5. SINKING FUND LEVIES

taxes aux fins du fONDS D'AMORTISSEMENT

COMMITTEE RECOMMENDATION

That Council receive this report for information.

RECOMMANDATION DU COMITÉ

Que le Conseil prenne connaissance du présent rapport.

DOCUMENTATION

1. City Treasurer’s report dated 4 January 2012 (ACS2012-CMR-FIN-0002).

2. Extract of Finance and Economic Development Committee Minutes dated 12 January 2012.

Report to/Rapport au :

Finance and Economic Development Committee

Comité des finances et du développement économique

and Council / et au Conseil

4 January 2012 / le 4 janvier 2012

Submitted by / Soumis par : Marian Simulik, City Treasurer/Trésorière municipale

Contact Person/Personne ressource : Mona Monkman, Deputy Treasurer Corporate Finance / Trésorier Municipal Adjointe Finances Municipales

Finance Department/Service des finances

613-580-2424 ext./poste 41723, Mona.Monkman@ottawa.ca

City Wide/à l’échelle de la Ville

Ref N°: ACS2012-CMR-FIN-0002

SUBJECT:

SINKING FUND LEVIES

OBJET :

taxes aux fins du fONDS D'AMORTISSEMENT

REPORT RECOMMENDATION

That Finance and Economic Development Committee and Council receive this report for information.

Recommandation du rapport

Que le Comité des finances et du développement économique et le Conseil prennent connaissance du présent rapport.

BACKGROUND

When the City issues sinking fund debentures, annual contributions are made to the Sinking Fund, which together with interest earnings derived from the investment of these funds, accumulate to an amount that will be sufficient to pay the debentures on maturity.

In accordance with subsection 424(4) of the Municipal Act, 2001 the City Treasurer is required to prepare and submit to Council in each year, a statement showing the sums that Council will be required, by by-law, to raise for sinking funds in that year.

A second report on the sinking fund earnings for the year, including the balance of each sinking fund account, is provided to Council annually once the accounts have been closed and the financial statements for the sinking fund have been prepared and audited.

DISCUSSION

The following is a statement of the sinking fund requirements for 2012:

Debenture By-law	Sinking Fund Amounts
	$
81-1992	3,975,229
68-1998	1,036,501
72-1999	3,210,575
2011-254	2,755,860
	10,978,165

In accordance with provisions of the debenture by-laws, the sinking fund amounts will be levied as follows:

Purposes	Sinking Fund Amounts
	$
Tax Supported	7,999,118
Rate Supported	1,740,823
Development Charges	1,238,224
	10,978,165

During 2011 the sinking fund debentures authorized under By-law 33-1991 matured on February 28, 2011 and $100 million was transferred from the Sinking Fund to the City to meet the debenture commitment on its maturity. Accordingly the sinking fund levy of $1,000,000 associated with By-law 33-1991 is no longer required.

On July 14, 2012 a sinking fund levy will commence in the amount of $2,755,860 which was authorized by By-law 2011-254. The debentures authorized by By-law 2011-254 were issued on July 14, 2011 in the amount of $150 million and will mature on July 14, 2042.

This statement is submitted for Council for its information in accordance with existing legislation.

RURAL IMPLICATIONS

There are no rural implications.

CONSULTATION

This is an administrative matter that does not require public consultation.

Comments by the Ward Councillor(s)

Not applicable.

LEGAL IMPLICATIONS

There are no legal impediments to receiving this report. Subsection 424(4) requires the Treasurer to provide an annual statement showing the sums that Council is required by law to raise for sinking funds for that year. Legal has been advised that the annual contributions to the sinking funds for 2012 have been included in the approved tax budget for 2012 and the levies will be provided in the rate budget, which Council will consider in the first part of the year.

RISK MANAGEMENT IMPLICATIONS

There are no risk implications associated with this report.

FINANCIAL IMPLICATIONS

Debt charge budgets for the City provide for the payment of sinking fund levies. Since the payment of these levies has been approved by by-laws, future debt charge budgets will include budget provisions sufficient to cover these levies.

Accessibility Impacts

Not applicable.

Environmental Implications

There are no environmental implications associated with this report.

Technology Implications

There are no technological implications associated with this report.

City Strategic Plan

Not applicable.

SUPPORTING DOCUMENTATION

None.

DISPOSITION

Following consideration by Finance and Economic Development Committee, this report will be forwarded to Council for its information.