Financial Position & Operating Results

The Town’s financial position remained strong to the end of 2022. Total net financial assets were $19.5 million, which is an increase from December 2021 of $2.4 million. Total accumulated surplus increased from $112 million to $116.6 million. Restricted surplus reserves increased from $19.8 million to $20.5 million.

Financial assets consists mainly of cash, investments, accounts receivable, and land held for resale inventory. Liabilities increased mainly from the drawing of long term debt for construction of a regional wastewater treatment facility.

Operating activities ended with a surplus of $219,298. This included revenue of $21.5 million to budgeted revenue of $20.1 million. Operating expenses were $21.3 million to budget of $21.3 million.

After other income and expenses, total excess of revenues over expenses was $4.1 million. Other income included contributed assets of $1.9 million, government transfers for capital of $2 million, and a small gain on tangible capital asset disposals.

Consolidated Operating Results

in 000s Budget 2022

Financial Position Outlook

Over the next few years, the Town continues to have significant capital projects planned. This includes construction of a regional wastewater treatment facility, which has a construction budget of $30 million and which will come into service during 2024 or 2025. The project could result in the drawing of additional long-term debt. Other significant projects planned during 2023 include aquatics center upgrades, infrastructure upgrades, contributions to Clearwater Regional Fire Services for the purchases of various equipment, and other equipment and vehicle purchases.

The Town ended 2022 with a significant amount of deferred revenue, which included $4.5m of grant held for construction of the regional wastewater treatment facility and deferred Municipal Sustainability Initiative revenue of $1.9 million, most of which is planned to be used during 2023 on capital projects.

Operating activities during 2023 will continue to face pressure from inflation and ongoing repairs and maintenance expenses on aging equipment and infrastructure. Annually, the budget remains unpredictable on repairs for water main breaks, road repairs, or other infrastructure breaks because these cannot be foreseen.

Revenues

Overall revenues were overbudget. Increasing interest rates caused investment income to exceed budget and the other category included a $268,695 gain on change in landfill closure and post-closure costs liability, which is a non-cash revenue item. Revenues exceeded budget in most categories.

Municipal services exceeded budget mainly on account of recreation revenues exceeding budget. Utilities exceeded budget from greater consumption than budget and the initiation of garbage fees at the Town’s transfer station.

Operating Expenses

Overall expenses aligned reasonably to budget, being less than 1% under budget.

Administration fell under budget within a few subfunctions, which was caused by a councilor vacancy and the IT hardware and software categories. The Town’s contribution to the Clearwater Regional Fire Services operation was less than budgeted causing protective services to be under budget. Staff vacancies and turnover, and a lack of infrastructure breakages contributed to operations and utilities being under budget. Recreation and culture included unforeseen repairs to the Aquatics Centre and budget overages on utility expenses. Social services was over budget from the use of carryforward grant revenues.

Other income and expenses included a developer’s contribution to a portion of the 54th Street extension project, gain sale of disposal of tangible capital assets, and grants utilized for capital projects. Government transfers for capital appeared significantly under budget, which aligned with under budget on capital additions. This was largely because the regional wastewater treatment plant project construction was expected during 2022. The project’s budget is carrying forward to future years.