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HomeMy WebLinkAboutTR-86-83 CORPORATION OF THE TOWN OF NEWCASTLE TREASURY DEPARTMENT K. CAMPBELL, C.A., TREASURER 40 TEMPERANCE STREET TEL.(416) 623-3379 BOWMANVILLE, ONTARIO L1C 3A6 REPORT TO THE GENERAL PURPOSE AND ADMINISTRATION COMMITTEE MEETING OF DECEMBER 5, 1983 REPORT NO. : TR-83-86 SUBJECT: YEAR-TO-DATE BUDGET REPORT TO NOVEMBER 24, 1983 RECOMMENDATION: It is respectfully recommended: 1. That this report be received for information. BACKGROUND AND COMMENT It is appropriate at this time to make Committee and Council aware of the financial postion of the Town versus the 1983 budget allocations as at November 24, 1983. The summarized report of revenue and expenditures by function to November 24, 1983 is attached to this report. Staff have reviewed each revenue and expenditure budget area noting only the areas of concern. Budget areas to which no reference has been made are considered to be operating within the constraints and guidelines of the 1983 budget. I�V 2 GPA 05.12.83 TR-83-86 GENERAL GOVERNMENT General Government expenditures are currently 26% unexpended, which is considered reasonable at this time. Areas of concern include the salary account in the Administrator's office (0% unexpended) due to the accumulated vacation pay paid to the previous Administrator on his departure. The funds provided for negotiations of the Town' s contracts is 100% unexpended and will be rebudgetted in 1983. In the Clerk' s Department the major item still in process and incomplete at this time, is the land registry matter in the East Beach area (94% unexpended) . The surveyor has indicated that this matter should be completed by year end. Unclassified Administration is 47% unexpended with expenditures regarding audit -fees and the library heating system renovation mayor items still to be charged. The Inflation Restraint Program has resulted in some additional audit charges, as yet to be assessed. The program, as approved by the Province, placed the audit costs on the municipality. 3 GPA 05.12.83 TR-83-86 GENERAL GOVERNMENT Purchasing (8% unexpended) has experienced an over expenditure in its advertising budget of 11% at this time. Since this is the first full year of operation of the centralized purchasing system this might have been expected. Previously each department was responsible for the advertising costs of tenders, etc. This matter will be reviewed for the 1984 budget, now that numbers of placements, etc. are better known. The Orono buildings account (30% overexpended) is being reviewed by staff as there appear to be charges made to the rental account which are inappropriate. Adjustments, as necessary, will be made prior to year end. In 1984, the Orono Town Hall and the Armouries expenses will be separated to give better control and follow up on these expenditures. PROTECTION TO PERSONS AND PROPERTIES - (38% unexpended) The Fire Department is presently 45% unexpended principally as a result of the fire fighting equipment which is still to be received, and the construction of Orono Fire Hall still to be completed. Both of these transactions are slated to be completed by year end. In Fire Department Administration, the salary account (8% unexpended) may be overbudget at year end as a result of the substantial accumulated vacation pay due to the previous Fire Chief upon this retirement. 4 GPA 05.12.83 TR-83-86 PROTECTION TO PERSONS AND PROPERTIES In the various halls, monies provided for new firefighting clothing has not been expended. The Fire Department is awaiting final approval of the clothing by the Fire Marshall 's office before comitting funds. These monies may have to be rebudgetted in 1984 after approval is received from the Province. By-Law Enforcement (10% unexpended) has over- expenditures in travel expenses (3%) and legal costs (176%) . These costs reflect increased activity in By-Law Enforcement and an increase in the number prosecutions. Animal Control (3% unexpended) will be over budget at year-end. The over-expenditure results from several factors, some of which are uncontrollable. The cost of medical benefits for the employees has been under-budgetted by approximately $600. Gasoline and oil for the van are slightly over-budget at this time (1% over) . The repairs to the building which were made necessary due to concerns about the conditions in which the animals were kept cost $300 more than budgetted. Travel expenses related to the sale of licences by persons other town staff were $484 more than budgetted. Because of the active program undertaken by those persons hired on a commission basis, the commision account is 28% over-expended. The purchase of licences and permit supplies is over-budget $270 to reflect the cost associated with the change in the permit form and the new tags. Livestock damages, over-which we have no control , is over expended by $1 ,050 and there are currently a number of claims to be settled prior to year-end. 5 GPA 05.12.83 TR-83-86 TRANSPORTATION SERVICES The Administration and Overhead accounts for the Public Works Department appear on the whole to be reasonably in line with the 1983 budget projections. Bridge and Culvert Construction (47% unexpended) will experience some minor expenditures prior to year end, but the major share of this budget has been reallocated to Bridge and Culvert Maintenance (24% unexpended) , which has the same subsidy level . Bridge and Culvert Maintenance is ongoing at this time in various areas throughout the Town. The major component of this budget was the repair of the bailey bridge on the Jackman Road. Since this reallocation was made in the budget MTC has decided to replace the old bailey bridge with a newer one. Therefore, the $40,000 allocated to this project will not be needed in its entirety. The Town, will however, be responsible for costs of installation, supervision by MTC, removal and transportation of the old bridge, transportation of the new bridge, guiderails, etc. Costs are anticipated to be in the $5,000 to $10,000 range in order to make the replacement bailey bridge operational . Road Construction (60% unexpended) is proceeding at this time with some projects being expanded to expend winter control budget funds not expended. A major element of this budget, Holt Road (Ontario Hydro) budgetted at $300,000 was not proceeded with in 1983 at Ontario Hydro's request. 6 GPA 05.12.83 TR-83-86 TRANSPORTATION SERVICES This project is fully funded by Ontario Hydro and has no net impact on the budget. Progress on Scugog Street has been slower than anticipated due to the sanitary sewer works for the Region and we anticipate it will be approximately $50,000 under budget at year end. The construction on the connecting link in Newcastle is progressing very well , but we also expect it to fall $50,000 short of budgetted expenditures by year end. Work on Firner Avenue, Ormiston Street and Toulley Road has been expanded to make up for anticipated shortfalls in budgetted expenditures. To date we have no billings for the Lovekin Crossing but the Railway is proceeding with the works and it should be substantially complete by -the year end. Roadside Maintenance (23% over-expended) is continuing at this time with activities such as tree removal and ditching taking the place of winter control activities. Hardtop maintenance (7% over-expended) is principally completed with some patching and resurfacing not associated with road construction still to be undertaken. Roadside Maintenance (Loosetop) (12% unexpended) activities are limited at this time to the gravel patching and resurfacing and the crushing operations. It is anticipated this budget will be fully expended. 7 GPA 05.12.83 TR-83-86 TRANSPORTATION SERVICES Winter control (59% unexpended) funds have been largely reallocated by the Director of Works to other activities mentioned. As of thi s date, the requi rement for men and equipment for winter control has been minimal . We are watching this activity closely and are trying to offset this budget shortfall with other expenditures. As you might surmise this is a very delicate balancing of activities to keep within the overall Transportation Services budget. With the Safety Devices (16% unexpended) work has been substantially completed with only minor works anticipated to year end and any emergency repairs which might be necessitated through traffic mishaps. Billings for railway crossing maintenance for the last four to five months of the year are still outstanding and these may bring the expenditures within the anticipated budget. Miscellaneous Public Works (42% unexpended) consists primarily of the salt storage structure costs of $75,000 which have as yet to be transferred to the Capital Reserve for 1984, as previously approved. Public Works - Works for Others includes the Region of Durham costs for Scugog Street which are entirely recovered from the Region. 8 GPA 05.12.83 TR-83-86 TRANSPORTATION SERVICES Parking Enforcement (1% unexpended) will be overbudget as a result of the change in personnel during the year and the costs associated with that change. In addition, repairs to meters and postage costs have both exceeded budget amounts. This activity is fully funded by the Parking Reserve Fund and has no impact on the net budget. Street Lighting (21% unexpended) with all capital works proceeding and final billings for electrical useage and maintenance, as yet to be received, it should be within its 1983 budget projection. The operation of the Public Works Department fleet has resulted in a potential net gain to the equipment reserve of $204,383, at this time. The final adjustment to these accounts for rental revenue and operation costs in December and November should result in an addition to the reserve of approximately $180,000 to $190,000 in 1983. ENVIRONMENTAL SERVICES Storm Sewer maintenance (72% unexpended) consists primarily of the Wellington Street project which is substantially complete but unbilled, at this time. Staff have entered into discussions with MTC as to the eligibility of the Courtice Storm Sewer outfall for subsidy. Although we have sufficient -funds to cover the costs for this project, it seems prudent to staff to have an "ace in the hole" , if we find ourselves short of subsidizable expenditures in any given year. 9 GPA 05.12.83 TR-83-86 ENVIRONMENTAL SERVICES For some unknown reason this project has never been evaluated by MTC, so we are currently awaiting their assessment of our representations to them. The MTC response should be forthcoming late in December. Garbage collection in Orono and Newcastle which is undertaken through a contract is in line with the budget projections. Garbage collection in Bowmanville which is performed by Town forces is underspent primarily due to the use of student labour during the summer months. The change in labour force substantially reduced the wage costs associated with this activity and allowed the more experienced labourers to be employed in other activities. HEALTH SERVICES - (26% unexpended) Cemetery operations are well within the budget projections with some savings realized through the use of student labour for the summer maintenance. (see notes on Parks Facilities Maintenance accounts) . ,RECREATION AND CULTURAL SERVICES - (14% unexpended) Parks Facilities Maintenance (7% unexpended) is in this position due to allocation errors on timesheets for those employees who work in the parks, cemeteries and arenas. The associated benefits have also been misallocated because of the errors on the original timesheets. Community Services have been informed of this problem and with Treasury Department staff are rectifying it. - 10 GPA 05.12.83 TR-83-86 RECREATIONAL AND CULTURAL SERVICES Betiv4een the salary accounts for the cemeteries, parks facilities maintenance and the arenas, there is sufficient budget to cover the projected expenditures. A similiar kind of allocation error appears to have occurred at the Fitness Center with their salary accounts and this is being investigated. Other than those two areas there appear to be no areas of concern in tl"wi Community Services expenditure budget. PLANNING AND DEVELOPMENTAL SERVICES - (19% unexpended) Administration for the department (22% unexpended) is generally in line with the budget with legal costs exceeding budget by $2,400 but OMB hearing costs to date being only $100 expended out of a possible 1)17,000. Appraisal fees associated with some subdivision property matters have exceeded budget. In some cases, the aforementioned costs, are recoverable from the developer concerned. The various committees and projects (Main Street Redevelopment) are within acceptable budget limits at this time and are no reason for concern. GPA 05.12.83 TR-83-86 PLANNING AND DEVELOPMENTAL SERVICES Levies to the Region and School Boards are substantially paid at this time, with only the final installment for the school boards outstanding and any liability due to the higher authorities as a result of supplementary taxes less taxes written off. These will all be paid by year end to avoid any unnecessary interest charges. REVENUE In general , the revenue accounts are well within the budget expectations with few exceptions. In the specific grants which includes the road subsidy, the Director of Public Works and the Treasurer have endeavoured to adjust the spending to meet the subsidy allocation of $1,533,000. The Town has recently had its 1982 subsidy submission audited, resulting in the loss of approximately $61 ,000 in 1982 subsidy. This error resulted from some misinformation provided by the MTC regarding the subsidy percentage on administrative costs. These monies can not be recouped and will result in a reduction in the cash flow for the 1983 subsidy. The Director of Public Works and the Treasurer have discussed this matter with MTC and had the subsidy matter clarified. Also, staff feel that given the very light winter in 1982-83 that we could not have prevented the shortfall in subsidizable expenditures without the very real risk of overexpending if it had snowed in December of 1982. 12 CPA 05.12.83 TR-83-86 REVENUE In addition, staff feel the projects proposed for 1982 were all completed and some for less than estimated which resulted in a savings to the municipality. If we are to proceed with conservative budget control and not overexpend; it is very difficult not to encounter either shortfalls or overexpenditures in subsidizable expenditures. The shortfall from the 1982 subsidy can be made up from the surpluses which have occurred in other revenue areas. Fees and Service Charges are presently 5% overbudget with areas of particular note being hockey registration $3,500 overbudget; swimming fees $8,100 overbudget; roller skating $1 ,700 underbudget and memberships at the Fitness Centre $8,400 underbudget. Other revenue areas are generally in line with expectations. Fees and Service Charges - Other Municipalities consists principally of charges to the Region regarding the Scugog Street reconstruction. All Licence and Permit revenues are slightly ahead of projections with the overall account being 22% over budget. Rents and concessions are somewhat behind anticipated levels with arena rentals 22% below budget, and canteen sales lower as are the canteen supplies. With the November and December rentals and concessions this revenue area may come in 5% to 10% under budget. - 13 GPA 05.12.83 TR-83-86 REVENUE Penalties and Interest on taxes is approximately $98,000 overbudget with the higher interest rates still not reducing our outstanding taxes as a percentage of the current levy below 10%. Historically our percentage of taxes outstanding has been in the 8% to 10% range for a number of years. Staff had anticipated that the higher rate of interest would encourage taxpayers to pay more promptly and hopefully bring our outstanding taxes down into the 7% range. The investment of surplus general funds has netted the Town approximately $45,000 more than budgetted. The Town has been fortunate to secure some good investment rates at various institutions which have generally paid a better rate of return than the banks with no preceptibly greater risk. In conclusion, staff find that the Town is in good financial health and we do not anticipate any significant deviations from those anticipated in the 1983 budget. If projections proceeds as seen now, it would be possible for Council to consider the complete funding of the Orono Fire Hall project and Library heating renovation project out of the 1983 current budget. GPA 05.12.83 TR-83-86 In January, when the final financial position of the Town is more clearly seen, a report on those two items will be forthcoming to Committee for final disposition. Respectfully submitted, Kathryn A. Campbell ,C.A. , B.Comm. , Treasurer *gf Attachment