|
2. DISPOSITION OF 2005 OPERATING
SURPLUS/DEFICIT
|
COMMITTEE
RECOMMENDATIONS
That as part of the finalization of 2005 operations, Council approve the following transfers of funds as detailed in this report:
1.
The
transfer of $2,032,000 from the Ottawa Public Library Reserve Fund to offset
part of Ottawa Public Library Deficit,
2.
The
transfer of $1,863,000 from the Transit Capital Reserve to offset the Transit
Deficit,
3.
The
transfer of $5,045,000 from the Rate Supported Capital Reserve Fund to the Rate
Supported Operating Fund to offset the Rate Support Fund Deficit, and;
4.
The
transfer, in 2006, of $356,000 from the City Wide Capital Reserve Fund to the
Ottawa Police Services Capital Reserve Fund.
RECOMMENDATIONS
DU COMITÉ
Que le Conseil approuve les transferts de fonds
suivants, tels que détaillés dans le présent rapport, dans le cadre du
parachèvement des opérations de 2005 :
1.
le transfert de 2 032 000 $ du fonds de réserve de la Bibliothèque
publique d’Ottawa afin d’éponger en partie le déficit de cette dernière;
2.
le transfert de 1 863 000 $ du fonds de réserve pour immobilisations du
transport en commun afin d’éponger le déficit du transport en commun;
3.
Le transfert de 5 045 000 $ du fonds de réserve pour les immobilisations
financées par la tarification des services au fonds d’administration générale
financé par la tarification des services afin d’éponger le déficit de ce fonds;
4.
le transfert en 2006 de 356 000 $ du fonds de réserve panmunicipal pour
immobilisations au fonds de réserve pour immobilisations du Service de police
d’Ottawa.
DOCUMENTATION
1. Chief Corporate Services
Officer’s report dated 29 May 2006
(ACS2006-CRS-FIN-0024).
Report
to/Rapport au :
Corporate
Services and Economic Development Committee
Comité des services organisationnels et du développement économique
and Council / et au Conseil
Submitted by/Soumis par : Greg
Geddes, Chief Corporate Services Officer/Chef des Services généraux
Contact Person/Personne ressource : Wayne Martin, Manager, Accounting and Financial Reporting/Gestionnaire, Vérification et
rapports, Financial Services/Services
financiers
(613)
580-2424 x, 25183, Wayne.Martin@ottawa.ca
|
SUBJECT: |
Disposition of 2005
Operating Surplus/Deficit |
|
|
|
|
OBJET : |
REPORT RECOMMENDATIONS
That as part of the finalization of 2005
operations, the Corporate Services and Economic Development Committee recommend
Council approve the following transfers of funds as detailed in this report:
1. The
transfer of $2,032,000 from the Ottawa Public Library Reserve Fund to offset
part of Ottawa Public Library Deficit,
2. The
transfer of $1,863,000 from the Transit Capital Reserve to offset the Transit
Deficit,
3. The
transfer of $5,045,000 from the Rate Supported Capital Reserve Fund to the Rate
Supported Operating Fund to offset the Rate Support Fund Deficit, and;
4. The
transfer, in 2006, of $356,000 from the City Wide Capital Reserve Fund to the
Ottawa Police Services Capital Reserve Fund.
RECOMMANDATIONS DU RAPPORT
Que le Comité des services organisationnels et
du développement économique recommande au Conseil d’approuver les transferts de
fonds suivants, tels que détaillés dans le présent rapport, dans le cadre du
parachèvement des opérations de 2005 :
1. le transfert de 2 032 000 $ du fonds de réserve de la
Bibliothèque publique d’Ottawa afin d’éponger en partie le déficit de cette
dernière;
2. le transfert de 1 863 000 $ du fonds de réserve pour
immobilisations du transport en commun afin d’éponger le déficit du transport
en commun;
3. Le transfert de 5 045 000 $ du fonds de réserve pour les
immobilisations financées par la tarification des services au fonds
d’administration générale financé par la tarification des services afin
d’éponger le déficit de ce fonds;
4. le transfert en 2006 de 356 000 $ du fonds de réserve
panmunicipal pour immobilisations au fonds de réserve pour immobilisations du
Service de police d’Ottawa.
BACKGROUND
In
conjunction with the audited financial statements, it is necessary to obtain
Council approval of the disposition of any surplus and the funding of any
deficit that occurred. This report provides an analysis of the final results of
operations for 2005 and provides funding recommendations related to the closing
of 2005 operations.
Many
areas of City operations achieved surpluses in their operations, however the
overall result was a deficit of $20.9 million for 2005. Of note, $12 million of this amount resulted
from a timing issue regarding the Hydro Ottawa dividend. The $12 million was received by the City in
2006 and applied against the deficit.
The remaining deficit is $8.9 million.
Library Services incurred a deficit of $4 million as result of
resolution of the pay equity and job evaluation process. Another $5 million deficit was incurred in
the water and sewer fund as a result of budgeted revenues not being
achieved. To put this in context, the
$8.9 million deficit represents 0.45% of the City’s budget. Transfers from the appropriate reserves have
been recommended in this report to eliminate the $8.9 million deficit.
DISCUSSION
A
summary of the 2005 Disposition of Surplus/(Deficit), Summary by Fund
follows. A summary of the 2005
Operating Results by Department is provided in Annex A. In addition, an explanation of the major
variances by department is provided in Annex B.
|
Disposition of
Surplus/(Deficit), Summary by Fund |
|||||||
|
|
|
Tax
Supported |
|
Rate |
Grand |
||
|
|
OPL |
Transit |
City
Wide |
OPS |
Total |
Supported |
Total |
|
|
$'000 |
$'000 |
$'000 |
$'000 |
$'000 |
$'000 |
$'000 |
|
2005 Operating Results: |
|
|
|
|
|
|
|
|
Departmental Surplus/(Deficit) |
(4,711) |
(2,594) |
5,885 |
356 |
(1,064) |
4,106 |
3,042 |
|
|
|
|
|
|
|
|
|
|
Non-departmental Surplus/(Deficit) |
(115) |
731 |
(18,756) |
3,309 |
(14,831) |
(9,151) |
(23,982) |
|
Total Surplus/(Deficit) |
(4,826) |
(1,863) |
(12,871) |
3,665 |
(15,895) |
(5,045) |
(20,940) |
|
Disposition of Surplus |
|
|
|
|
|
|
|
|
OPS Surplus Returned to City |
|
|
3,665 |
(3,665) |
0 |
|
0 |
|
|
(4,826) |
(1,863) |
(9,206) |
0 |
(15,895) |
(5,045) |
(20,940) |
|
Disposition of Deficit |
|
|
|
|
|
|
|
|
Transfer from OPL R/F |
2,032 |
|
|
|
2,032 |
|
2,032 |
|
Additional City Funding –
OPL |
2,794 |
|
(2,794) |
|
0 |
|
0 |
|
Transfer From Transit
Capital R/F |
|
1,863 |
|
|
1,863 |
|
1,863 |
|
Transfer From Rate Supported
Capital R/F |
|
|
|
|
0 |
5,045 |
5,045 |
|
|
4,826 |
1,863 |
(2,794) |
0 |
3,895 |
5,045 |
8,940 |
|
|
|
|
|
|
|
|
|
|
2005 Deficit Carried Forward to 2006 |
0 |
0 |
(12,000) |
0 |
(12,000) |
0 |
(12,000) |
The deficit in the Ottawa Public Library
Operating Fund is $4,826,000. This
deficit is the result of:
(a)
a departmental deficit of $4,711,000 as explained in Annex B,
(b) a non-departmental deficit
of $115,000 due to lower investment
income attributable to the Ottawa Public Library Fund.
It is recommended that the transfer of
$2,032,000 from the Ottawa Public Library’s reserve funds fund part of the
deficit. The Ottawa Public Library
Board approved this transfer on September 12, 2005. The remaining deficit of $2,794,000 will be funded through a
transfer from the City Wide Operating Fund.
The deficit in the Transit Operating Fund is $1,863,000. This deficit is the result of:
(a) a departmental
deficit of $2,594,000 as explained in Annex B,
(b)
offset by a surplus of $731,000 in the non-departmental accounts as a result of
higher than budgeted investment income attributable to the Transit Fund and
higher than budgeted supplementary assessment income.
It is recommended that a transfer of $1,863,000 from the Transit Capital
Reserve Fund be made to fund this deficit.
The
surplus in the Ottawa Police Services Operating Fund is $3,665,000. This surplus is the result of:
(a) departmental surplus of
$356,000,
(b) a surplus in the
non-departmental accounts of $3,309,000.
An
analysis of the departmental surplus has been reported to the Ottawa Police
Services Board and a summary of this analysis is provided in Annex B.
In
2005, a separate tax rate was created to fund the Ottawa Police Services
budgetary requirements. When creating a
new tax rate, estimates for the appropriate share of supplementary taxes,
investment income, tax rebates and remissions related to the police tax rate
are required. Variances in the
budgetary provisions for the non-departmental items created a surplus of
$3,309,000. These provisions have been
corrected in the 2006 Operating Budget.
In
accordance with the reserve by-laws, the total police surplus of $3,665,000 was
to be returned to the City. On April 12, 2006, subsequent to the finalization
of the City’s 2005 financial statements, Council approved the Ottawa Police
Service Board’s recommendation that the departmental surplus of $356,000 be contributed
to the Ottawa Police Services Capital Reserve Fund. This transfer has been included in the recommendations.
The deficit in the City Wide Operating Fund, before the previously noted
adjustments, is $12,871,000. This
deficit is the result of:
(a) a departmental
surplus of $5,885,000 as explained in Annex B and,
(b) a deficit of
$18,756,000 in the non-departmental accounts.
After adjusting for the additional funding to the Ottawa Public Library
and the return of the Ottawa Police Services surplus, the deficit in the City
Wide Operating Fund is $12,000,000.
This deficit is due to the timing difference in the receipt of the Hydro
Ottawa dividend. The 2005 budget
included a dividend from Ottawa Hydro of $12 million for their 2005 fiscal year. As a dividend can only be recognized when it
is declared, the dividend will become 2006 revenue. On April 13, 2006, Ottawa Hydro declared the dividend and the
City is in receipt of the $12 million.
As the deficit is the result of a timing difference, it is recommended
that the remaining deficit not be funded in 2005 but be carried forward to
2006. The City will incur this type of
deficit every year only because of the timing difference.
The deficit in the Rate Supported Operating
Fund is $5,045,000. This deficit is the
result of:
(a)
a departmental surplus of $4,106,000 as explained in Annex B, and
(b)
a deficit of $9,151,000 in the non-departmental accounts. The non-departmental deficit was primarily
caused by a shortfall in water and sewer rate revenues of $5,627,000 and lower
than planned investment income attributable to the Rate Support Fund of
$2,626,000.
It is recommended that a transfer of $5,045,000
from the Rate Supported Capital Reserve Fund be made to fund this deficit.
CONSULTATION
All
departments have been consulted in the preparation of this report. Public consultation is not applicable.
FINANCIAL IMPLICATIONS
The
Reserve Funds will be adjusted as indicated in this report.
ATTACHMENTS
Annex A – Operating Results by Department
Annex B – Variance Analysis – 2005 Operating Results
DISPOSITION
The
Financial Services Branch will make the necessary accounting adjustments.
ANNEX A – Operating Results by Department 2005 Operating Budget Corporate Summary
|
Year
End - Actual vs Budget by Expenditures/Revenues |
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Surplus / (Deficit) |
||
|
|
2005 Actual |
|
2005 Budget |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exp |
Revenue |
Net |
|
Exp |
Revenue |
Net |
|
Gross |
Revenue |
Net |
|
|
$000 |
$000 |
$000 |
|
$000 |
$000 |
$000 |
|
$000 |
$000 |
$000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Elected
Officials |
7,953 |
(3) |
7,950 |
|
8,603 |
- |
8,603 |
|
650 |
3 |
653 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Office of the
Auditor General |
1,428 |
- |
1,428 |
|
1,429 |
- |
1,429 |
|
1 |
- |
1 |
|
|
|
|
|
|
|
|
|
|
- |
- |
- |
|
City Manager |
3,296 |
(150) |
3,146 |
|
3,739 |
(150) |
3,589 |
|
443 |
- |
443 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
Services |
|
|
|
|
|
|
|
|
|
|
|
|
- Chief Corporate Services Officer |
1,345 |
- |
1,345 |
|
1,672 |
- |
1,672 |
|
327 |
- |
327 |
|
- Client Services & Public
Information |
8,216 |
(88) |
8,128 |
|
8,166 |
(15) |
8,151 |
|
(50) |
73 |
23 |
|
- Financial Services |
33,006 |
(2,101) |
30,905 |
|
34,010 |
(2,003) |
32,007 |
|
1,004 |
98 |
1,102 |
|
- Real Property Asset Management |
95,541 |
(10,814) |
84,727 |
|
94,594 |
(9,826) |
84,768 |
|
(947) |
988 |
41 |
|
- Legal Services |
4,573 |
- |
4,573 |
|
4,304 |
- |
4,304 |
|
(269) |
- |
(269) |
|
- Information Technology |
37,233 |
(218) |
37,015 |
|
41,031 |
(133) |
40,898 |
|
3,798 |
85 |
3,883 |
|
- City Clerk's Branch |
13,997 |
(3,078) |
10,919 |
|
13,327 |
(2,653) |
10,674 |
|
(670) |
425 |
(245) |
|
- Employee Services |
14,680 |
(37) |
14,643 |
|
15,666 |
(175) |
15,491 |
|
986 |
(138) |
848 |
|
Total |
208,591 |
(16,336) |
192,255 |
|
212,770 |
(14,805) |
197,965 |
|
4,179 |
1,531 |
5,710 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Planning
& Growth Management |
|
|
|
|
|
|
|
|
|
|
|
|
- Deputy City Manager |
597 |
- |
597 |
|
664 |
- |
664 |
|
67 |
- |
67 |
|
- Building Services |
11,778 |
(21,123) |
(9,345) |
|
10,723 |
(19,878) |
(9,155) |
|
(1,055) |
1,245 |
190 |
|
- Planning & Infrastructure Approvals |
9,602 |
(6,146) |
3,456 |
|
9,690 |
(5,750) |
3,940 |
|
88 |
396 |
484 |
|
- Plan., Environ. &
Infrastructure Policy |
6,401 |
(10) |
6,391 |
|
7,063 |
(92) |
6,971 |
|
662 |
(82) |
580 |
|
- Economic Develop. & Strategic Projects |
3,814 |
(794) |
3,020 |
|
3,811 |
(703) |
3,108 |
|
(3) |
91 |
88 |
|
Total |
32,192 |
(28,073) |
4,119 |
|
31,951 |
(26,423) |
5,528 |
|
(241) |
1,650 |
1,409 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Committee of
Adjustment |
692 |
(847) |
(155) |
|
896 |
(896) |
- |
|
204 |
(49) |
155 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conservation
Authorities |
5,163 |
- |
5,163 |
|
5,283 |
- |
5,283 |
|
120 |
- |
120 |
|
|
|
|
|
|
|
|
|
|
|
|
|
2005 Operating
Budget Corporate Summary Year
End Actual vs Budget by
Expenditures/Revenues
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
Surplus / (Deficit) |
||
|
|
2005
Actual |
|
2005 Budget |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exp |
Revenue |
Net |
|
Exp |
Revenue |
Net |
|
Gross |
Revenue |
Net |
|
|
$000 |
$000 |
$000 |
|
$000 |
$000 |
$000 |
|
$000 |
$000 |
$000 |
|
Community
& Protective Services |
|
|
|
|
|
|
|
|
|
|
|
|
- Deputy City Manager |
1,987 |
- |
1,987 |
|
2,317 |
- |
2,317 |
|
330 |
- |
330 |
|
- Paramedic Service |
43,257 |
(18,089) |
25,168 |
|
43,792 |
(17,635) |
26,157 |
|
535 |
454 |
989 |
|
- By-law Services |
12,901 |
(17,740) |
(4,839) |
|
12,114 |
(17,386) |
(5,272) |
|
(787) |
354 |
(433) |
|
- Emergency Measures Unit |
2,664 |
(1,380) |
1,284 |
|
1,742 |
(97) |
1,645 |
|
(922) |
1,283 |
361 |
|
- Fire Services |
99,019 |
(915) |
98,104 |
|
99,059 |
(509) |
98,550 |
|
40 |
406 |
446 |
|
- Housing |
117,878 |
(50,169) |
67,709 |
|
117,686 |
(50,132) |
67,554 |
|
(192) |
37 |
(155) |
|
- Parks & Recreation |
123,481 |
(98,576) |
24,905 |
|
119,170 |
(93,950) |
25,220 |
|
(4,311) |
4,626 |
315 |
|
- Public Health |
36,362 |
(23,853) |
12,509 |
|
36,898 |
(24,283) |
12,615 |
|
536 |
(430) |
106 |
|
- Employment & Financial Assistance |
256,500 |
(152,077) |
104,423 |
|
257,588 |
(153,045) |
104,543 |
|
1,088 |
(968) |
120 |
|
- Cultural Services & Community Funding |
31,527 |
(3,015) |
28,512 |
|
30,723 |
(2,673) |
28,050 |
|
(804) |
342 |
(462) |
|
- Long Term Care |
41,181 |
(35,252) |
5,929 |
|
39,800 |
(33,867) |
5,933 |
|
(1,381) |
1,385 |
4 |
|
Total |
766,757 |
(401,066) |
365,691 |
|
760,889 |
(393,577) |
367,312 |
|
(5,868) |
7,489 |
1,621 |
|
Ottawa Public
Library |
31,522 |
(3,693) |
27,829 |
|
26,333 |
(3,215) |
23,118 |
|
(5,189) |
478 |
(4,711) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ottawa Police
Services |
172,280 |
(8,100) |
164,180 |
|
172,321 |
(7,785) |
164,536 |
|
41 |
315 |
356 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Public Works & Services |
|
|
|
|
|
|
|
|
|
|
|
|
- Deputy City Manager |
6,245 |
(162) |
6,083 |
|
7,540 |
- |
7,540 |
|
1,295 |
162 |
1,457 |
|
- Infrastructure Services |
10,478 |
(3,506) |
6,972 |
|
9,975 |
(2,836) |
7,139 |
|
(503) |
670 |
167 |
|
- Surface Operations |
105,079 |
(1,135) |
103,944 |
|
94,982 |
(1,650) |
93,332 |
|
(10,097) |
(515) |
(10,612) |
|
- Traffic & Parking Operations |
29,405 |
(16,539) |
12,866 |
|
30,257 |
(15,955) |
14,302 |
|
852 |
584 |
1,436 |
|
- Transit Services |
243,765 |
(118,325) |
125,440 |
|
239,715 |
(116,869) |
122,846 |
|
(4,050) |
1,456 |
(2,594) |
|
- Fleet Services (Expenditures) |
153,231 |
- |
153,231 |
|
142,505 |
- |
142,505 |
|
(10,726) |
- |
(10,726) |
|
- Fleet Services (Recoveries / Revenues) |
(152,903) |
(439) |
(153,342) |
|
(142,101) |
(404) |
(142,505) |
|
10,802 |
35 |
10,837 |
|
- Solid Waste |
38,567 |
(15,530) |
23,037 |
|
37,744 |
(11,493) |
26,251 |
|
(823) |
4,037 |
3,214 |
|
- Drinking Water |
33,237 |
(1,830) |
31,407 |
|
35,018 |
(1,919) |
33,099 |
|
1,781 |
(89) |
1,692 |
|
- Wastewater Services |
32,638 |
(3,185) |
29,453 |
|
34,972 |
(3,105) |
31,867 |
|
2,334 |
80 |
2,414 |
|
Total |
499,742 |
(160,651) |
339,091 |
|
490,607 |
(154,231) |
336,376 |
|
(9,135) |
6,420 |
(2,715) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Departmental |
1,729,616 |
(618,919) |
1,110,697 |
|
1,714,821 |
(601,082) |
1,113,739 |
|
(14,795) |
17,837 |
3,042 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2005 Operating Budget Corporate Summary |
|||||||||||
|
Year End - Actual vs
Budget by Expenditures/Revenues |
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Surplus / (Deficit) |
||
|
|
2005 Actual |
|
2005 Budget |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exp |
Revenue |
Net |
|
Exp |
Revenue |
Net |
|
Gross |
Revenue |
Net |
|
|
$000 |
$000 |
$000 |
|
$000 |
$000 |
$000 |
|
$000 |
$000 |
$000 |
|
Non-Departmental |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
Benefit Provisions |
19,834 |
(5,334) |
14,500 |
|
17,076 |
(4,905) |
12,171 |
|
(2,758) |
429 |
(2,329) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
Formation Costs |
|
|
|
|
|
|
|
|
|
|
|
|
Contribution to Capital
Reserves |
130,072 |
- |
130,072 |
|
130,072 |
- |
130,072 |
|
- |
- |
- |
|
Debt Charges |
89,171 |
- |
89,171 |
|
91,197 |
- |
91,197 |
|
2,026 |
- |
2,026 |
|
Sale of Former
Ottawa City Hall - Reserves |
- |
(8,437) |
(8,437) |
|
- |
(8,437) |
(8,437) |
|
- |
- |
- |
|
Sale of Surplus
Land |
2,885 |
(2,885) |
- |
|
- |
- |
- |
|
(2,885) |
2,885 |
- |
|
Ray Friel Reserve |
388 |
(387) |
1 |
|
- |
- |
- |
|
(388) |
387 |
(1) |
|
Development
Charges |
- |
(717) |
(717) |
|
- |
(461) |
(461) |
|
- |
256 |
256 |
|
Provincial
Revenues - Long Term Care per diem |
- |
(1,147) |
(1,147) |
|
- |
(816) |
(816) |
|
- |
331 |
331 |
|
Sinking Fund
Surplus |
- |
(6) |
(6) |
|
- |
(900) |
(900) |
|
- |
(894) |
(894) |
|
100 Constellation
Lease |
6,814 |
(2,074) |
4,740 |
|
7,001 |
(2,424) |
4,577 |
|
187 |
(350) |
(163) |
|
Miscellaneous |
- |
(75) |
(75) |
|
- |
- |
- |
|
- |
75 |
75 |
|
|
229,330 |
(15,728) |
213,602 |
|
228,270 |
(13,038) |
215,232 |
|
(1,060) |
2,690 |
1,630 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
Common Expenditures |
|
|
|
|
|
|
|
|
|
|
|
|
Contribution to
Municipal Election Reserve |
850 |
- |
850 |
|
850 |
- |
850 |
|
- |
- |
- |
|
Self Insurance |
8,594 |
(4,102) |
4,492 |
|
5,492 |
(1,000) |
4,492 |
|
(3,102) |
3,102 |
- |
|
Corporate
Efficiency Savings / Sponsorship |
- |
- |
- |
|
(2,524) |
(1,500) |
(4,024) |
|
(2,524) |
(1,500) |
(4,024) |
|
Financial Charges
|
3,132 |
- |
3,132 |
|
4,520 |
- |
4,520 |
|
1,388 |
- |
1,388 |
|
|
12,576 |
(4,102) |
8,474 |
|
8,338 |
(2,500) |
5,838 |
|
(4,238) |
1,602 |
(2,636) |
|
2005 Operating Budget Corporate Summary Year End Actual vs Budget by Expenditures/Revenue |
|||||||||||
|
|
|
|
|
|
|
|
|
|
Surplus / (Deficit) |
||
|
|
2005 Actual |
|
2005 Budget |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exp |
Revenue |
Net |
|
Exp |
Revenue |
Net |
|
Gross |
Revenue |
Net |
|
|
$000 |
$000 |
$000 |
|
$000 |
$000 |
$000 |
|
$000
|
$000 |
$000 |
|
Corporate
Common Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
Water Billing
Revenues |
- |
(62,583) |
(62,583) |
|
- |
(63,746) |
(63,746) |
|
- |
(1,163) |
(1,163) |
|
Fire Supply Charges |
- |
(11,613) |
(11,613) |
|
- |
(11,368) |
(11,368) |
|
- |
245 |
245 |
|
Sewer Surcharge
Revenues |
- |
(99,366) |
(99,366) |
|
- |
(103,830) |
(103,830) |
|
- |
(4,464) |
(4,464) |
|
Penalty &
Interest |
- |
(9,204) |
(9,204) |
|
- |
(10,339) |
(10,339) |
|
- |
(1,135) |
(1,135) |
|
Investment Income |
- |
(21,918) |
(21,918) |
|
- |
(25,090) |
(25,090) |
|
- |
(3,172) |
(3,172) |
|
Hydro Ottawa
Dividend |
- |
- |
- |
|
- |
(12,000) |
(12,000) |
|
- |
(12,000) |
(12,000) |
|
Community
Reinvestment Fund (CRF) |
1,455 |
(3,160) |
(1,705) |
|
- |
(1,700) |
(1,700) |
|
(1,455) |
1,460 |
5 |
|
Provincial
Offences Act |
- |
(8,800) |
(8,800) |
|
- |
(11,699) |
(11,699) |
|
- |
(2,899) |
(2,899) |
|
Rideau Carleton
Raceway |
- |
(3,330) |
(3,330) |
|
- |
(3,000) |
(3,000) |
|
- |
330 |
330 |
|
Lottery Fees |
- |
(1,208) |
(1,208) |
|
- |
(1,210) |
(1,210) |
|
- |
(2) |
(2) |
|
Tax
Certificate/New Account Fees |
- |
(2,165) |
(2,165) |
|
- |
(2,983) |
(2,983) |
|
- |
(818) |
(818) |
|
Other Miscellaneous
Revenues |
138 |
(3,125) |
(2,987) |
|
- |
(5,618) |
(5,618) |
|
(138) |
(2,493) |
(2,631) |
|
|
1,593 |
(226,472) |
(224,879) |
|
- |
(252,583) |
(252,583) |
|
(1,593) |
(26,111) |
(27,704) |
|
Taxation
Related Revenues & Expenditures |
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
Assessment |
- |
(23,441) |
(23,441) |
|
- |
(16,717) |
(16,717) |
|
- |
6,724 |
6,724 |
|
Payments in lieu
of taxation |
- |
(176,016) |
(176,016) |
|
- |
(176,554) |
(176,554) |
|
- |
(538) |
(538) |
|
Public
Institutions |
- |
(4,678) |
(4,678) |
|
- |
(4,490) |
(4,490) |
|
- |
188 |
188 |
|
Local Improvement
Revenue |
- |
(1,202) |
(1,202) |
|
- |
(2,000) |
(2,000) |
|
- |
(798) |
(798) |
|
Tax Rebates &
Remissions |
14,475 |
- |
14,475 |
|
15,542 |
- |
15,542 |
|
1,067 |
- |
1,067 |
|
Municipal
Property Assessment Corp. |
9,609 |
- |
9,609 |
|
9,595 |
- |
9,595 |
|
(14) |
- |
(14) |
|
|
24,084 |
(205,337) |
(181,253) |
|
25,137 |
(199,761) |
(174,624) |
|
1,053 |
5,576 |
6,629 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Non
Departmental |
287,417 |
(456,973) |
(39,484) |
|
278,821 |
(472,787) |
(63,894) |
|
(8,596) |
(15,814) |
(24,410) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
Tax Bill |
|
|
|
|
|
|
|
|
|
|
|
|
Property Tax
Revenues |
- |
(920,201) |
(920,201) |
|
- |
(919,773) |
(919,773) |
|
- |
428 |
428 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Operating Budget - City of Ottawa |
2,017,033 |
(1,996,093) |
20,940 |
|
1,993,642 |
(1,993,642) |
- |
|
(23,391) |
2,451 |
(20,940) |
ANNEX
B: Variance Analysis - 2005 Operating
Results
DEPARTMENTAL
A variance analysis has been provided for only
those departmental areas under the control of the administration, therefore,
they do not include the Elected Official and Office of the Auditor General
results. In addition, an explanation is
provided for results that show a net variance of over $500,000 or more than 5%
of the gross budgeted expenditures or revenues.
CITY MANAGER
The 2005 surplus for the City
Manager’s Office was due to unspent compensation and purchased services costs
as a result of the expenditure and hiring freezes, gapping, and delays in the
implementation of some programming in performance measurement and reporting
initiatives.
CORPORATE SERVICES
The 2005 surplus for the Corporate
Services Department, in the amount of $5,710,000 is primarily due to unspent
compensation and programming costs as a result of the expenditure and hiring
freezes, gapping, and delays in the implementation of some programming such as
Management Investment Strategy (MIS) initiatives, and Health and Safety
operational review. These freezes caused a reduction in completed work such as
IT projects and MIS initiatives. Deficits in the Department included cost
over-runs in Legal Services for contracted outside services, and translation
and interpretation costs in the French Language Services program of City Clerk
Services.
With the
implementation of the Building Code Statute Law Amendment Act and Ontario
Regulation 305/03 that came into effect on July 1, 2005, the Building Services
Branch can only recover from building permits fees, the costs associated with
servicing the building permits and enforcing the Ontario Building Code Act and
the Code. The $190,000 surplus within
the Building Services Branch is directly attributable to unspent compensation
due to vacancies in the first half of 2005.
The surplus created in the second half of 2005 has been directed to the
reserve funds created as a result of the implementation of the new legislation
resulting in a zero balance.
The $484,000
surplus within the Planning & Infrastructure Branch is directly
attributable to higher than expected revenues and unspent compensation due to
vacant positions, which was partially offset by additional expenditures for
advertising services and materials and supplies.
The $580,000
surplus within the Planning Environment & Infrastructure Policy Branch is
directly attributable to unspent compensation due to vacant positions and
savings in the purchase of services budget.
The 2005 spending freeze delayed the staffing of positions within the
new Environmental Sustainability Division.
Other
departmental variances relate primarily to compensation savings associated with
positions being vacant during all or parts of the year.
COMMUNITY AND PROTECTIVE SERVICES
The surplus of $330,000 in the Deputy City Manager’s Office arises from office operations and stems primarily from vacancies in the Strategic Initiatives & Business Planning Division and the discretionary spending freeze.
The Paramedic Service surplus of $989,000 is attributable to cost savings in compensation and purchased services cost as well as increased revenues. In 2005, the approved budget increased the number of paramedics by 20 to be hired July 1st. Delays in hiring new paramedics resulted in savings on salaries, which were partially offset by overspending on overtime. Some savings in material and services budgets result from the discretionary spending freeze but for the most part arose from savings in patient transfer fees billed to the City by other municipalities. These billings fluctuate from year to year and depend on call volumes and ambulance availability. The increase in revenue includes an inflationary increase in funding levels from the province and increased fees from stand by charges for special events.
The By-Law deficit of $433,000 resulted from
increased compensation costs for the implementation of a new deployment plan
and one time reclassification costs.
The 2006 approved budget included an increase for a new deployment
plan. An increase in licensing revenues
helped to offset the increased costs.
The Emergency Management Office (EMO) over
expenditure and increased revenue are the result of the Kashechewan evacuation.
The entire federal government subsidy for this effort has been recorded in the
EMO, as have most of the direct costs associated with the relief effort. Administrative costs eligible for subsidy
was not centralized in EMO, which results in the EMO surplus of $361,000.
The Fire Services
surplus of $446,000 is entirely due to increased revenues. The increase results from additional burns
permits, Ministry of Transit Ontario claims, HAZMAT fees and stand-by charges
for special events.
The Parks and Recreation Branch includes childcare
and, as is the case in with provincially mandated programs, can be subject to
legislative changes and/or funding level changes throughout the year. In 2005, the provincial Ministry of Children
and Youth Services announced increases in childcare spaces and capital funding. The variances in expenditures and revenues
reflect the announced increases. The
2006 Budget has been accordingly adjusted.
The surplus of $315,000, or 1% of the budgeted net expenditures, results
from Parks and Recreation adjusting recreation programs and costs based on
community requirements and revenues running slightly higher than budgeted.
Public Health programs are cost shared with the
Province and any expenditure savings are shared with the Ministry of Health and
Long Term Care. The savings in
expenditures were due to the discretionary spending freeze and from vacancies
resulting from the difficulty and delays in hiring public health nurses and
food inspectors.
Employment and Financial Assistance (EFA)
programs are provincially mandated and are constantly shifting in reaction to
changes in legislation and caseload levels. While changes during the year
create large dollar variances in expenditures and revenues, these variances are
small in comparison with the overall budget and any significant impacts to City
funding levels are communicated to Committee and Council throughout the
year. In 2005, expenditures exceeded
the budget mainly as a result of the increased caseload and drug costs of the
Ontario Disability Support Program Financial Assistance (delivered by the
Province and cost shared by the Municipality).
Provincial revenue is increased to reflect the effective leveraging of
employment subsidies in employment programs.
The variances resulted in a surplus to the City of $120,000 or 0.1% of
the EFA budgeted net spending.
Centrepointe Theatre and museum services were
the primary contributors to the deficit of $462,000 in the Cultural Services
and Community Funding Branch. The
increased cost was partially mitigated by increased revenues arising from
increased program registration, admission fees, grants and hall rentals. The
2006 approved budget included increases for both Centrepointe Theatre and
museums.
The Long Term Care Branch had no variance on a net spending
basis. The expenditures exceeded budget
increased revenues of $1,385,000.
Increased food prices, the costs associated with the opening of the
Garry J Armstrong Centre, harmonization of policy manuals across the four homes
and increased resident care requirements all contributed to the increased
expenditures. The Ministry of Health
and Long Term Care provides annual funding based on the care requirements of
the residents, which offset the increased cost. The Ministry also provided one-time funding to pay the increased
costs associated with the Armstrong Centre and annual inflationary adjustments
to other funding envelopes, which offset the remaining increase in
expenditures. The approved 2006 budget
was adjusted to reflect the increased spending and funding levels.
OTTAWA PUBLIC LIBRARY
The
deficit of $4,711,000 results from one-time retroactive pay for job evaluation
($1,500,000) and an estimate of retroactive payments associated with pay equity
($3,400,000). The 2006 approved budget
included a base budget increase for job evaluation cost increases. The base adjustment required for pay equity
will also be incorporated into the 2007 budget. Revenues helped offset some of the increase and are attributed to
a one-time federal grant and increased fine revenues.
OTTAWA POLICE
SERVICES
The
Police Service ended the 2005 fiscal year with a budget surplus of
$356,000. Four factors contributed to
the surplus: fewer than expected retirements ($1.4 million), a discretionary
spending freeze on program supplies and services ($0.6 million), a number of
revenue variances ($0.5 million) and a favourable arbitration regarding court
overtime combined with increased controls in that area ($0.3 million). These positive results more than offset cost
pressures in the areas of overtime ($2.3 million) and fuel ($0.2 million), creating
a budget surplus of $365,000.
The surplus for the Deputy City Manager’s office of $1.4 million was
primarily attributable to staff vacancies and savings in the purchase of
services budget. The hiring freeze for
the second half of 2005, accentuated the surplus.
The 2005 surplus
for the Infrastructure Services Branch in the amount of $167,000 is mainly
attributable to staff vacancies. The
Branch also experience higher than expected revenues, which were slightly
offset with higher expenditures to provide the services related to those
revenues.
The Surface
Operations Branch deficit of $10.6 million is primarily a result of increased
costs in the Winter Maintenance Program in the amount of $7.75 million. This past winter season, particularly during
December 2004 and January 2005, Ottawa experienced a combination of weather
patterns including multiple and prolonged precipitation events ranging from
snow, freezing rain and rain on snow, accompanied by drastic changes in air
temperatures, all of which challenged the Department’s ability to achieve
adequate sidewalk and roadway conditions in a timely manner. On January 19, 2005, Transportation
Committee granted the Director of Surface Operations the discretionary
authority necessary to undertake operational interventions, as required, to
re-establish satisfactory road and sidewalk conditions and directed the
Department to report back concerning the costs and effectiveness of these
measures. The Branch submitted a report
in July of 2005 on Winter Operations Update and reported that the cost of
supplementary measures undertaken to restore roadways and sidewalks to safe
conditions was $3.36 million beyond current budget provisions. The City, on December 16, 2005, experienced
another major event resulting in major storm response and major snow removal,
and clean up operations resulting in additional costs in the order of $4.03
million being incurred beyond budget provisions contributing to the final
year-end position in Winter Control operations. Also impacting all Surface Operations programs areas of Roadways,
Winter Control, Parks and Forestry operations were increased expenditures
resulting from fuel pricing, historical fleet funding shortfalls and inflation
on repairs of fleet assets through the utilization of vehicle and equipment in
those operations.
Within the Traffic and
Parking Operations Branch, a surplus of $1.4 million was achieved, comprised of
$583,000 revenue and $852,000 expenditures.
Parking revenues in the On-Street program ended the year with a deficit
of $809,000 and in Off-Street program a surplus of $476,000. The Off-Street program surplus included
one-time revenue of $441,000 from the 31 Gloucester parking lot, which had
originally been anticipated to close in March, but did not close until
mid-December. Revenue surpluses from encroachment permits in the By-laws &
Permits Division amounted to $510,000.
The Traffic Operations Division also achieved surplus revenue of
$349,000 beyond budget from accident damage recovery claims. The extent of these claims varies
annually. A one-time street lighting
damage claim of $121,000 occurred prior to the P3 contract. Expenditure
surpluses of $852,000 were also realized primarily due to staffing vacancies as
a result of the hiring freeze, and discretionary spending reductions.
The 2005 deficit in Transit Services was $2.6 million. This was primarily attributable to $6.3 million in fleet expenditures beyond budget due to increased costs for diesel fuel and bus parts and $495,000 in material costs as well as $218,000 in purchased services. This deficit was partially mitigated by a compensation surplus of $3.1 million and a passenger revenue surplus of $1.5 million. All major variances have been addressed in the 2006 approved budget.
Within Solid Waste Services, City growth led to
increased tonnages of waste and higher collection and processing contract costs
of approximately $370,000. These
pressures were addressed in the 2006 Operating Budget with increases of $2.6
million for inflation and the implementation of the new collection contracts,
and $1.95 million for growth. Fleet
maintenance and fuel costs also surpassed budget by approximately $260,000. Waste Diversion Organization revenues exceeded
budget by $1.8 million and very favorable recyclable markets generated
additional revenues of $2.2 million.
Within Drinking
Water Services, staff vacancies in 2005 resulted in savings in Compensation
costs of $812,000. Furthermore,
deferred maintenance, lower than anticipated production levels and the delay of
the Well Maintenance Program resulted in various savings in purchased services
and materials of $960,000.
Within Wastewater
and Drainage Services, savings of $2.7 million in Purchased Services, Materials
and Fixed Assets were mainly due to a combination of lack of staffing resources
to manage sewer maintenance contracts, discretionary spending reductions, and
lower than anticipated consumption of hydro and chemicals. The staffing shortage has been addressed in
the 2006 Operating Budget with the addition of 11 new FTE’s in Wastewater
Collection.
NON-DEPARTMENTAL
Corporate Benefit Provisions
The deficit of $2.3 million is as
a result of a CUPE grievance award on the accumulation of vacation and sick
leave while on Long Term Disability.
Corporate Efficiency Savings
As reported to Council during the 2006
Budget deliberations, the 2005 Corporate Efficiency Savings target was not
achieved. The original budget of $8.9
million was achieved except for $4.024 million. This unachieved savings target
has been brought forward as part of the 2006 target.
Water and Sewer Rates
A review of the 2005 results determined
that the budget provisions for these rates was overstated and the 2006 Budget
has been adjusted.
Penalty and
Interest on Taxes
Accurately
predicting the budget for penalty and interest earned on taxes not paid on time
has been a challenge since amalgamation.
The City has never achieved the revenue budget established since 2001
and has reduced the budget every year, including 2004. The actual revenue received in 2005
increased over 2004 although it fell short of the budgeted figure by
$1,135,000. It is expected that
revenues will increase again in 2006 and therefore a budget adjustment has not
been made.
Investment Income
There was a $3,172,000 shortfall in investment income in 2005. The 2005 budget was based, in part, on an
increase in short-term interest rates.
Interest rates did not increase significantly until the last quarter of
2005. The City’s investments that are
attributable to its operating funds have been declining over the past few
years. This is the result of the
spending of previous years’ unspent capital financing.
Hydro Ottawa Dividend
In late 2004, Hydro Ottawa approved a dividend policy that would pay out 60% of their net income as a dividend to the City. This dividend was estimated to be $12 million and was provided for in the 2005 Operating Budget. Hydro Ottawa did not declare this dividend until April 2006. Accounting rules require that dividend revenue be recorded in the year declared, not the year in which the net income is earned.
Provincial
Offences Act
Provincial Offences Act revenues increased in
2005 by $647,000 over 2004 but are still not achieving the revenue budget
amount of $11.699 million, leaving an unachieved amount of $2.899 million. The 2006 Budget has not been adjusted as the
revenues are expected to increase in 2006.