Consolidated Funding Surplus/(Deficit) Review - Quarter 2 Financial Update (2016)

Water and Wastewater

Water and Wastewater Services surplus of $782,585 (0.99 per cent of budget) is due to a combination of savings from: personnel vacancies in wastewater operator and administrative roles, unsubscribed 2016 Combined Sewer Overflow (CSO) funding, a reduction/deferral of consulting services due to staff resources being fully utilized on other projects at this time with limited capacity for additional consulting assignments; and higher than anticipated budgeted water sales. Offsetting these savings are higher than budgeted utility costs due to increased rates.

It is recommended that the forecasted funding surplus of $782,585 for water and wastewater go to the water and wastewater stabilization reserves ($364,585) except for the CSO surplus that will go back to the Wastewater Capital Reserve ($418,000).

Operating Funding Surplus	$782,585
% of total budget	0.99%
% of rate revenue	0.72%

Water and Wastewater Consolidated Statement of Operations

Waste Management

Waste Management Services surplus of $2,235,157 (4.56 per cent of budget) is primarily due an increase in the Waste Diversion Ontario funding received for the Blue Box Program; lower than anticipated number of organic tonnes being delivered to Walker Industries; a reduction in the volume of recyclables purchased and processed from Waterloo; to the annual collection contract escalations being lower than budgeted; and lower than budgeted operational costs for the Household Hazardous Waste depots.

It is recommended that the forecasted funding surplus for waste management be incorporated into the long term capital financing plans for the waste management programs.

Operating Funding Surplus	$2,235,157
% of total budget	4.56%
% of rate revenue	6.33%

Waste Management Consolidated Statement of Operations

Levy

Levy supported services are forecasting a surplus of $620,806 (0.09 per cent of budget), a result of $3 million in additional revenues primarily due to additional investment income and an increase in demand for NRPS special duty services. These additional revenues are offset by shortfalls in raw food costs and high intensity needs claims in Seniors Services, as well as compensations costs in NRPS and other Regional departments.

Levy supported boards and agencies are forecasting a deficit before indirect allocations of $266,735.

Operating Funding Surplus	$620,806
% of total budget	0.09%
% of levy revenue	0.18%

Levy Consolidated Statement of Operations

Notes

Staff will continue to closely monitor revenues and spending in order to minimize any deficits and take corrective action as required or where appropriate. The net levy surplus/deficit will be addressed in accordance with the Council approved Surplus/Deficit Policy at year-end. Final allocation of the year end surplus/deficit is subject to approval by Council projected to occur in early 2017.

It is important to note that there are certain risks to the above forecast including:

• Legal liability could fluctuate at year end depending on claims status
• Results of current collective bargaining are unknown
• Line of sight on supplemental taxes, payments-in-lieu, and assessment appeals are limited as all information for these items are not provided by the local area municipalities until year end. To this extent the forecast for these items remains at budget.