KAWARTHA LAKES-In a report to Council on June 15, Carolyn Daynes, Treasurer, outlined the net surplus of $4.5 million and how it was achieved over the various challenges of the pandemic year.
Daynes explained, “The 2020 net Surplus of $4.5 million is largely due to Council’s “prudent” financial approach to the pandemic early in the year. Officials say various measures were taken to ensure a balanced budget and tight cash flow management. The focus for the first half of the year was to concentrate on essential expenses only in all departments. In August, when upper levels of government announced funding to municipalities for pandemic relief, the Surplus was realized.”
Snapshot of 2020 financial year:
- Reduced revenues in user fees
The pandemic affected user fee revenue in several areas totalling $2.8 million: Community Services programs (sports rentals, hall rentals, recreation programs), Provincial Offences Revenue, Library Revenues, Transit fees, Tax and Utility Administration Fees and Parking fees. With offsets in other areas, such as increased tipping fees at landfills, cemetery fees and Ross Memorial Hospital funding of the Community Paramedic Program, user fee revenue at year-end was only $1,350,000 under budget.
- Pandemic costs
Costs of $600,000 that were strictly due to the pandemic include technology-related items, cleaning supplies, personal protective equipment, extra cleaning contracts and building maintenance and repair expenses.
- Reduced utility and vehicle fuel costs
With many municipal buildings remaining closed, staff working at home and the Ontario government’s reduction of hydro rates, utility costs were reduced by approximately $930,000 and vehicle fuels costs reduced by $380,000.
- Reduced staff wages
Short term layoffs, not hiring summer students, voluntary leaves and delays in hiring new staff resulted in $2.5 million in savings.
- Reductions in road services
Public Works reduced the budget by $1 million across all available areas of service, mainly in ditching, sweeping and roadside protection.
The following areas had a surplus which were transferred to reserves:
- Winter Control
A mild winter meant an average of 42 winter events, compared to 56 in 2019. This led to $1 million surplus to be transferred to the Contingency Reserve to help offset the fluctuations in budget requirements from year to year due to unknown weather patterns.
- Area Rates
Each year Council will transfer the surplus from area-rated services such as Fire, Police, street lighting, transit and community services into a reserve to be used to offset any future deficits or requirements. In 2020, there was $600,000 in surplus across the various area rates. This surplus allowed there to be no increase in the 2021 taxy levy for Fire Area C, Lindsay Parks, KLPS, OPP and street lighting.
- WSIB claims
The surplus of $300,000 will be transferred to a reserve to stabilize payments in future years.
- The Water and Wastewater surplus of $635,000 will be returned to a reserve for future infrastructure needs.
- KLH Housing Corp. transferred to reserves a surplus of $155,000. This surplus resulted from increased rental income as well as decreased costs in property taxes and utilities.
- The remaining $3.2 million of the 2020 Surplus will be transferred to the Asset Management Reserve to fund capital projects.
“I’m pleased that despite the pressures of the pandemic, we were able to end 2020 on solid ground. We kept the tax levy for 2021 at a modest 1.5% increase, and we were even able to build up our reserves. This puts us in a good position for next year’s budget and allows us to move ahead on capital projects that are important to the community,” commented Mayor Letham.