HomeMy WebLinkAboutFCS-16-081 - 2016 April Variance Report
RE
PORT TO: Finance and Corporate Services Committee
DATE OF MEETING: June 13, 2016
SUBMITTED BY: Ryan Hagey, Director of Financial Planning
519-741-2200 Ext 7353
PREPARED BY: Debra Fagerdahl, Manager of Financial Planning
519-741-2200 Ext 7114
WARD(S) INVOLVED: All
DATE OF REPORT: June 1, 2016
REPORT NO.: FCS-16-081
SUBJECT: 2016 April Variance Report
________________________________________________________________
RECOMMENDATION:
For Information
BACKGROUND:
Staff prepares a variance report three times per year reflecting
August and December. This is the first report to Council regardi
performance versus the 2016 budget as at the end of April.
The report and attached schedules include information regarding:
tax supported services
·
rate supported enterprises/utilities, and
·
supplementary information related to investment income
·
Variances in an organizations in-year financial results are nor
exactly reflect budgeted expectations. Because of this, the City
reserves which have minimum/maximum targets based on the variabi
associated activities.
**
* This information is available in accessible formats upon reque
Please call 519-741-2345 or TTY 1-866-969-9994 for assistance.
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RE
PORT:
Overall staff is projecting that the Citys tax supported result
The major contributors to an overall small net positive variance
payment in lieu (PIL) properties and the expected surplus in inv
areas of concern in the enterprises are the sanitary/sewer utili
which experienced large year-to-date deficits.
Significant projected tax supported variances (over $200,000) ar
Additional details are provided in Schedule 1 for variances that
of budget.
Operating Fund Tax Base (Schedule 1)
St
aff are currently projecting a modest surplus of $458,000 in tax
2016. The surplus equates to a 0.27% variance from the operating
$169M.
Significant Projected Variances (over $200,000)
General Revenue:
Tax Payment in Lieu (PIL) is projecting a surplus of $245,000 r
·
PIL properties.
Investment income is projecting a surplus of $325,000. The Cana
·
and the labour market have outperformed expectations resulting i
investment rates than originally forecast by analysts.
Building Enterprise (Schedule 2)
Variance
($000's) Actual BudgetFavourable/
(Unfavourable)
Th
e Building Enterprise has a surplus of $193,000 which is $393,00
This improvement is largely due to higher than expected revenues
except for high rise apartments.
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Golf Courses (Schedule 3)
Variance
($000's) Actual Budget Favourable/
(Unfavourable)
Th
e Golf Enterprise has a surplus of $92,000 which is $25,000 bett
due to increased revenues made possible by the earlier openings
promotions in April.
Parking Enterprise (Schedule 4)
Variance
($000's) Actual Budget Favourable/
(Unfavourable)
Th
e Parking Enterprise is ahead of target with a surplus of $606,0
better than the budgeted surplus. Revenues are higher due to in
parking facilities. Also contributing to the surplus is lower ex
removal this winter.
Water Utility (Schedule 5)
Variance
($000's) Actual BudgetFavourable/
(Unfavourable)
The Water Utility has a deficit of $402,000, which is 156,000 bett
The largest contributing factor is the lower than expected water
expenses as a result of fewer water main breaks this winter. Rev
anticipated due to reduced consumption, but this was offset by r
from the Region of Waterloo.
Sanitary Sewer Utility (Schedule 6)
Variance
($000's) Actual Budget Favourable/
(Unfavourable)
Th
e Sanitary Sewer Utility has a deficit of $1.56M causing an unfa
$826,000. Actual sewer surcharge revenues were lower than budget
with decreased water consumption in the water utility. There was
in the cost of sewage processing as these costs were higher than
than average spring resulting in treatment costs for water enter
through inflow and infiltration.
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St
orm Sewer Utility (Schedule 7)
Variance
($000's) Actual BudgetFavourable/
(Unfavourable)
The Storm Sewer Utility has a surplus of $379,000 which is on budg
unfavourable variance of $46,000. Both revenues and expenses ar
budget.
Gas Utility (Schedule 8)
Variance
($000's) Actual BudgetFavourable/
(Unfavourable)
Ga
s Utility - Overall the Gas Utility has a surplus of $2.0M. Reve
were under budget due to less than anticipated consumption as a
gentler winter.
Gas Delivery has a surplus of $2.9M as at March 2016 which resul
unfavourable variance. The milder winter was a major contributin
than budgeted revenue as a result of lower consumption. This was
in budgeted expenses due to unfilled vacancies.
Gas Supply has a deficit of $483,000 resulting in a $3.0M favour
revenues from lower than expected gas sales were more than offse
expected price of the gas commodity.
Gas Transportation has a surplus of $830,000 and was less than t
resulting in a negative variance of $316,000. The negative varia
revenues was offset somewhat by reduced gas transportation purch
Based on the current rates, surpluses and deficits, there is an
or shortfall of stabilization reserve requirements will be addre
change (November 2016).
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Investment Report (Schedule 9)
All investments made were in accordance with the Citys investme
investment yields to date have averaged 1.44%, and average short t
balances remain high. A surplus is projected due to the higher t
result of the Canadian economy outperforming expectations leadin
unchanged while analysts had expected a reduction.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
The recommendation of this report supports the achievemen
strategic vision through the delivery of core service.
FINANCIAL IMPLICATIONS:
Financial implications are discussed above and detailed in the a
COMMUNITY ENGAGEMENT:
Inform This report has been posted publicly as part of the age
Dan Chapman, Deputy CAO (Finance and Corporate Services)
ACKNOWLEDGED BY:
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