By-law passed on the day of June 2021.
THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
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PER:
Adrian Foster, Mayor
PER:
June Gallagher, Municipal Clerk
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Schedule "A"
EXEMPT GOOD AND SERVICES
1. Petty Cash Items
2. Training and Education
a.
Conferences
b.
Courses
C.
Conventions
d.
Magazines
e.
Memberships
f.
Periodicals
g.
Seminars
h.
Staff Development
i.
Staff Workshops
j.
Staff Reports
k.
Subscriptions
I.
Trainers (includes workshop & seminars)
3. Refundable Employee Expenses
a. Advances
b. Meal Allowances
C. Miscellaneous — Non — Travel
d. Travel Expenses
e. Entertainment Expenses
4. Employer's General Expenses
a.
Payroll Deduction Remittances
b.
Medicals
C.
Licenses (Vehicles, Software, Communications, etc.)
d.
Debenture Payments
e.
Insurance
f.
Grants and Agencies
g.
Damage Claims
h.
Petty Cash Replenishment
i.
Land & Building Lease Payments made by Municipality
j.
Tax Remittances
k.
Sinking Fund Payments
I.
Newspaper Advertising and Public Notices
M.
Day Camp or other similar Admission Fees
n.
Software or equipment maintenance agreements
5. Certain Professional and other Services
a.
Committee Fees
b.
Counselling Services
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C. Laboratory Services
d. Nursing Services
e. Physician Fees
f. Temporary Help
g. Banking Services
h. Legal Services
i. Newspaper, radio, TV advertising
j. Policing
k. Red Cross Supplies
I. Web Design Usage Fee & penalties
M. Payroll fees
n. Employee Assistance programs
6. Utilities (including hedging agreements in accordance with the Hedging Policy as
may be amended from time to time)
a. Postage
b. Water
C. Hydro
d. Gas (including hedging agreements)
e. Telephones — excluding cellular
f. Telecommunications infrastructure
7. Canadian National and Canadian Pacific Railways
8. Provincial and/or Federal Government Agencies or Crown Corporations
9. Regional Municipality of Durham or other municipalities located within the Regional
Municipality of Durham Goods and/or Services
10. Election related technology and equipment, and any consulting and support
services directly related to such technology and equipment.
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