That, on the recommendation of the Managing Director, Corporate Services and City Treasurer, Chief Financial Officer, the following actions be taken with respect to 2017 year-end monitoring:
a) the 2017 Operating Budget Year-End Monitoring Report for the Property Tax Supported Budget (Appendix A to the staff report dated April 17, 2018), Water and Wastewater & Treatment Budgets BE RECEIVED for information; it being noted that an overview of the net corporate positions are outlined below:
i) the Property Tax Supported Budget surplus is $6.9 million as identified by Civic Administration, Boards and Commissions. The year-end surplus is $2.7 million greater than projected in the 2017 Operating Budget Mid-Year Monitoring Report. The $6.9 million operating surplus was contributed to the Operating Budget Contingency Reserve;
ii) the Water Rate Supported Budget surplus is $2.2 million. The year-end surplus is $1.6 million more than projected in the 2017 Operating Budget Mid-Year Monitoring Report. The $2.2 million surplus was contributed to the Water Capital Reserve Fund;
iii) the Wastewater & Treatment Rate Supported Budget surplus is $3.3 million. The year-end surplus is $1.3 million more than projected in the 2017 Operating Budget Mid-Year Monitoring Report. The $3.3 million surplus was contributed to the Wastewater Rate Stabilization Reserve;
b) notwithstanding the Council-approved Surplus/Deficit Policy, the Civic Administration BE AUTHORIZED to allocate $5 million of the $6.9 million surplus from the Property Tax Supported Budget to fund costs related to the subsidized transit programs which include free transit for children 5-12, a reduced rate transit pass for youth 13-17 pilot program, and an income-related subsidized transit pilot program for adults 18 and over, noting that costs in excess of available budgets for the pilot programs in 2018 and 2019 are approved to come from Operating Budget Surplus, and if required, Contingency Reserves;
c) notwithstanding the Council-approved Surplus/Deficit Policy, the Civic Administration BE AUTHORIZED to allocate the London & Middlesex Housing Corporation (LMHC) operational savings, currently estimated to be $37 thousand (subject to LMHC’s financial statement audit), included in the above noted $6.9 million surplus to the LMHC Employee Entitlement Reserve Fund to support its obligation for future employee entitlement costs;
d) the Civic Administration BE AUTHORIZED to allocate the remaining balance of surplus from the Property Tax Supported Budget in accordance with the Council approved Surplus/Deficit Policy as follows:
i) 50% to reduce authorized but unissued debt;
ii) 25% to the Community Investment Reserve Fund; and
iii) 25% to the Capital Infrastructure Gap Reserve Fund.
e) the Civic Administration BE AUTHORIZED to allocate $3.2 million of the $3.3 million Wastewater & Treatment Rate Supported Budget surplus to the Sewage Works Reserve Fund; it being noted that the Wastewater Rate Stabilization Reserve has achieved its targeted balance of 2.5% of the Wastewater & Treatment Revenue Budget, and that in previous years this Reserve Fund has been drawn from to offset operational deficits; and
f) the Civic Administration’s contribution of $3,578,214 ($2,905,476 – Property Tax Supported; $242,714 – Water; and $430,024 – Wastewater) to the Efficiency, Effectiveness and Economy reserves in 2017 BE RECEIVED for information;
it being noted that the reported year-end surplus is subject to the financial statement audit and adjustments related to the accounting for Tangible Capital Assets (PSAB 3150).