City operations are on track to finish the year in the black, with capital spending “as expected.”
Released on Thursday, a city staff report shows operations are anticipated to see a $850,000 surplus for 2024, reached by combining a $1.7 million excess in taxpayer funds and a $900,000 deficit in non-tax spending.
“Actual year-end results may be impacted by items yet unknown, as staff continue to focus on service delivery and expense management,” explains the report, which is heading to council’s committee of the whole meeting on Dec. 4.
“Staff have continued to recommend that rebuilding contingency reserve balances with year-end surpluses be prioritized to reduce vulnerability to unexpected events and improve the capacity to smooth future budget impacts.”
Recommendations in the report urge council to put the surplus funds toward paramedic facility renewal work ($448,000) and a variety of road projects.
On the capital side of things, spending has been largely as anticipated, the report notes.
There was $473.1 million in projects carried over from last year, in addition to $208.7 million for 2024 featured in the city budget.
“The city is trending positively and as expected with spending of $109.3 million and purchase order (PO) commitments of $287.7 million as of the end of (September),” the report states. “This leaves $264.3 million (or 40 per cent) of approved, but yet to be executed budgeted projects. “Through an indepth review of capital projects in March 2024, as well as newly implemented internal metrics, we expect to maintain the progress made in 2023 with having 75 to 80 per cent of project budgets committed or spent by year-end.”
Capital revenues are lagging behind estimates, with city staff pointing to a sharp drop in development charges (DCs) as a major factor. As of the end of September, 23.3 per cent of the anticipated fees had been collected, with a projected shortfall of $32.2 million.
“Lower-than-expected housing development is also impacting operating revenue streams including building permits and development application fees, and this is actively being managed with expenditure management. These conditions are being experienced across the province, but with Bank of Canada monetary policy beginning to lower the cost of borrowing, staff are hopeful that these development conditions will begin to reverse.”
At the same time, provincially imposed DC exemption costs are trending at 110.2 per cent above budget as of the end of September.
