HomeMy WebLinkAbout2022-04-07Clarbgton
Audit and Accountability Committee
Agenda
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Date: April 7, 2022
Time: 9:30 am
Place: Held Virtually via Microsoft Teams
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1. Call to Order
2. Land Acknowledgement Statement
3. Declaration of Interest
There were no disclosures of interest stated at this meeting.
4. Presentations/Delegations
4.1. None
5. Reports/Correspondence Related to Presentations/Delegations
5.1 None
6. Communications
6.1 None
7. Staff Reports, Staff Memos, and New Business Consideration
7.1. Memo from Catherine Carr, Internal Audit Manager,
Regarding Investment Compliance as at December 31, 2021
7.2. Report IAS-001-22, Purchasing Card Internal Audit
7.3. Report FSD-017-22, Financial Services Quarterly Activity as of December 31, 2021
8. Unfinished Business
9. Questions to Staff/ Request for Staff Report(s) 1
Audit and Accountability Committee — April 7, 2022
10. Confidential Items
11. Adjournment
Clarftwn
MEMO
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Accessibility Coordinator at 905-623-3379 ext. 2131.
To: Audit and Accountability Committee
Mary -Anne Dempster, Chief Administrative Officer
Trevor Pinn, Director of Financial Services / Treasurer
From: Catherine Carr, Internal Audit Manager
Date: February 23, 2022
Re: Municipal Investment Compliance at December 31, 2021
This memo reports on the compliance of the Municipality's investments with the approved
Investment Policy as of December 31, 2021. The applicable Investment Policy was
approved by Council July 5, 2021. 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.
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, April 7,
2022). 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 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. Also, as
per the policy, the Municipality's investments in Elexicon Group are not included.
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
Investment Compliance December 31, 2021
Page 2
■
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 25 per cent for each
institution
• 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.
TABLE 1 INVESTMENTS BY INSTITUTION
TD Bank - Savings
ONE - HISA
ONE - Equity
ONE - Bond
BNS HISA
RBC
RBC - HISA
National Bank
BNS
BMO
HSBC
TD Bank
Prov BC
City of Toronto
Prov Alberta
Prov Quebec
Ontario Hydro
Regional Municipality of York
% of Minimum
Total Funds Total Ranae
$ 27,438,106
17.3%
5,081,669
3.2%
2,835,624
1.8%
4,389,086
2.8%
30,011,060
18.9%
8,191,674
5.2%
75,278
0.0%
8,805,845
5.5%
13,256,329
8.3%
25,865,779
16.3%
3,358,884
2.1 %
9,549,817
6.0%
3,773,141
2.4%
4,778,046
3.0%
6,118,857
3.8%
2,499,732
1.6%
2,499,594
1.6%
498,525
0.3%
$ 159,027,047
100.0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
Maximum
Ranae
100%
100%
15%
15%
100%
25%
100%
25%
25%
25%
25%
25%
20%
10%
20%
20%
5%
10%
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 JD Bank Savings, ONE HISA, BNS
HISA) are not to be included when determining the amount to be invested with an institution.
For this reason, three accounts are listed separately in the table above.
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
4
Investment Compliance December 31, 2021
Page 3
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
$ 71,830,823
45.2%
20%
100%
90 Days to 1 Year
3,837,128
2.4% 47.6%
30%
100%
1 to 5 Years
21,838,289
13.7%
0%
85%
5 to 10 Years
56,679,358
35.6%
0%
50%
10 to 20 Years
4,841,449
3.0%
0%
30%
$ 159,027,047
100.0%
The Municipality was compliant with the stated term length restrictions. The majority of
under 90 days investments are in bank accounts with TD Reserve account at 38.2 per cent
of this total and Scotiabank HISA at 41.8 percent. 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 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 58.8 per cent, development charge 20.6 per cent, and
strategic capital 20.6 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
• Financial institution investments are allowed to a maximum of 80 per cent in
aggregate and includes bonds, GICs and other eligible investments
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
5
Investment Compliance December 31, 2021
Page 4
• Corporate debt is allowed, subject to rating restrictions, to maximum of 10 per cent in
aggregate
• ONE Investment pools (not including ONE 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
$ 62,531,592
39.3%
0%
100%
Federal Debt
-
0.0%
0%
100%
Provincial Debt
11,007,539
6.9%
0%
80%
Municipal Debt
5,276,571
3.3%
0%
35%
Financial Institutions
70,487,041
44.3%
0%
80%
Corporate Debt (non -financial)
2,499,594
1.6%
0%
10%
ONE Investment Pools
7,224,710
4.5%
0%
25%
$ 159,027,047
100.0%
As of December 31, 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 December 31, 2021.
The one exception is the lack of documentation to link investments with maturities 10 to 20
years to a specific future cash flow. The investments in this segment are all TD Bank bonds
which mature January 26, 2032. As noted earlier, these types of bonds are very liquid and
can be sold upon request by the Municipality. It is likely there are several future projects in
2032 that could be linked to these longer -term investments. In 2022 these investments will
move to the 5 to 10 years investment term grouping and thereby eliminating the requirement
14 to be matched to a specific future cash flow. It is important that future investments with
maturity dates greater than 10 years be made with specific cash flows in mind and have
them clearly documented.
If you have any questions, please let me know.
CatTwrbnel Caw►
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
6
Clarftwn
Staff Report
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Coordinator at 905-623-3379 ext. 2131.
Report To: Audit and Accountability Committee
Date of Meeting: April 7, 2022 Report Number: IAS-001-22
Submitted By: Catherine Carr, Manager of Internal Audit
Reviewed By: Mary -Anne Dempster, CAO Resolution#:
File Number: By-law Number:
Report Subject: Purchasing Card Internal Audit
Recommendations:
1. That Report IAS-001-22 be received;
2. That the Director of Financial Services/Treasurer be directed to review and develop
a plan to implement the recommended controls.
Municipality of Clarington
Report IAS-001-22
Report Overview
Page 2
Purchasing cards are a useful tool for managing low -value purchases. With purchases
averaging over one million from 2017 to 2020, Internal Audit planned an audit of purchasing
card activity. This report covers the findings and recommendations from the internal audit
conducted on the 2020 purchasing card activities.
1. Background
History of Purchasing Cards
1.1 The Purchasing Card Program was first implemented in 1998 through TD bank. The
program proved to be effective at streamlining the purchasing processes, mainly for
those purchases under $5,000, by reducing administrative processes. In 2003, TD Bank
sold its purchasing card program. The Municipality then switched to US Bank
Mastercard Program (COD-035-03). In 2015, the Purchasing Card Program was
reviewed, and the Municipality switched to BMO Mastercard through the Ontario
Education Collaboration Marketplace (OECM) (COD-005-15). With the new agreement
with BMO Mastercard, the Municipality can earn revenue on total purchases. This is
paid annually. In 2021, the Municipality received income of $9,236.50 for purchases
from June 2020 to May 2021.
Purchasing By-law and Purchasing Cards
1.2 As per the purchasing by-law, purchases under $5,000 do not require a purchase order,
and Staff can make these low -value purchases using their purchasing card. Purchasing
By-law 2021-007, Part 3, Item 16, states:
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 IT Services, using a Purchase Order.
1.3 Generally, purchases over $5,000 are not processed on purchasing cards and as
stipulated in Schedule A of the Purchasing By-law, software and equipment
maintenance agreements are exempt. However, there could be a few exemptions for
emergency equipment. As the Municipality does not have a US bank account, it is more
efficient to process these US charges on a purchasing card. Currently, the Information
s
Municipality of Clarington
Report IAS-001-22
Page 3
and Technology Manager (IT Manager) is the only staff member in that division with a
purchasing card.
2. Purchasing Card Internal Audit
Methodology
2.1 In July 2021, the Internal Audit division began an in-depth audit of expenses made on
corporate -issued purchasing cards. This audit included time and resources dedicated to
research, planning, data compilation, analysis, and interviews. Internal audit staff were
delegated unfettered access to records and any relevant documents necessary to
conduct the audit as scoped.
2.2 The objective of this audit was to determine compliance of purchasing card usage with
the Municipality's procurement policies and Purchasing By-law, to review internal
controls of the purchasing card process and assess risk of fraudulent spending.
2.3 All departments and any staff member with a purchasing card under the current
agreement with the Municipality's Bank of Montreal (BMO) program were included as
part of this audit. The Clarington Library does not use the same system as the
Municipality. The Clarington Museums did use the BMO purchasing card with an MOU
with the Municipality. As of January 1, 2020, the Clarington Museums merged with the
Clarington Library. During 2020, the Clarington Museums stopped using the BMO
purchasing card through the Municipality's program.
2.4 The period chosen for this audit was the calendar year of 2020. The Municipality held
112 cards with the number of cards, limits and approval levels varying between
departments. Given the timeframe selected, the old organizational structure was in
place and was followed for this audit. The audit samples were taken from the entire
transaction list for the year, downloaded from the BMO client services site by the
Purchasing Manager. The raw data was then organized by date and then every 10tn
transaction was identified for further analysis as well as any transaction over $5,000.
Once those transactions were isolated, the backup for each transaction was reviewed.
The backup included the card statement from BMO, the spreadsheet analysis prepared
by the department and the receipts for the listed transactions. Each bundle of back up
documents was reviewed for a variety of criteria, some of which included; whether the
purchasing card was used for personal purchases, were Purchasing Card purchases
split to bypass purchasing card limits and/or policy on quotation/tender process, were P-
cards used to circumvent policy on quotation/tender process. From there any
issues/anomalies/deviations from the standard operating procedure were noted and
flagged.
Municipality of Clarington
Report IAS-001-22
Page 4
2.5 As part of the audit, policies reviewed were 135-Meal Allowance, E7-Conference and
Convention and El -Code of Ethics, G10-Purchasing Card Policy and the signed
agreement by the cardholder.
2.6 Further review was done to confirm processes for canceling purchasing cards (when
necessary), review the signed agreements for each of the cardholders identified in this
audit, review from departments on their procedures for processing monthly statements,
interviews, surveys, etc anonymous questionnaire were performed.
2.7 Some statistical data is shown in the attachments. This would include total amount of
purchasing card transactions, total number of cards issued, average transaction value.
Note that these statistics are grouped by the previous department structure.
Findings From Internal Audit
2.8 There was no indication of fraudulent purchases.
2.9 There were no incidents of invoice splitting found to circumvent the Purchasing By-law.
2.10 Several policies relate to employee expenses but the Municipality does not have a
comprehensive policy that clearly covers reasonable business expenses. There were
inconsistencies between departments with respect to some expenses. Some
departments bought gift cards for Staff and paid for meals and others did not. In many
cases, it was unclear who attended the meal or its purpose. This would be more
pertinent to meals within Clarington and Durham Region. It was probable that some of
the meals outside the area were related to conferences and training at outside locations;
however, individual meal purchases were not investigated.
2.11 There was a personal purchase made on a purchasing card. It was noted that this was
repaid once it was noticed by the staff member at time of statement review. The
employee and supervisor were questioned on this purchase and it appears to be an
unintended error. This has happened on occasion by several Staff as the purchasing
card can look very similar to a personal credit card. It is advisable for Staff to choose a
different PIN for the purchasing card as an additional measure to prevent the error using
the wrong card. There was no consistent personal use of the Purchasing card to
indicate abuse.
2.12 There was a long lag between the statement date and managerial approval and
submission to the Financial Services staff. As per the G10-Purhasing Card Policy, Staff
are to reconcile their account within ten days of the statement date (the 27t" day of each
month). It is important to note that the appropriate receipt must be included with the
statement reconciliation. For example, this must include a detailed restaurant receipt,
not the point -of -sale Mastercard receipt.
10
Municipality of Clarington
Report IAS-001-22
Page 5
2.13 There were purchases made with the purchasing card at businesses that the
Purchasing Division has negotiated a term order, such as Staples. There is a corporate
discount with Staples. Orders can be made online through the appropriate department
staff person, and orders generally arrive the next day via courier. This would also apply
to coffee supplies and phone cases for corporate phones.
2.14 There was a significant number of purchases made for fleet parts. With one particular
vendor there was over $85,000 in parts purchases with over four hundred transactions.
There should be an agreement negotiated with the vendor and the Municipality at this
volume and frequency. As well, it was not always clear from the descriptions if the parts
were for a specific vehicle or restocking of inventory.
2.15 There was an incident of a supervisor having a staff person purchase a phone case for
the supervisor, and then the supervisor approved the purchasing card expenditures.
There should be clear rules on approvals. The approver should not directly benefit from
the purchase. This would apply to meals as well. For example, a supervisor should not
have a staff person pay for a meal that includes the supervisor and then approve that
expense. This was not found in the meal receipts reviewed; however, it is one of the
reasons it is important to show details of meal expenses, such as who attended.
2.16 There was a purchase of software that exceeded the $5,000 threshold that the IT
division did not make. The IT Steering Committee structure in 2020 did not clearly show
any documentation of IT discussion or approval of the software. The IT manager was
not advised in advance of the software purchases.
2.17 Processing of monthly reconciliations varied from department to department. In some
cases, each cardholder was responsible for the reconciliation and in other, a clerical or
administrative staff person reconciled the accounts. This was a departmental decision
on how to process the monthly reconciliation. If the cardholder does not provide the
appropriate documentation to the clerk, then there is additional work for the clerk to
follow up with the cardholder. Ultimately, the cardholder is responsible for having the
appropriate receipts for their transactions.
2.18 From the Financial Services Department staff, it was noted that some statement
reconciliation remittances were often late and some did not include the required receipt
necessary for HST reporting. The purchaser, in this case the cardholder, is responsible
for ensuring they have the proper receipt complete with the HST number. An order form
or email confirmation of an order is not a proper receipt.
2.19 The Purchasing Manager sends out a transaction summary report to Department Heads
twice a year. This report shows all the transactions on purchasing cards issued to their
department. This can be used to look at trends and review purchasing card uses by
their Staff.
Is
Municipality of Clarington Page 6
Report IAS-001-22
3. Recommendations
3.1 That a comprehensive employee business expense policy be written to include
guidelines on all appropriate expenses. This would include the rules on meals, alcohol,
gift cards, phone accessories, mileage, and other expenses. It is important to note that
not all expenses are paid through the purchasing card program. Mileage expenses are
remitted through an employee expense form and paid through the payroll process, and
other expenses are paid through the Accounts Payable system. This will assist in
providing all staff clear direction on appropriate expenses. There should also be clear
rules outlined on meal expenses and required information on the expense (reason for
meal and who is in attendance).
3.2 It is recommended that a staff recognition policy be developed. The current policy D4
Employee Recognition Program pertains to the annual employee recognition function
which historically has included an organized dinner and awards. Rewarding Staff for
extra efforts throughout the year is important in maintaining morale and staff
engagement. It should be noted that under CRA rules, gift cards are considered a
taxable benefit. As well, the Municipality has a High Five program that Staff can
acknowledge the exceptional work and efforts of their coworkers. A policy with clear
guidelines would provide a consistent practice across all departments. It is
recommended that pre -approval be required before incurring the expense. For example,
as part of a team building exercise, supervisors could provide lunch.
3.3 Provide a memo to purchasing cardholders with reminders about rules on purchases.
This could include existing vendors with purchase agreements, rules on phone
accessories and other reminders. Additionally, it should be recommended that Staff use
a different PIN for their purchasing card rather than using the same PIN they use for
their personal cards.
3.4 Provide training to refresh Staff on monthly reconciliation process including timelines,
HST information and required receipts. Consider creating a form to be completed by
cardholder for a missing or improper receipt to be included in monthly reconciliation
process. If the process is reviewed and changed by Financial Services staff, ensure that
all Staff are aware of the changes to the process.
3.5 Public Works and Purchasing Division should investigate setting up a purchase
agreement on fleet parts. Following a competitive procurement process ensures the
highest value for the Municipality. If there is a specific supplier due matching equipment,
then a negotiated agreement should be made with clear terms and conditions.
3.6 A reminder that purchasing card limits, including transaction limits, should be reviewed
periodically by departments factoring in the Purchasing By-law and the staff
responsibilities. Changes to limits are documented through emails to the Purchasing
12
Municipality of Clarington
Report IAS-001-22
Page 7
Manager and require Department Head approval. If there is an exception to the $5,000
limit of a purchase without a purchase order such as specialized equipment, the
Purchasing Manager can make a temporary change to the limits with clear
documentation and Department Head approval.
3.7 There are changes being made to the IT Steering Committee which will improve IT
decision making (software and hardware). There should be Terms of Reference for the
IT Steering Committee.
3.8 Cyclical audits of purchasing card should be conducted on a regular basis. This will be
incorporated into future internal audit workplans.
4. Concurrence
Not Applicable.
5. Conclusion
The purchasing card program is a valuable tool for Staff as an efficient method of
procuring low -value goods and services. It is important to maintain controls to reduce
the risk of abuse and ensure that Municipal by-laws and policies are followed. While
there are strong controls in place, there is some room for improvement. It is respectfully
recommended that report IAS-001-22 be received and that Management be directed to
review and develop an implementation plan for the recommendations.
Staff Contact: Catherine Carr, Internal Audit Manager, 905-623-3379 ext 2606 or
ccarr@clarington.net
Attachments:
Attachment 1 — Purchasing Card Statistics
Interested Parties:
There are no interested parties to be notified of Council's decision.
13
Attachment 1 to IAS-001-22
TOTAL PURCHASING CARDS PER YEAR AND DEPARTMENT
- , . 1 11 - 1
1
6
7
6
CAC) Office
6
Clerks
7
5
5
6
Community Services
32
30
31
29
Corporate Services
8
8
7
7
Emergency & Fire Services
24
18
19
14
Engineering
11
12
10
11
Finance
2
3
4
3
Legal
2
2
2
2
Mayor's Office
4
4
4
2
Operations
24
27
26
25
Planning
4
3
5
5
Totals
124
118
120
110
TRANSACTION TOTAL PER YEAR AND DEPARTMENT
CAC) Office
$ 43,286
$ 78,508
$ 51,360
$ 49,362
Clerks
28,166
44,624
23,753
28,060
Community Services
154,995
207,461
181,257
89,765
Corporate Services
56,768
227,112
150,335
157,117
Emergency & Fire Services
216,235
80,917
88,672
56,153
Engineering
37,940
34,295
34,145
18,512
Finance
26,179
43,719
27,176
13,472
Legal
2,114
10,187
7,039
5,515
Mayors Office
22,318
19,449
25,162
11,928
Operations
443,282
467,476
467,198
390,817
Planning
18,097
22,196
21,792
13,990
Totals
$ 1,049,383
$ 1,235,943
$ 1,077,891
$ 834,692
14
AVERAGE TRANSACTION VALUE PER YEAR AND DEPARTMENT
1,200
1,000
800
600
Average Transaction Value ($)
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200
IIII 1�1 I I
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etao
■ 2017
■ 2018
■ 2019
■ 2020
15
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: April 7, 2022 Report Number: FSD-017-22
Submitted By: Trevor Pinn, Director of Financial Services
Reviewed By: Mary -Anne Dempster, CAO By-law Number:
File Number: Resolution#:
Report Subject: Financial Update as at December 31, 2021
Recommendation:
1. That Report FSD-017-22, and any related delegations or communication items, be
received for information.
16
Municipality of Clarington
Report FSD-017-22
Report Overview
Page 2
The COVID-19 pandemic has had a lasting impact on the Municipality of Clarington. It has
changed how 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 throughout 2021 as the lock -downs,
and public health restrictions impacted our ability to provide services and open facilities.
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
quarterly, starting with the second quarter each year. This report fulfills that 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 into sub -department with the expenses grouped 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 semi-annually, once in the fall, which
captures the "construction season" to September 30, and once in the late 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 most significant impact of COVID-19 continues to be felt by the Community
Services Department. While we had budgeted for reduced revenues in 2021 compared
to 2020, the various waves throughout 2021 and the roadmap to recovery, have
reduced the Municipality's ability to run programs and facilities as we had hoped in the
2021 budget.
2.3 The Municipality took steps to provide financial support to taxpayers through flexible
payment arrangements for taxes, deferral programs and financial support to businesses
17
Municipality of Clarington Page 3
Report FSD-017-22
(CIP). There does not appear to be significant impairment in our tax receivable, and we
have not received requests for assistance outside of the expected levels of request.
2.4 The Municipality has been diligent in applying for and has been successful in receiving
grants offered by various organizations for both capital and operating funds. Staff
continue to seek out and apply for grant opportunities to benefit our community and its
residents.
2.5 The investment market continued to be low throughout 2021 in fixed incomes resulting
from the Bank of Canada's decision to keep the bank rate at 0.25%. Starting in 2022,
we have seen increased fixed -income rates as the bank rate has increased and the
economy continues the recovery stage.
3. Concurrence
Not Applicable.
4. Conclusion
It is respectfully recommended that the report be received for information
Staff Contact: Alexandra Baker, Financial Analyst, 905-623-3379 ext.2623 or
abaker@clarington.net.
Attachments:
Attachment 1 — Financial Update for the Period Ending December 31, 2022
Interested Parties:
There are no interested parties to be notified of Council's decision.
18
Financial Update as at December 31,2021
Fl
IL •
1
f
Financial Update for the period ending December 31,
2021 (unaudited)
This report provides an update on the Municipality of Clarington's financial activity through the fourth 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. For 2021, year-to-year comparisons are not as relevant as there have
been major department reorganizations and impactful COVID-19 effects. This report will continue to provide a financial
overview of budget variances as of December 31, 2021, focusing on the variances to the 2021 budget. Essential non-
financial functions of the Municipality, such as service level achievements or deficits that have been realized within the
reported quarter, a review of COVID-19 impacts and department initiatives will also be identified.
COVID-19 Implications
The Municipality continues to experience financial impacts from COVID-19. Monitoring access to facilities by requesting
proof of vaccination from our patrons continued through the fourth quarter of 2021. The impact on our revenues and
expenses are highlighted below for each department.
Taxes Receivable/Collected
Taxes Receivable as of December 31, 2021, provides the status of the taxes billed and collected by the Municipality
during the fourth quarter. A total of $8,935,200 remains unpaid which is on trend for this same quarter in previous years.
This unpaid value is 4.46% of the taxes levied in 2021. In December 2020, there were taxes receivable of $9,288,100
which was 4.77% of taxes levied in 2020. The difference from 2020 to 2021 is a favorable reduction of $352,900, or
20
3.95% less than the previous year and the ratio is 0.31 % lower. The following table outlines the taxes receivable ratio for
2021 and the three previous years:
Taxes Receivable
$ 8,665,200
74.81
$ 9,383,300
$ 9,288,100
$ 8,935,200
Taxes Levied
179,993,900
187,277,800
194,744,300
200,299,200
Taxes Receivable Ratio
%
5.01 %
4.77%
4.46%
Grants
In March 2021, the 2021 Provincial COVID-19 Recovery Funding for Municipalities program, was made available to Ontario
municipalities. The intention of the funds is to help municipalities address their 2021 COVID-19 related operating impacts.
Clarington received our first installment in the second quarter of 2021 and the second installment in the fourth quarter.
The final payment of the Audit and Accountability Fund Intake 2 were received from The Ministry of Municipal Affairs in
the fourth quarter.
Funds were received under the Canadian Parks and Recreation Association (CPRA) in the fourth quarter. CPRA are
providing funding through the Youth Employment and Skills Strategy (YESS) Program to support job placements for
youths. This program funding allows flexibility to the municipality to offer youth placements with a focus on providing
development in a broad range of skills, knowledge and experience in parks and recreation. Funding will be announced
each year with the program ending December 2023.
The installment of the Summer Jobs grant was received in the fourth quarter and is used to subsidize student wages. The
funds are received from the Government of Canada, Employment and Social Development branch. This year's grant is
21
higher than 2020's grant by approximately 40% (which had been affected by COVID-19). The 2021 value is in line with the
grant's received in years prior to COVID-19.
Funds received from OPG will be used to complete the Community Mural. Clarington's mural will be an apple tree with
each square of the mural a tile that a different resident will paint. An unveiling ceremony will take place in winter 2022.
Development Charges Collected
Residential and non-residential development charges collected as of December 31, 2021, was $10,458,700
Residential municipal development charges collected were $10,031,900 compared to $13,526,200 in 2020 for the same
time period. The 2020 Development Charges Background Study forecasted that the Municipality would be collecting
approximately 1,135 units in total for 2021. Development charges have been collected for 585 units as of December 31, 2021.
The development charges collected are lower than those collected in 2020. The Development Charge Study is only an
estimated forecast of units. Over the years the estimated units are not always met. The COVID-19 pandemic has had a
significant impact on building permits. The pandemic has impacted the building industry significantly with cost and supply
of building materials as well as labour shortages. This has affected the number of building permits applications. Staff
advise that there are currently 500 residential units, mostly high-rise buildings, applied for and under review.
22
RESIDENTIAL
Municipal
Number of
Municipal
Number of
Development
Units
Development
Units
Charges Paid
Charges Paid
Single/Semi- Detached
-New construction
$ 5,438,800
258
$ 6,840,900
378
-Additions
0
0
0
0
Townhouse
4,435,300
287
5,686,900
409
Apartment
157,800
40
998,400
115
TOTAL:
$ 10,031,900
585
$ 13,526,200
902
Change in DC paid from prior year: -25.8%
Change in DC units from prior year: -35.1 %
Municipal Development
Municipal Development
NON-RESIDENTIAL
Charges Paid
Charges Paid
Commercial
-New construction
$ 426,800
$ 423,100
-Additions
0
0
Industrial
-New construction
0
577,300
-Additions
0
0
Agricultural
0
0
Government
0
0
Institutional
0
0
TOTAL:
$ 426,800
$ 1,000,400
Change in DC paid from prior year: -57.3%
23
Municipal Development Charge Incentives
A new Development Charges Study was released in 2020 and approved in 2021, and few new incentives were identified
to encourage development in Clarington. While the 2015 DC Study outlined incentives mainly for multi -residential,
commercial and industrial development, the 2020 Study was expanded to include new detached dwellings, semi-detached
dwellings, ancillary structures to a new detached/semi dwelling and Affordable Housing as outlined in the Ontario
Community Housing Renewal Strategy. There are no incentives provided to developers in 2021, as of December 31,
2021.
Note that discretionary incentives are required to be covered by the Municipality's tax base. All incentives under the 2015
DC Study have since been funded and the required transfers made.
Propertype
Mid -Rise Residential
2015-2020
$ 413,800
2021
Total
$ 413,800.00
Percentage
of Total
Revitalization, Mixed Use
157,800
157,800
New Detached Dwellings
Semi -Detached Dwellings
Ancillary Structures for New Detached/Semi Dwelling
Affordable Housing
Residential
$ 571,600.00
$ -
$ 571,600.00
37%
Medical Exemption
110,700
110,700
Revitalization, Small Business
5,500
5,500
Existing Industrial Development
23,000
23,000
Conversion Residential to Commercial
16,000
16,000
New Industrial Development
755,500
755,500
Revitalization, Mixed Use
72,900
72,900
Non -Residential
Totals
$ 983,600.00
$ 1,555,200.00
$ -
$ -
$ 983,600.00
$1,555,200.00
63%
100%
24
Staffing Updates
For the period ending December 31, 2021, there were 695 staff (including those on a leave — not COVID related). Prior to
COVID-19, there were 809 employees which includes Mayor and Council (7), temporary staff, volunteer firefighters and
employees on leave (this does not include Library or Museum). There were two retirements during the fourth quarter.
25
Municipal Operating Revenues and Expenses
Overview - Financial Results
This financial update report is designed to focus on the (unaudited) overall budget variances for the period ending
December 31, 2021. The department summaries indicate the status of the Municipality's operating accounts compared to
the approved budget as of December 31, 2021.
Seasonal trends impact many of the operations of the Municipality 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 on a monthly basis based on the prior year's actual monthly distribution. In cases with no previous
history, the monthly allocation is divided equally over the twelve months.
Due to timing differences, variations from quarter -to -quarter as well as year-to-year exist and 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. In order to assist with the management of the budget, the Financial
Services Department sends monthly trial balances to each department for regular review.
The Summary of Operating Revenues and Expenditures compares the Municipality's budget to actual transactions as of
December 31, 2021, reflecting financial activity through the fourth quarter 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.
26
Unassigned
($38,202)
$ 0
-%
Non -Departmental Accounts
(77,678,424)
(79,044,602)
1.7%
Mayor and Council
691,057
810,336
14.7%
Office of the CAO
1,653,096
1,755,525
5.8%
Legislative Services
4,120,343
4,985,589
17.4%
Financial Services
10,528,132
7,325,502
-43.7%
Emergency and Fire Services
12,809,146
13,524,026
5.3%
Public Works
23,744,603
27,448,416
13.5%
Community Services
12,542,281
13,914,614
9.9%
Planning and Development Services
1,215,118
4,474,072
72.8%
Levies
(2)
0
-
BIAs
0
0
-
Libraries/Museums
3,914,674
3,671,599
-6.6%
Culture
221,149
219,366
-0.8%
External Agencies
803,557
915,557
12.2%
Total Municipality of Clarington
($5,473,472)
$ 0
0
27
Revenue and Expense Categories
Revenues and expenses are categorized based on their
purpose and similarities.
Revenues
Levies
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.
Provincial Grants and Subsidies
Grants received from the Province of Ontario for specific
functions such as the Ontario Community Infrastructure
Fund or specific grant projects.
Federal 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.
28
Other Revenues
Any revenue that is not otherwise categorized.
Expenses
Salaries and Benefits
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
29
Mayor and Council
100 Mayor
Expenditures
Salaries, Wages & Benefits
$ 239,536
$ 249,108
3.8%
Materials & Supplies
16,577
59,341
72.1 %
105 Council
Expenditures
Salaries, Wages & Benefits
409,963
430,517
4.8%
Materials & Supplies
1,426
9,070
84.3%
106 Ward Council
Expenditures
Materials & Supplies
14,734
38,300
61.5%
107 Regional Council
Expenditures
Materials & Supplies
8,821
24,000
63.2%
Total Mayor and Council
$ 691,057
$ 810,336
14.7%
Highlights
Although there were no items of interest to highlight for the period ending December 31, 2021, it is important to note that
these departments are 15% under budget ($119,000). This is attributed to limited travel and conferences with COVID-19
restrictions. There has also been a reduction in spending through most Material and Supplies accounts as there was
limited staff in the office.
30
Administration
000 Unassigned
Expenditures
Materials & Supplies
$ 374,731
$ 377,418
0.7%
130 Admin
Expenditures
Salaries, Wages & Benefits
487,841
562,256
13.2%
Materials & Supplies
62,402
56,425
-10.6%
Contracted Services
84,368
30,000
-181.2%
170 Communication
Revenue
User Charges
0
(15,000)
100%
Expenditures
Salaries, Wages & Benefits
538,477
584,601
7.9%
Materials & Supplies
75,545
104,400
27.6%
Contracted Services
30,268
55,425
45.4%
385 Environmental
Revenue
User Charges
(136,340)
(83,500)
-63.3%
Expenditures
Materials & Supplies
5,273
3,500
-50.7%
Contracted Services
130,531
80,000
-63.2%
Total Administrator's Office
$ 1,653,096
$ 1,755,525
5.8%
31
Highlights
Administration
Contracted Services is over budget due to the Service Delivery Review. These costs are offset with funding from the Audit
and Accountability Fund Intake 2.
The Materials and Supplies overage will be corrected with a yearend entry to correct an accounting error in the
Miscellaneous Expense Account.
Environmental
The overages in Materials and Supplies and Contracted Services relate to Port Granby which are offset by the revenues
in User Fees. Although, most of these expenses are recoverable, advertising expenses are not per the agreement with
Canadian Nuclear Laboratories (CNL).
32
Legislative Services
130 Admin
Revenue
User Charges
$ (119,046)
$ (122,800)
3.1 %
Expenditures
Salaries, Wages & Benefits
881,309
1,008,646
12.6%
Materials & Supplies
64,268
86,010
25.3%
Contracted Services
12,744
10,800
-18.0%
Transfers from RES / RF / CAP Fund
73,500
73,500
0%
160 HR/Payroll
Expenditures
Salaries, Wages & Benefits
1,569,128
1,437,829
-9.1 %
Materials & Supplies
6,976
12,600
44.6%
Contracted Services
72,334
82,000
11.8%
Rents/Financial Expenses
89,908
140,000
35.8%
165 Health & Safety
Expenditures
Materials & Supplies
23,044
23,075
0.1 %
Contracted Services
0
12,000
100%
Transfers from RES / RF / CAP Fund
2,500
2,500
0%
190 Animal Services
Revenue
User Charges
(88,212)
(87,800)
-0.5%
33
Donations and Contributions from Others
(9,731)
0
-
Expenditures
Salaries, Wages & Benefits
395,096
447,579
11.7%
Materials & Supplies
57,167
67,925
15.8%
Contracted Services
76,647
59,000
-29.9%
Transfers from RES / RF / CAP Fund
10,000
10,000
0%
191 Municipal Law Enforcement
Revenue
User Charges
(16,756)
(28,000)
40.2%
Fines/Penalties on Interest
(15,785)
(25,000)
36.9%
Expenditures
Salaries, Wages & Benefits
860,204
885,842
2.9%
Materials & Supplies
13,837
21,000
34.1 %
Contracted Services
29,286
54,100
45.9%
192 Parking Enforcement
Revenue
User Charges
(101,899)
(80,000)
-27.4%
Fines/Penalties on Interest
(251,885)
(250,000)
-0.8%
Expenditures
Salaries, Wages & Benefits
378,098
416,963
9.3%
Materials & Supplies
14,379
24,840
42.1 %
Contracted Services
9,617
10,000
3.8%
Rents/Financial Expenses
9,832
10,000
1.7%
Transfers from RES / RF / CAP Fund
353,829
330,000
-7.2%
34
193 Election
Expenditures
Contracted Services
Transfers from RES / RF / CAP Fund
194 Legislative Services
Revenue
User Charges
Expenditures
Salaries, Wages & Benefits
Materials & Supplies
Contracted Services
230 Grants
Revenue
Grants
250 Contributions
Revenue
Transfer between Funds
326 Cemetery
Revenue
User Charges
Expenditures
Materials & Supplies
388 Fleet
Expenditures
3,943 4,000 1.4%
125,000 125,000 0%
(84,136) I (58,000) I -45.1%
380,012 365,730 -3.9%
30,243 37,800 20.0%
0 75,000 100.0%
(28,289) I (22,000) I -28.6%
(472,934) I (461,803) I -2.4%
(260,474) I (208,100) I -25.2%
0 I 1,800 I 100%
35
Highlights
Council Services (Administration)
Revenues for Marriage Licences were higher than budgeted at the end of the fourth quarter. Staff note that although
revenues are higher than anticipated they are somewhat in line with previous years (excluding 2020 which was
significantly impacted by COVID-19 restrictions).
HR/Payroll
The overage in Salaries, Wages & Benefits is attributed to residual effects of the organizational restructuring, overtime,
and vacation payout.
Animal Services
There has been an increase in online animal license purchases possibly from the need to make purchases remotely
through COVID-19 restrictions and the increase in pet ownership.
Contracted Services is over budget with increased fees from veterinarian and janitorial services due to COVID-19. The
commission expenses increases are linked to the increase in animal license purchases.
36
Parking Enforcement
Parking meter revenue has come back up to the levels that were seen pre-COVID-19. Note that for the user fees, fines
and penalties collected there is a corresponding transfer to reserve funds.
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.
Cemetery
Bondhead Cemetery revenue continues to exceed budget expectations. Staff are unable to pinpoint the cause other than
to note that the population is growing in that area and residents tend to purchase plots for pre -need where they live. The
burials and internments have increased overall as well.
37
Financial Services and Unclassified Administration
000 Unassigned
Revenue
Fines/Penalties on Interest
130 Admin
Revenue
User Charges
Fines/Penalties on Interest
140 Internal Audit
Expenditures
Salaries, Wages & Benefits
Materials & Supplies
162 IT
Expenditures
Salaries, Wages & Benefits
Materials & Supplies
Contracted Services
Transfers from RES / RF / CAP Fund
Reclass: CF (NON-TCA) to GF
210 Finance Admin
Expenditures
Salaries, Wages & Benefits
Materials & Supplies
Contracted Services
211 Unclassified Admin
Revenue
$ 4,084 $
(225,313)
(1,582,533)
153,325
0
1,387,297
8,909
5,892
300,600
680,273
2,892,501
96,003
86,184
(15,000) 127.2%
(200,000)
-12.7%
(1,400,000)
-13.0%
154,743
0.9%
300
100.0%
1,497,831
7.4%
8,200
-8.6%
15,000
60.7%
300,600
0%
600,000
-13.4%
3,082,732
6.2%
101,190
5.1%
54,000
-59.6%
38
User Charges
(168,565)
0
-
Expenditures
Materials & Supplies
394,372
705,306
44.1 %
Contracted Services
1,198,888
1,285,600
6.7%
Rents/Financial Expenses
309,386
205,000
-50.9%
Transfers from RES / RF / CAP Fund
5,319,645
930,000
-472.0%
250 Contributions
Revenue
Transfer between Funds
(332,816)
(332,816)
0.0%
Total Financial Services
$ 10,528,132
$ 6,992,686
-50.6%
Highlights
Unassigned
The Fines/Penalties on Interest section of the Unassigned sub -department is sitting with a debit balance at the end 2021.
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 Services
The Materials and Supplies category is over budget at the end of the fourth quarter due to several re -cabling requirements
for both the Fire Hall and Town Hall. There were also a few batteries that needed to be replaced in UPS units and the
touch screen for the Tax Division was also replaced.
39
Software and Hardware Contract accounts are over budget this year due to additional cloud backup requirements,
security suite renewal, additional license requirements for Microsoft and replacement of our anti -virus software. These
purchases will provide for more robust disaster recovery options and address increased cyber security concerns
Finance Admin
The overages in Contracted Services are attributed to a few assessment appeals, dating back to the 2017 taxation year,
that were settled in 2021. These appeals are monitored by Michael Steinberg due to the potential revenue loss associated
with large Commercial, Industrial and/or Multi -Residential properties. Report FND-007-20 indicated that no new collection
action be taken between April 1, 2020, and November 1, 2020, creating a backlog of properties eligible for tax sale. For
properties registered at the end of 2020, majority of the legal fees were charged in 2021 due to legislative timelines.
These tax sale related fees are 100% recoverable.
Unclassified Admin
Due to an unsuccessful tax sale in March 2021, Report FSD-029-21 recommended a Notice of Vesting be registered in
Clarington's name. This property contained outstanding taxes dating back to 2011, as well as Property Standards costs
The 2020 Surplus is included in the Transfers from Reserve and Reserve Funds. This is larger than in previous years as
the expenses for the Municipality were below the 2020 budget. Recognized savings through the year contributed to the
surplus, even though the Municipality did not recognize the revenue levels that were budgeted. The funding received from
the Province of Ontario and the Government of Canada's Safe Restart Program, were recognized as revenue in 2020 and
are included in the 2020 surplus.
40
Emergency Services
130 Admin
Revenue
User Charges
$ (360,150)
$ (115,000)
-213.2%
Expenditures
Salaries, Wages & Benefits
913,943
958,880
4.7%
Materials & Supplies
169,109
234,050
27.7%
External Transfers to Others
7,750
10,000
22.5%
Transfers from RES / RF / CAP Fund
737,805
637,500
-15.7%
280 Fire Prevention
Revenue
User Charges
(13,863)
(44,500)
68.8%
Expenditures
Salaries, Wages & Benefits
740,056
796,825
7.1 %
Materials & Supplies
23,059
45,000
48.8%
Contracted Services
7,632
1,000
-663.2%
281 Fire Suppression
Expenditures
Salaries, Wages & Benefits
8,392,867
8,634,223
2.8%
Materials & Supplies
64,294
90,000
28.6%
Contracted Services
58,388
80,000
27.0%
282 Fire Training/Technical Support
Expenditures
Salaries, Wages & Benefits
328,590
364,141
9.8%
Materials & Supplies
6,127
6,500
5.7%
283 Fire Communication
Expenditures
41
Contracted Services
633,023
623,000
-1.6%
284 Fire Mechanical
Expenditures
Materials & Supplies
65,749
115,000
42.8%
285 All Stations - P/T Admin
Expenditures
Salaries, Wages & Benefits
825,996
865,215
4.5%
Materials & Supplies
34,873
46,700
25.3%
Contracted Services
12,764
6,500
-96.4%
286 Municipal Emergency Measures
Revenue
User Charges
0
(10,000)
100%
Expenditures
Materials & Supplies
25,109
26,950
6.8%
Contracted Services
0
5,000
100%
287 Mechanical Technical Support
Expenditures
Salaries, Wages & Benefits
136,025
147,042
7.5%
Total Emergency and Fire Services
$ 12,809,146
$ 13,524,026
5.3%
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.
42
Transfers to the Reserve and Reserve Fund category includes the transfers of the Emergency Call revenue to the
Reserve Fund. In previous years, this revenue was an unbudgeted item.
Fire Prevention
An increase in requests for file reviews, property searches, incident reports and burn permit applications has resulted in
higher revenues than were seen last year.
Contracted Services is awaiting yearend entries to reallocate the overages.
Fire Communications
The Radio Equipment Rental account looks to be over budget, however there will be an offsetting rebate received from
the Region of Durham.
All Stations - P/T Admin
Cleaning supplies and janitorial services are over budget this year due to COVID-19 cleaning requirements.
43
Public Works
000 Unassigned
Revenue
User Charges
$ (109,135)
$ (209,300)
47.9%
Expenditures
Salaries, Wages & Benefits
3,514
3,000
-17.1 %
Materials & Supplies
75,688
90,834
16.7%
Contracted Services
8,360
1,000
-736.0%
130 Admin
Revenue
User Charges
(524,260)
(310,800)
-68.7%
Expenditures
Salaries, Wages & Benefits
4,832,665
5,286,990
8.6%
Materials & Supplies
99,111
109,050
9.1%
Contracted Services
36,488
226,000
83.9%
Debt Services (Principle and Interest paid)
546,623
546,623
0%
Transfers from RES / RF / CAP Fund
6,052,612
5,723,536
-5.7%
250 Contributions
Revenue
Donations and Contributions from Others
(5,230)
0
-
Transfer between Funds
(1,047,300)
0
-
324 Street Lighting
Revenue
44
User Charges
(4,867)
(15,000)
67.6%
Expenditures
Materials & Supplies
591,704
700,000
15.5%
Contracted Services
193,956
280,000
30.7%
Debt Services (Principle and Interest paid)
219,670
219,670
0%
Transfers from RES / RF / CAP Fund
100,000
100,000
0%
325 Parks
Expenditures
Salaries, Wages & Benefits
1,346,933
1,193,058
-12.9%
Materials & Supplies
686,614
569,600
-20.5%
Contracted Services
1,088,724
1,489,760
26.9%
Rents/Financial Expenses
122,794
48,000
-155.8%
Transfers from RES / RF / CAP Fund
1,151,144
1,157,900
0.6%
326 Cemetery
Revenue
User Charges
(159,600)
(143,000)
-11.6%
Expenditures
Salaries, Wages & Benefits
228,016
339,392
32.8%
Materials & Supplies
164,885
98,700
-67%
Transfers from RES / RF / CAP Fund
55,000
55,000
0%
327 Parking Lots
Expenditures
Debt Services (Principle and Interest paid)
147,794
0
-
330 Roads & Structures
45
Expenditures
Contracted Services
0
12,000
100.0%
334 Safe Roads
Expenditures
Materials & Supplies
12,549
18,500
32.2%
Contracted Services
45,428
50,000
9.1 %
350 Waste Collection
Revenue
User Charges
(73)
(22,500)
99.7%
Expenditures
Materials & Supplies
0
22,500
100.0%
351 Recycling Collection
Revenue
User Charges
(15)
(1,500)
99.0%
Expenditures
Materials & Supplies
0
1,500
100.0%
380 Road Maintenance
Revenue
User Charges
(26,477)
(19,500)
-35.8%
Expenditures
Salaries, Wages & Benefits
603,994
624,000
3.2%
Materials & Supplies
820,052
942,775
13.0%
Contracted Services
521,398
915,200
43.0%
381 Hardtop Maintenance
46
Expenditures
Salaries, Wages & Benefits
385,208
463,000
16.8%
Materials & Supplies
389,039
520,500
25.3%
Contracted Services
161,045
160,000
-0.7%
382 Loosetop Maintenance
Expenditures
Salaries, Wages & Benefits
66,527
59,500
-11.8%
Materials & Supplies
303,644
341,000
11.0%
383 Winter Control
Revenue
User Charges
(10,947)
(20,000)
45.3%
Expenditures
Salaries, Wages & Benefits
770,359
958,600
19.6%
Materials & Supplies
1,325,498
2,072,500
36.0%
Contracted Services
30,619
0
-
384 Safety Devices
Expenditures
Salaries, Wages & Benefits
241,677
228,000
-6.0%
Materials & Supplies
341,100
397,500
14.2%
Contracted Services
51,970
50,000
-3.9%
386 Storm Water Management
Expenditures
Salaries, Wages & Benefits
14,351
20,000
28.2%
Materials & Supplies
8,186
13,000
37.0%
47
Contracted Services
134,112
92,000
-45.8%
387 Regional Roads
Expenditures
Salaries, Wages & Benefits
4,306
9,000
52.2%
Materials & Supplies
17,785
35,000
49.2%
388 Fleet
Revenue
User Charges
(1,290,903)
0
-
Expenditures
Salaries, Wages & Benefits
624,815
751,228
16.8%
Materials & Supplies
1,212,453
109,600
-1006.3%
Transfers from RES / RF / CAP Fund
1,085,000
1,085,000
0%
Total Public Works
$ 23,744,603
$ 27,448,416
13.5%
Highlights
Unassigned
The Full Time Work from Other's account is recoverable meaning the overage under Salaries, Wages and Benefits will be
resolved through invoicing.
48
Administration
Miscellaneous Revenues for Operations and Engineering were combined this in 2021 due to the departmental
reorganization. There were also funds drawn on from a Letter of Credit which will be used to complete abandoned work by
a developer.
Increased revenues have been seen in Engineer Review and Inspection Fees as the budget is based on an estimate of
planned projects.
Permit Revenue is double the budget expectation this year due to the Municipal Consent (MC) fees for Bell and Rogers.
In 2021, additional fees were charged to each company for fibre -related MCs. These charges were temporary and are not
guaranteed in future years.
Parks
The Materials and Supplies category is over budget due to the agreement with Darlington Soccer to absorb the irrigation
expenses for Municipal -owned fields through their COVID-19 financial constraints.
Rental expenses in Parks have exceeded the budget due to COVID-19 related needs. Extra portable toilet rentals,
servicing and daily cleanings were necessary to facilitate COVID-19 protocols.
Cemetery
Cemetery revenue overages are attributed to higher than anticipated headstone maintenance and miscellaneous burial
fees collected.
Materials and Supplies balance is due to the legislative required transfers of Perpetual Care Funds (a portion of cemetery
plot sales) to the Cemetery Trust Funds.
49
Road Maintenance
Increase participation in Senior Snow clearing is reflective in the higher revenues seen this year. The program increased
from 319 participants in the 2019-2020 season to 332 participants in the 2020-2021 season.
Safety Devices
Accounting entries will be made for yearend to reallocate unexpended prior year funds from the Railway Crossing
Maintenance account to offset the overages in Contracted Services.
Stormwater Managements (SWM)
Accounting entries will be made for yearend to allocate the committed funds for contract CI2021-31. Funding for this
contract is split between current year's budget and prior year's carryover. Once these entries are complete the Contracted
Services account will not be over budget.
Waste and Recycling Collection
Both Waste and Recycling Collection bin sales have ceased with COVID-19. Residents can now purchase or replace bins
at the Region of Durham Waste Transfer Site on Bowmanville Blvd.
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 this account's expenses are offset by fleet revenues.
50
Community Services
130 Admin
Revenue
User Charges
Expenditures
Salaries, Wages & Benefits
Materials & Supplies
Contracted Services
Transfers from RES / RF / CAP Fund
250 Contributions
Revenue
Transfer between Funds
420 Recreation Services Admin
Revenue
User Charges
Expenditures
Salaries, Wages & Benefits
Materials & Supplies
421 Facilities
Revenue
User Charges
Expenditures
Salaries, Wages & Benefits
Materials & Supplies
Contracted Services
Debt Services (Principle and Interest paid)
(31,703)
905,786
271,430
12,447
1,750,269
(1,609,819)
(121)
1,099,139
11,788
(1,143,540)
3,751,374
2,618,312
229,552
1,514,261
4.
(21,500) -47.5%
928,606
2.5%
62,325
-335.5%
0
-
1,273,700
-37.4%
(1,592,199)
-1.1 %
(1,230)
90.2%
993,041
-10.7%
19,400
39.2%
(1,969,479)
41.9%
4,342,760
13.6%
3,152,495
16.9%
317,107
27.6%
1,514,261
0%
51
Transfers from RES / RF / CAP Fund
1,144,050
1,144,050
0%
423 Concessions
Revenue
User Charges
(1,239)
(34,990)
96.5%
Expenditures
Salaries, Wages & Benefits
8
0
-
424 Aquatic Programs
Revenue
User Charges
(275,596)
(776,373)
64.5%
Expenditures
Salaries, Wages & Benefits
277,155
705,749
60.7%
Materials & Supplies
20,138
53,889
62.6%
425 Fitness Programs
Revenue
User Charges
(75,474)
(436,454)
82.7%
Expenditures
Salaries, Wages & Benefits
136,957
305,547
55.2%
Materials & Supplies
5,849
27,850
79.0%
426 Recreation Programs
Revenue
User Charges
(140,232)
(309,085)
54.6%
Expenditures
Salaries, Wages & Benefits
132,335
284,029
53.4%
Materials & Supplies
8,953
37,580
76.2%
Contracted Services
3,271
23,500
86.1 %
Rents/Financial Expenses
0
1,000
100.0%
427 Community Development
52
Revenue
User Charges
(131,700)
(164,650)
20.0%
Expenditures
Salaries, Wages & Benefits
56,285
76,209
26.1 %
Materials & Supplies
139,091
182,330
23.7%
Contracted Services
28,008
43,000
34.9%
428 55+ Active Adults
Revenue
User Charges
(27,027)
(122,347)
77.9%
Expenditures
Salaries, Wages & Benefits
30,480
102,242
70.2%
Materials & Supplies
2,832
12,600
77.5%
Contracted Services
0
5,500
100.0%
429 Customer Service
Revenue
User Charges
(17,479)
(16,500)
-5.9%
Expenditures
Salaries, Wages & Benefits
699,324
921,464
24.1 %
Materials & Supplies
56,184
93,146
39.7%
430 Smallboards - Consolidated
Expenditures
Contracted Services
1,192
0
-
External Transfers to Others
8,975
0
-
431 Smallboards - Non -Consolidated
Expenditures
Contracted Services
1,374
0
-
External Transfers to Others
9,412
0
-
53
440 Libraries
Expenditures
Materials & Supplies
3,319
4,100
19.0%
Contracted Services
3,943
6,915
43.0%
Debt Services (Principle and Interest paid)
78,466
78,466
0%
450 Client Services
Expenditures
Salaries, Wages & Benefits
532,037
585,699
9.2%
Materials & Supplies
9,360
17,650
47.0%
451 Tourism
Expenditures
Salaries, Wages & Benefits
230,085
235,262
2.2%
Materials & Supplies
49,556
66,500
25.5%
Contracted Services
26,607
24,250
-9.7%
460 Museum
Expenditures
Materials & Supplies
13,809
18,700
26.2%
Contracted Services
8,378
7,300
-14.8%
473 Community Grant Program
Expenditures
External Transfers to Others
38,500
64,000
39.8%
480 Municipal Sponsorships
Expenditures
External Transfers to Others
75,920
35,000
-117%
Total Community Services
$12,542,281
$12,322,415
-1.8%
54
Highlights
Administration
COVID-19 cost recovery funds were received from the Region of Durham for the use of the Garnet B. Rickard Centre as a
vaccination clinic.
The large overage in Material and Supplies is due to the (unbudgeted) use of Defron Security to provide proof of
vaccination and active screening services for COVID-19 at municipal buildings and community halls. COVID-19 recovery
funding will be used to cover these costs
The unbudgeted expense in Contracted Services relates to Council's direction through GG-336-21, that Staff create
conceptual plans for an expanded recreation facility at Garnet B. Rickard. Architect services were acquired to fulfill this
request. The council resolution specified that the funds would come from the Community Services Capital Reserve Fund.
The remaining costs in the consulting account are awaiting yearend entries for reallocation to the appropriate accounts.
Facilities, Aquatic Programs and Recreation and Fitness
Revenues across these subdepartments are below budget expectations as the 2021 Budget was developed not
anticipating the level of restrictions that remained in place for the majority of 2021. During the fourth quarter, facilities were
able to re -open with a few programs and activities running. Although COVID restrictions limited capacity resulting in a
direct impact on revenues, Staff were diligent in controlling expenditures where possible to mitigate the impact on the
budget.
Customer Service
The recreation subsidy from the Region of Durham was received in the fourth quarter of 2021. This will be used to assist
eligible residents with registration fees to Clarington programs.
55
Tourism
The over expenditure in Contracted Services is as a result of the wall wraps completed in the facilities to create Tourism
Hubs. Funding received this year from the TIAO grant will be used to offset these expenses.
Museum
Unforeseen maintenance was required in the fourth quarter of 2021, causing the overage in Contracted Services
56
Community Services Revenue Summary
The following table summarizes the revenue sources for Community Services over the last three years. The COVID-19
pandemic has affected Community Services the greatest. The following table shows the decrease in revenue; however, it
should be noted that the Municipality has taken steps to mitigate the lost revenue with corresponding reductions in costs
where available.
Admin
($78,426)
($14,358)
($31,703)
($21,500)
Contributions
0
(1,616,352)
(1,609,819)
(1,592,199)
Recreation Services Admin
(2,893)
(210)
(121)
(1,230)
Facilities
(2,259,033)
(1,267,112)
(1,143,540)
(1,969,479)
Concessions
(43,206)
(7,704)
(1,239)
(34,990)
Aquatic Programs
(1,171,739)
(354,374)
(275,596)
(776,373)
Fitness Programs
(515,987)
(197,416)
(75,474)
(436,454)
Recreation Programs
(550,463)
(99,986)
(140,232)
(309,085)
Community Development
(153,316)
(133,820)
(131,700)
(164,650)
55+ Active Adults
(127,296)
(52,189)
(27,027)
(122,347)
Customer Service
(16,268)
(22,439)
(17,479)
(16,500)
Total Community Services
($4,918,627)
($3,765,960)
$(3,453,930)
$(5,444,807)
57
Planning Services
000 Unassigned
Expenditures
Salaries, Wages & Benefits
$ 3,918
$ 4,221
7.2%
Materials & Supplies
16,320
234,750
93.0%
Transfers from RES / RF / CAP Fund
640,375
640,375
0%
130 Admin
Revenue
User Charges
(1,377,470)
(1,114,991)
-23.5%
Other Income - Sale of Assets (NON-TCA)
(280,000)
0
-
Expenditures
Salaries, Wages & Benefits
3,196,202
3,632,851
12.0%
Materials & Supplies
72,973
109,550
33.4%
Contracted Services
82,595
946,000
91.3%
Transfers from RES / RF / CAP Fund
394,699
12,500
-3057.6%
250 Contributions
Revenue
Transfer between Funds
(13,822)
(1,000)
-1282%
321 Building Inspection
Revenue
User Charges
(3,039,122)
(1,769,500)
-71.8%
Fines/Penalties on Interest
0
(500)
100.0%
Expenditures
Salaries, Wages & Benefits
1,242,715
1,249,151
0.5%
Materials & Supplies
59,819
101,215
40.9%
Contracted Services
56,009
199,000
71.9%
Transfers from RES / RF / CAP Fund
227,950
227,950
0%
58
385 Environmental
Revenue
User Charges
(1,170)
0
-
430 Smallboards- Consolidated
Expenditures
Materials & Supplies
60
1,500
96.0%
502 Development Review
Revenue
User Charges
(288,666)
0
-
Expenditures
Materials & Supplies
23,298
0
-
Contracted Services
198,435
0
-
Total Planning and Development Services
$ 1,215,118
$ 4,473,072
72.8%
Highlights
Administration
Revenues are higher than the budget at the end of the fourth quarter due to several factors. Some of which include but
are not limited to; increased volume and scale of applications of various types of housing builds, increase in land division
applications and increases in Compliance Letter volume due to increase in residential sales/closings.
The proceeds from the sale of land were reallocated to the Municipal Acquisition Reserve. This is where all proceeds from
land sales are recorded.
59
Funds received for a building at Camp 30 were transferred to the General Municipal Purpose Reserve Fund. These funds
are to be used for security and maintenance at Camp 30 per the legal agreement and Council's approval.
Building Inspection
The Building Permit revenue is trending higher this year than expected. Staff attribute this to residents building and
renovating due to COVID-19 while staying home as this revenue is market dictated. However, in the fourth quarter there
were permit applications for three large condo projects which increased the revenues significantly from those seen in the
third quarter.
a