3. CAPITAL
ADJUSTMENTS AND CLOSING OF PROJECTS – TAX SUPPORTED AJUSTEMENT DU
BUDGET DES IMMOBILISATIONS ET CESSATION DE PROJETS FINANCÉS PAR RECETTES
FISCALES |
That Council:
1.
Approve the budget adjustments as detailed in Document
1;
2.
Authorize the closing of capital projects listed
in Document 2, the funding of deficits as identified and the return of balance
of funds to funding sources;
3.
Permit those projects in Document 3 that qualify
for closure, to remain open; and
4.
Receive the budget adjustments in Document 4
undertaken in accordance with the Delegation of Authority By-law 2009-231, as
amended, as they pertain to capital works.
RecommandationS du ComitÉ
Que le Conseil:
1. approuve les ajustements budgétaires
décrits dans le document 1;
2. autorise la cessation des projets
d’immobilisation énumérés dans le document 2, le financement des déficits
indiqués et la remise des fonds restants aux sources de financement;
3. permette que, les projets mentionnés
dans le Document 3 qui se qualifient pour une cessation, restent ouverts;
4. prenne connaissance des ajustements
budgétaires décrits dans le document 4, apportés aux termes du Règlement
municipal 2009-231 sur la délégation de pouvoirs, modifié, et ayant trait aux
travaux d’immobilisation.
DOCUMENTATION
1. City Treasurer’s report dated 30 May
2011 (ACS2011-CMR-FIN-0031).
Finance and Economic Development Committee
Comité des finances et du développement économique
and Council / et au Conseil
30 May 2011 / le 30 mai 2011
Submitted by/Soumis par: Marian
Simulik, City Treasurer/Trésorière municipale
Contact
Person/Personne ressource: Tom Fedec,
Manager, Budget and Financial Planning, Finance / Gestionnaire, Planification
budgétaire et financière, Finances
(613)
580-2424 ext 21316, Tom.Fedec@ottawa.ca
SUBJECT:
|
CAPITAL
ADJUSTMENTS AND CLOSING OF PROJECTS – TAX SUPPORTED
|
|
|
OBJET :
|
AJUSTEMENT DU BUDGET DES IMMOBILISATIONS ET CESSATION
DE PROJETS FINANCÉS PAR RECETTES FISCALES |
That the Finance and Economic Development recommend
Council:
1.
Approve the budget adjustments as detailed in
Document 1;
2.
Authorize the closing of capital projects listed
in Document 2, the funding of deficits as identified and the return of balance
of funds to funding sources;
3.
Permit those projects in Document 3 that qualify
for closure, to remain open; and
4.
Receive the budget adjustments in Document 4
undertaken in accordance with the Delegation of Authority By-law 2009-231, as
amended, as they pertain to capital works.
Que le Comité des finances et du développement économique recommande
au Conseil :
1. d’approuver les ajustements
budgétaires décrits dans le document 1;
2. d’autoriser la cessation des projets
d’immobilisation énumérés dans le document 2, le financement des déficits
indiqués et la remise des fonds restants aux sources de financement;
3. de permettre que, les projets
mentionnés dans le Document 3 qui se qualifient pour une cessation, restent
ouverts;
4. de prendre connaissance des
ajustements budgétaires décrits dans le document 4, apportés aux termes du
Règlement municipal 2009-231 sur la délégation de pouvoirs, modifié, et ayant
trait aux travaux d’immobilisation.
Generally, budget adjustments to capital projects are required to:
· Adjust for increases or decreases in project costs;
· Consolidate similar accounts to facilitate issuing of contracts;
· Create separate accounts to facilitate project tracking;
· Account for the receipt of revenues not previously anticipated or for the over / underestimation of revenues; and
· Adjust project financing.
The Delegation of Authority By-law 2009-231, as amended, specifies those parameters in which budget adjustments may be made if authorized by the City Treasurer. Those capital budget adjustment requests that do not meet the delegated authority limits of the City Treasurer require the approval of City Council. Generally, Council authority is required for those capital budget adjustments involving:
· Transfers between programs or internal orders in excess of 10% or $100,000 whichever is the lesser;
· Transfers of debt authority between programs with previously approved debt authority, regardless of amount;
· Establishment of new projects outside the budget process;
· A reduction of or increase in funding authority; and
· Project closures.
This report includes those capital budget adjustments that require specific Council approval (Document 1) as well as those that have been made as a result of delegated authority provisions (Document 4). The latter is provided for the information of Council, while adjustments in the former document are being recommended for approval.
Capital project closures are also included in this report with details provided in Document 2. In closing these projects, surplus funds are first applied to those projects being closed that are in deficit and the remaining net surplus is returned to source.
With the revised governance structure as adopted by Council at the beginning of its term of office, a separate report on capital adjustments and closing of projects will be submitted to the Transit Commission which will reflects projects under their mandate.
As
indicated above, the detail of those capital budget adjustments that require
Council approval because they are not within the delegated authority limits of
the City Treasurer for the transfer of funds is provided in Document 1. An explanation for why each budget adjustment
is required, as provided by the submitting department, is also included.
Document
1 separates the budget adjustments requested by project managers from the
administrative adjustments. Unlike those
requested by departments, administrative adjustments do not have an impact on
scope or nature of work, nor do they involve transfers between projects. Generally, they revise financing of a project
and require Council approval because they either involve debt or exceed the
City Treasurer’s delegated authority limits.
All capital projects recommended for closure are listed in Document 2. Also provided is information related to the adjustments required that will return excess funds to source or fund project deficits. As part of this process, explanations are required from project managers for those projects recommended for closure that had deficits in excess of $100,000.
For those integrated projects that will be closed, the information provided includes both tax and rate funding. This is because both tax and rate sources of funding are affected if there is a deficit or surplus when these projects are closed. Although this report seeks Council approval for the tax-supported portion of these projects only, the impact on the rate is also shown for information purposes. Similarly, the “Capital Adjustments and Closing of Projects – Rate Supported” will report the same integrated projects, but only make recommendations related to the rate portion of the projects while the tax portion will be included for information.
Criteria for Closure
As directed by the Executive Committee (EC), capital projects will be considered for closure if the stated completion date is 2010 or prior.
Capital projects that qualify for closure, but are recommended to remain open based on the rationale provided by the project managers are listed in Document 3. Upon Council approval of this recommendation, the year of completion for these projects will be revised accordingly.
Those capital budget adjustments processed under the authority delegated to the City Treasurer (By-law 2009-231) April 2010 to April 2011 are provided in Document 4 for the information of Committee and Council. Included in this list are adjustments made to reflect the procurement savings that have been realized in support of the Management Efficiency target.
There are no rural implications.
The purpose of this report is administrative in nature and therefore no public consultation is required. All departments have been involved in its preparation.
There are no legal impediments to implementing the recommendations of this report.
RISK
MANAGEMENT IMPLICATIONS
There are no risk implications.
The impact of the budget adjustments recommended in Document 1 and the closing of capital projects recommended in Document 2 are summarized in the chart below.
|
Document 1 - Budget Adjustments Return to
Source/(Funding Required) |
Document 2 - Project Closures Return to
Source/(Funding Required) |
Total Return to Source/(Funding Required) |
Revenue |
(1,244,323) |
- |
(1,244,323) |
|
|
|
|
Tax Supported
Reserves |
|
|
|
City Wide |
372,851 |
6,230 |
379,081 |
Transit Capital |
490,000 |
2,839 |
492,839 |
Corporate Fleet |
(390,000) |
3,132 |
(386,868) |
Child Care |
(1,450,000) |
(1,329) |
(1,451,329) |
Library |
- |
96,117 |
96,117 |
Housing |
(540,250) |
985 |
(539,265) |
|
(1,517,399) |
107,976 |
(1,409,423) |
|
|
|
|
Other Non-Tax
Reserves |
|
|
|
Parking |
- |
385 |
385 |
CIL Parkland |
(119,000) |
(820,118) |
(939,118) |
Solid Waste Compensation |
(7,000,000) |
- |
(7,000,000) |
|
(7,119,000) |
(819,733) |
(7,938,733) |
|
|
|
|
Rate
Supported Reserves |
|
|
|
Water |
- |
1,263,408 |
1,263,408 |
Waste Water |
- |
2,999,121 |
2,999,121 |
Solid Waste |
(3,812,532) |
478,586 |
(3,333,946) |
|
(3,812,532) |
4,741,114 |
928,582 |
|
|
|
|
Development
Charges |
(1,588,813) |
1,383,082 |
(205,731) |
|
|
|
|
Debt |
|
|
|
City Wide |
(673,038) |
530,721 |
(142,317) |
Transit Debt |
(1,147,000) |
- |
(1,147,000) |
Solid Waste |
10,812,532 |
- |
10,812,532 |
Rate Supported |
- |
1,152,253 |
1,152,253 |
Gas Tax |
- |
1,005,851 |
1,005,851 |
Development Charges |
2,205,000 |
452 |
2,205,452 |
|
11,197,494 |
2,689,277 |
13,886,771 |
|
|
|
|
Grand Total |
(4,084,573) |
8,101,716 |
4,017,143 |
*Includes the Integrated
Roads, Water, & Sewer Program. |
|
A Reserve Fund
Status schedule is attached as Document 5, and provides an update to the tax
supported reserves and other capital related accounts. The schedule reflects and incorporates the
recommendations contained in this report.
TECHNOLOGY IMPLICATIONS
There are no technology implications with this report.
CITY STRATEGIC PLAN
There are no impacts on the City’s Strategic Plan.
Document 2 – Capital Projects Recommended for Closure
Document 3 – Capital Projects Requiring Council Approval to Remain Open
Document 4 – Budget Adjustments Processed Under Delegated Authority
Document 5 – Reserve Fund Status
DISPOSITION
Upon approval of the report, Financial Services will process the required adjustments.