COMMUNITY UPDATE
For the fiscal year ended Dec. 31,
TOWN OF ROCKY MOUNTAIN HOUSE
TOWN OF ROCKY MOUNTAIN HOUSE
This annual Financial Report and Community Update has been prepared and compiled by the Town of Rocky Mountain House Corporate Services department, with support from Communications and all other Town departments.
Please contact the Town of Rocky Mountain House for additional copies:
Town of Rocky Mountain House
PO Box 1509 5116-50 Avenue
Rocky Mountain House, Alberta T4T 1B2
Call 403-845-2866
Email town@trmh.ca
Or visit www.rockymtnhouse.com
Government Finance Officers Association of the United States and Canada (GFOA) awarded a Canadian Award for Financial Reporting to the Town of Rocky Mountain House for its annual financial report for the fiscal year ended December 31, 2022. The Canadian Award for Financial Reporting program was established to encourage municipal governments throughout Canada to publish high-quality financial reports and to provide peer recognition and technical guidance for officials preparing these reports.
In order to be awarded a Canadian Award for Financial Reporting, a government unit must publish an easily readable and efficiently organized annual financial report, whose contents conform to program standards. Such reports should go beyond the minimum requirements of generally accepted accounting principles and demonstrate an effort to clearly communicate the municipal government’s financial picture, enhance an understanding of financial reporting by municipal governments, and address user needs.
A Canadian Award for Financial Reporting is valid for a period of one year only. We believe our current report continues to conform to the Canadian Award for Financial Reporting program requirements, and we will be submitting it to GFOA to determine its eligibility for another award.
LAND
The Town of Rocky Mountain House is committed to honoring the history, culture and contributions of Indigenous Peoples and respectfully displays its land acknowledgment in all Town facilities.
INTRODUCTION
MESSAGE FROM THE MAYOR & COUNCIL
The Town of Rocky Mountain House Council is proud to share this annual financial and community report for the year ending December 31, 2023.
Our Mission Statement is to support economic growth and strengthen municipal infrastructure in a fiscally and environmentally responsible manner. The Town also encourages and supports private-sector initiatives that promote economic growth, social well-being and quality of life.
To this end, Council had a productive year. We began 2023 with a Budget Open House to highlight for residents our financial map for the year ahead. We also developed a new Strategic Plan with the following guiding principles:
Fiscal Responsibility
Environmental Sustainability
Collaboration
Communication
These principles form the pillars of our decision-making process. Through careful deliberation we established a Core Services Policy that gives us clear parameters for prioritizing community requests. We also adopted a Development Incentive Policy and associated bylaw that enables Tax Incentives for Non-Residential Developments.
In 2023 we celebrated the groundbreaking for our new Wastewater Treatment Plan, with our municipal partner, Clearwater County. This $31-Million-Dollar project will meet environmental regulatory requirements and allow for decades of future growth.
We continued to action our Waste Reduction Strategy, and brought in blue bin curbside recycling service for residential properties.
We sought public input on the design and development of a possible new Civic Building, and in all things, we remain compliant with the Municipal Government Act of Alberta.
The Town’s inaugural report in 2019 earned the Government Finance Officers Association Canadian Award for Financial Reporting, an honour we received again in each subsequent year.
The publication of this 2023 report is a commitment to citizens that we are being responsible, practical, fair and consistent with the Town’s legislative and fiscal functions.
Debbie Baich Mayor
MEET YOUR COUNCIL
2021-2025
Mayor
Councillor Tina Hutchinson
Councillor Dave
Councillor Ken
Elected in February 2024 By-election
Councillor Shane
Served from 2021November 2023
Councillor Len
Councillor
Councillor
Debbie Baich
Auld
Boniface
Marley Capraro
Moesker
Phillips
Dale Shippelt
STRATEGIC PLAN 2023-2026
A strategic plan for any organization or community is all about developing a written plan of action designed to achieve identified objectives (goals).
The Town of Rocky Mountain House 2023-2026 Strategic Plan is an essential tool to assist the Town Council in moving forward in the best interest of the community.
The strategic plan helps to ensure that the Council, Town administration and the public are aligned in understanding what objectives the Council has prioritized for the community.
MISSION
To support economic growth and strengthen municipal infrastructure in a fiscally and environmentally responsible manner.
VISION
To cultivate a robust, diverse community where people and businesses thrive.
GUIDING PRINCIPLES
Fiscal Responsibility
Environmental Sustainability
Collaboration
Communication
STRATEGIC OBJECTIVES
BUILDING OUR LOCAL ECONOMY
The Town has a business attraction and development incentive policy.
The Town has competitive mill rates.
The Town facilitates business retention and expansion programs and services.
The Town has a Business Storefront Improvement Program
BUILDING OUR TOURISM SECTOR
The Town promotes Rocky Mountain House attractions, parks and events.
The Town is part of a Government of Albertafunded Tourism Marketing Zone.
The Town has a Destination Marketing Organization.
The Town has cultural tourism experience opportunities within Rocky Mountain House.
ENSURING A SAFE AND HEALTHY COMMUNITY
The Town has a Core Services Policy to define the Town’s role in providing services to the community.
The Town has demonstrable growth in proving itself as an inclusive, welcoming community.
The Town continues to action the Waste Reduction Strategy.
The Town has a Joint Use Planning Agreement with the local school divisions for the benefit of our community.
The Town continues to action the Recreation Master Plan.
Rocky Mountain House is promoted as a sports destination/sports tourism destination.
The Town has a transparent and proactive process for resident user engagement.
The Town successfully lobbies higher levels of Government for enhanced funding of social services.
TAKING CARE OF OUR INFRASTRUCTURE
The Town has an updated Utility Master Plan.
The Town has a long-term Facilities Plan.
All areas of Town have access to high-speed internet.
The Town successfully lobbies the Government of Alberta to conduct as functional study of Highways 11 and 11A.
MUNICIPAL SERVICES
Council has identified which services are core, supplementary and discretionary under the Core Services Policy 009/2023. This provides clarity to the public on responsibility and guides in the budgeting process. Core services are required in the budget, discretionary services are a higher priority than supplementary services.
Governance (Council and Committees)
Water and Wastewater
Treatment and Distribution
Land Use Planning and Permitting
Stormwater Management
Emergency Management
Community Engagement
Emergency Services (Police, Fire and Bylaw Enforcement
Occupational Health and Safety
Waste and Recycling
Road Maintenance
Finances
Legislative
Recreational Facilities & Programs
Community Centre
Library
Horticultural Services
Parks & Playgrounds
Economic Development Initiatives
Airport
Cemetery
SUPPLEMENTARY SERVICES
Health Services Support
Justice Services
Education Supports Grants to Non-profit Organizations
MESSAGE FROM THE CHIEF ADMINISTRATIVE OFFICER
I am pleased to again introduce this comprehensive annual community financial report on behalf of Administration for the Town of Rocky Mountain House.
This report outlines Town operations for the 2023 calendar year. It builds on the 2022 report and showcases, again, streamlined governance and accounting that meets or exceeds all our legislative obligations and strategic plan goals.
I give my utmost gratitude to the staff who work diligently to maintain our finances and operations at this high level. Across all departments, we are constantly reviewing service level expectations with Council, finding efficiencies, and reducing costs. This is an ongoing process to ensure the needed and wanted services in our community are provided in the best way.
I am proud to be a part of the Town of Rocky Mountain House team going into 2024 and I look forward to reflecting on even more progress and achievements in the years to come.
Dean Krause CLGM CPT Chief Administrative Officer
ORGANIZATIONAL CHART
Mayor
Municipal
Regional
Human
DEPARTMENTAL OVERVIEWS
CORPORATE
SERVICES
OVERVIEW
Director Betty Quinlan
Corporate Services manages the entire organization's financial transactions and fiscal responsibilities in accordance with the Municipal Government Act and other provincial and federal laws and regulations. It is also responsible for information technology, human resources, assessment, taxation, budgeting and all financial policies.
ASSESSMENT & TAXATION
Number of Assessment and Taxation Notices 4,727
UTILITIES
Number of Commercial Utility Accounts 424
Number of Residential Utility Accounts 2,238
ANIMAL LICENSES
Number of Dog Licenses 682
ENGINEERING & OPERATIONS OVERVIEW
Director Rob Shanks
Engineering and Operations is responsible for 56 kilometres of paved roads, a network of alleys and underground water distribution and wastewater pipelines. It manages the Class III Water Treatment Plant, wastewater treatment facility, parks, grounds and playgrounds and the town's fleet of vehicles and equipment.
2023
ROADS
Kilometres of Paved Roads 56
Kilometres of Gravel Alleys 25
WATER & WASTEWATER
Kilometres of Watermains 505
Kilometres of Stormwater Lines 20 Kilometres of Sanitary Sewer Mains 54
FLEET
Litres of Diesel 37,161 Litres of Gas 31,217
WASTE & RECYCLING
Kilograms of Garbage Collected 849,850
Kilograms of Recycling Collected 154,530
Kilograms of Organics Collected 553,971
TRAILS
Kilometres of Trails 17
PARKS
Number of Parks 21 Acres of Greenspace 275
AIRPORT
Number of Arrivals 4054 Number of Departures 4055
PLANNING & COMMUNITY DEVELOPMENT OVERVIEW
Director Dean Schweder
Planning and Community Development oversees economic development, protective services and planning functions for the entire Town of Rocky Mountain House.
2023
PLANNING & DEVELOPMENT
Number of Development Permits 92
Developments of Note
Two Highway Commercial Buildings valued at $2.5 million Town’s Wastewater Treatment Plant valued at $31 million Number of Building Permits 84
Building Permit Values Residential
ECONOMIC DEVELOPMENT
Number of Business Licenses 575
Average Number of Vendors per Night (Marketplace on Main) 60
PROTECTIVE SERVICES
Community Relations
Protective Services held its annual Stuff the Cruiser event, in collaboration with various organizations. In 2023, the event received record support with a total value of $17,390 in donations.
Patrol also facilitated the Positive Ticket Program and participated in the Parade of Lights, Rocky Rodeo Parade, Annual Charity Check Stop events locally, to name a few.
Statistics
RECREATION & COMMUNITY SERVICES OVERVIEW
Director Wes Amendt
Recreation and Community Services manages all recreation and Town facilities in the Town of Rocky Mountain House, including booking, programming, staffing and maintenance. Residents and visitors of Rocky Mountain House, Clearwater County and Village of Caroline access Town facilities every day. In addition to community facilities, this department also manages the regional Family & Community Support Services (FCSS).
FACILITIES
Rocky Regional Recreation Centre
Two Indoor Ice Surfaces
Fitness Centre
Meeting Rooms
Guest Services
Lou Soppit Community Centre
Credit Union Co-op Aquatic Centre
Recreation Park Ball Diamonds
Edward Jones Tennis Courts
Cooperative Park
Rocky Spray Park
Skateboard Park
Co-op Credit Union Field
Curtis Field
Oval Track
Centennial Campground
Helen Hunley Memorial Park
North Saskatchewan River Park
PROGRAMS
Fitness Classes
Public Skating
Shinny Hockey
Youth Day Camps
Swimming Lessons
Swimming Certifications
Program Guide
FCSS
Partnership with Town, Government of Alberta and Clearwater County
Program Administration
Program Delivery
Grants to Organizations
In 2023, Family & Community Support Services (FCSS) programs offered preventative social services opportunities to residents, emphasizing community development, fostering connections, and building positive relationships.
FINANCIAL STATEMENT
PROCESS & TIMELINE
December 31, 2023
Fiscal Year End
January 2024
March 2024
April 2024
April 2024
May 1, 2024
June 30, 2024
Administration compiles financial information into Financial Statements
External Audit of Financial Statements begins
External Audit completed and presented to Council for review and approval
Approved Financial Statements presented to the public
Submitted to Municipal Affairs by legislated deadline
Annual Financial Report submitted to GFOA for award consideration
FINANCIAL INFORMATION
MESSAGE FROM THE DIRECTOR OF CORPORATE SERVICES
April 24, 2024
I am pleased to present the fifth Annual Financial Report for the Town of Rocky Mountain House. This 2023 report aims to deliver a clear and concise update on the town's activities and financial status. By expanding upon the audited financial statements, readers will gain a comprehensive understanding of the Town's initiatives and how they relate to the financial statements.
In compliance with Section 276 of the Municipal Government Act (MGA) of Alberta, all municipalities must undergo an audit and prepare audited statements in line with the principles and standards set by the Public Sector Accounting Board (PSAB) of the Chartered Professional Accountants of Canada. This ensures consistent reporting and reliability of the presented information.
Management is responsible for preparing financial statements that accurately reflect the town's activities, including financial information and disclosures. This information provides valuable insights for both internal and external users on how the town delivers services and meets its objectives.
Guided by the Council's strategic plan, the town strives to provide high-quality, fiscally responsible, and environmentally sustainable services, aiming to foster a vibrant, diverse community where people and businesses can thrive.
Betty Quinlan, B. Comm, CPA, CMA Director of Corporate Services
FINANCIAL REPORT
LEGISLATIVE AUTHORITY AND SERVICES PROVIDED
As per the MGA, a municipality's purpose is to provide good governance through essential services, facilities, and programs that benefit the community, while fostering environmental well-being to maintain safe and viable communities. Additionally, municipalities must collaborate with neighboring municipalities to plan, deliver, and fund intermunicipal services.
Services are provided in several key areas to meet MGA mandates:
General Government: Mayor, Council and administration which includes CAO administration, legislative services, communications, finance, information technology, human resources, and risk management.
Protective Services: Policing, fire services, community/bylaw enforcement, occupational health and safety, and disaster services.
Operations: Road maintenance, snow removal, fleet maintenance, airport, and storm sewer operations.
Environmental Services: Water supply and distribution, wastewater collection, treatment and distribution, solid waste, and environmental stewardship.
Social Services: Clearwater Regional Family and Social Services, social housing programs, and cemetery services.
Planning & Development: Community planning and development, subdivision and land use by law development and management, building inspections, and economic development.
Recreation and Cultural Services: Recreational programs, arena, pool, parks, sports fields, community center, and library operations.
FINANCIAL MANAGEMENT
A comprehensive financial management system aligns the financial process with the Council's goals and objectives, translating the financial plan into a functional operational plan. The Council's strategic plan, reviewed annually, ties into a service level review document, and is used to assess and adjust service levels to meet community needs.
The budget document includes a current operating budget, a four-year forecast, a current capital budget, and a ten-year capital plan. A key component of the budget is balancing financing for operating and capital plans over five years, ensuring viability and sustainability. This involves considering available grants, projected taxation, potential increases, and debt servicing to meet objectives. This approach prioritizes capital development while ensuring reasonable community property taxes and future financing requirements.
The entire process becomes a blend of balancing requests for services with the ability to finance them and the reasonability of tax rates. The goal of Council is providing a community with a blend of services that cover the range of safety, functionality, recreational and future planning.
Performance against these three documents is monitored and reported to Council throughout the year, including quarterly financial reporting and variance analysis. This culminates in the annual year-end audit, which reviews municipal financial activity and produces audited financial statements. The independent auditor's report details the roles of the external auditor and management's responsibilities.
REGIONAL RELATIONSHIPS
TOWN OF ROCKY MOUNTAIN HOUSE
VILLAGE OF CAROLINE
SERVICE GROUPS
STRONGER TOGETHER
RESIDENTS
PARKLAND REGIONAL LIBRARY BOARD
CLEARWATER COUNTY
The Town of Rocky Mountain House operates independently but collaborates with several regional entities to enhance services. Key partnerships include Clearwater County, Parkland Regional Library Board, and the Village of Caroline. Numerous other service groups also share resources or information to improve service delivery.
FINANCIAL POLICIES
A robust system of financial policies and internal controls monitors financial activity, safeguards municipal assets, and ensures compliance with PSAB accounting standards. Internal controls cover segregation of duties, quarterly reporting, year-end auditing, review and approval processes, major area reconciliations, physical inventory counts, and standard approval levels throughout the organization.
BUDGET AND TAXATION
Guidelines for preparing and managing the town's budget and tax collection processes.
SURPLUS DISPOSAL
Protocols for the disposal of surplus assets.
TANGIBLE CAPITAL ASSETS
Management and reporting of capital assets to maintain accurate financial records.
PROCUREMENT AND PURCHASING
Procedures to ensure transparent and efficient purchasing practices.
SIGNING AUTHORITY
Defined levels of authorization for financial transactions and agreements.
CORPORATE CREDIT CARDS
Regulations governing the use of corporate credit cards to control expenses.
ASSET MANAGEMENT
Strategies for maintaining and utilizing town assets effectively.
LIABILITY FOR CONTAMINATED SITES
Policies to address financial responsibility for contaminated properties.
COMMUNITY GRANTS
Criteria and procedures for awarding grants to community organizations.
COUNCIL REMUNERATION
Policies outlining compensation for council members.
RELATED PARTY DISCLOSURES
Ensuring transparency in transactions involving related parties.
YEAR-END SURPLUS ALLOCATION
Guidelines for distributing any surplus funds at the end of the fiscal year.
RESERVES
Management of reserve funds to ensure financial stability.
These internal controls cover key areas such as segregation of duties, quarterly financial reporting, annual audits, and review and approval processes. They include major area reconciliations, physical inventory counts, and established approval levels throughout the organization to maintain accountability and transparency.
SIGNIFICANT ACTIVITIES NOT EVIDENT FROM THE FINANCIAL SECTION
The Town of Rocky Mountain House continues to make progress on its Waste Reduction strategy. To reach the complementary goals of increased diversion and overall reduction of waste going to the Clearwater Regional Landfill, there are now three streams of residential curbside collection: garbage, recycling and organics. Measured by both volume and tonnage, diversion of recyclable and organic materials has doubled since 2021.
Ultimately, this will flow through the financial statements as success should enable the Town to reduce costs for landfill management and any future obligations or liabilities this could create. Additionally, we are poised for a smooth transition to Extended Producer Responsibility (EPR) when it takes effect in Alberta, further reducing the operational cost of our recycling program.
Another major area currently under review that does not readily show in the financial statements is working with our neighbouring communities to review and update partnership agreements. The Town and Clearwater County continue to renew and update agreements, such as for the Rocky Mountain House Airport, and recreation facilities and programs.
Another unique long-term relationship is the partnership with our Twin Town of Kamikawa, Japan. This relationship was formalized in 1984 and continues through strong social ties and friendships. Additionally, Mayor and Council participate in meetings with provincial officials and Japanese envoys to explore partnerships for mutual economic benefit.
SIGNIFICANT LOCAL ECONOMIC EVENTS
There are two significant economic events in 2023 that impacted the Town of Rocky Mountain House.
The first is inflation and rising interest rates across Canada. The year ended with inflation sitting at approximately 3.0%. While not unique to Rocky Mountain House, inflation has affected the cost of goods and plans for future budgeting. Secondly, with supply chain issues and rising costs, the cost of capital projects has been coming in over budget for several projects. This will have a long-term impact if the cost of capital replacement rises significantly.
The entire province of Alberta was affected by severe wildfire conditions in 2023. While Rocky Mountain House was not threatened by active fires, our tourism season was nevertheless severely impacted due to pervasive wildfire smoke. The hospitality industry suffered a great deal from the lack of visitor revenue.
PROSPECTS FOR THE FUTURE
The Town of Rocky Mountain House remains committed to providing sound financial stewardship for its residents and businesses. A fully funded 10-year financial capital plan has been developed and approved, ensuring the continued maintenance of infrastructure and services while preserving the necessary financial base for future needs.
Through strategic planning, service level reviews, and a rigorous budgeting process, the Council ensures the Town's operations are running as efficiently as possible. This proactive approach allows the Town to quickly and effectively respond to new opportunities as they arise.
MESSAGE FROM THE FINANCE MANAGER
I am pleased to announce that the Town has, for the fifth consecutive year, prepared a comprehensive annual report. This milestone reflects our commitment to transparency, accountability, and continuous improvement in our financial practices.
The annual report includes much more than just the audited financial statements. It offers a detailed analysis, five-year comparative financial information, and additional economic data, providing a comprehensive overview of the Town's financial health and economic environment.
The Corporate Services Department has been instrumental in this achievement. Our team is responsible for internal financial reporting, which involves providing quarterly updates to the council, collaborating with our auditors through the audit engagement, and working with various departments to establish and maintain appropriate internal controls. Furthermore, we are dedicated to assisting departments in compiling and monitoring the budget in alignment with the Council’s objectives.
This comprehensive approach ensures that we not only meet our financial reporting obligations but also provide valuable insights and data that support informed decision-making for the betterment of our community.
I would like to extend my gratitude to everyone involved in this process. Your dedication and hard work have been crucial to our success.
Thank you for your ongoing support and commitment to our Town’s financial integrity.
Mike Van De Velde, CPA, CA Finance Manager
FINANCIAL STATEMENT AND ANALYSIS
FINANCIAL POSITION AND OPERATING RESULTS
The audited statements provide a comprehensive overview through consolidated statements of:
Financial position
Operations
Changes in net financial assets
Cash flows
Additionally, several supporting schedules detail major activity categories, accompanied by notes that explain balance sheet items and other operational activities throughout the year. These statements reflect the Town's operational activities for the 2023 fiscal year.
CONSOLIDATED STATEMENT OF
FINANCIAL POSITION
This statement presents the assets and liabilities at a specific point in time, highlighting the Town's financial position by showcasing net financial assets and accumulated surplus.
Financial assets include cash, investments, accounts receivable, and land held for resale inventory. Liabilities comprise accounts payable, deferred revenue, long-term debt, and asset retirement obligations.
The difference between assets and liabilities represents the net financial position, indicating the amount of cash the organization would have if all assets and liabilities were liquidated.
The Town demonstrates a strong financial position with growing reserve balances and net financial assets (remaining assets after liabilities are paid) amounting to $21 million. Non-financial assets have increased by $7 million from 2022 due to the completion of capital projects being added to tangible capital assets. This figure is expected to rise significantly over the next two years with the completion of the $31 million wastewater treatment plant.
Assets in 2023 were higher due to increased cash balances, resulting from advance grant receipts and growing reserve balances.
Liabilities increased due to higher deferred revenue balances, which consist of grants received but not yet utilized. These funds will be expended in future years as capital projects are completed.
CONSOLIDATED STATEMENT OF
OPERATIONS
This statement reflects the operating activities for the year, including any capital funding received for tangible capital asset projects. Municipalities prepare an annual operating budget, and activities are measured against this budget. This statement is a key document for the Council as it demonstrates how well the organization met the goals and activities outlined in the budget.
The surplus or deficit for the year, shown as the excess of revenue over expenses, serves as a critical performance and accountability measure.
Overall, financial activities for 2023 closely aligned with the budget, with only a few areas showing significant variances. Operating activities concluded with a surplus of $956,058. Revenue exceeded the budget due to higher interest income and additional grants. These extra funds have been transferred to reserves for future capital projects. Expenditures were slightly over budget but generally remained close to planned activities.
Other activities include a small gain on the sale of tangible capital assets and government transfers (grants) for capital projects. Government grants were notably high in 2023 due to the construction of a $31 million wastewater treatment plant, which received $20 million in federal and provincial grants.
The accumulated surplus increased by $8.1 million, reflecting both the annual operational surplus and the addition of tangible capital assets.
Consolidated Operating Results
COMPARISON TO PRIOR YEAR
Revenues in 2023 were $1.3 million higher than in 2022. The major factors contributing to this increase are:
• Higher Interest Rates: Generated an additional $1.15 million in 2023 on cash balances.
• Other Revenue in 2022: Included a $269,000 reduction in post-closure liability, making the comparative figure lower.
• Sales & User Fees, Permits & Licenses, and Franchise Fees: Increased in 2023, resulting in an additional $415,000 in revenue.
• Property Tax Increase: A 2% increase generated an additional $190,000.
Expenditures in 2023 were $609,000 higher than in 2022. The primary areas of change include:
• Salaries and Benefits: Increased in 2023 due to higher cost-of-living adjustments driven by inflation.
• Amortization: Increased from 2022, which is expected as new projects are amortized at a higher cost than historical balances.
• Fire Contract Costs: Decreased due to lower costs during the year. The Regional Fire Service generated higher revenues from billing for attendance at motor vehicle accidents, which helped reduce annual expenditures.
REVENUES
The operating results for the year show that revenues were higher than budgeted. This is due to increased interest rates, higher building permits and grants. Operational revenue was overall on target.
EXPENDITURES
Overall Expenditures: The total expenditures for the year were very close to the budgeted amounts, exceeding the budget by $383,000, including amortization.
Regular Operating Expenditures: Regular operating expenditures were $549,000 under budget. This indicates effective cost management and operational efficiency, ensuring that routine expenses were kept well within the planned financial limits.
Amortization: Amortization costs came in over budget. As a non-cash transaction, this overage does not impact the cash flow directly but affects the overall accounting of asset depreciation.
Landfill Remediation Costs: The landfill remediation costs are comprised of post-closure liability and annual remediation expenses. These costs are unique and separate due to their association with the closure of a jointly operated landfill with the County in previous years. These expenditures are funded from the solid waste reserve, ensuring that they do not impact the regular operating budget.
Summarized Operating Statement
Below is a summary of the key expenditure categories:
• Overall Expenditures (including amortization): $383,000 over budget
• Regular Operating Expenditures: $549,000 under budget
• Amortization: $470,000 over budget (non-cash expense)
• Operations & Infrastructure: $130,000 over budget (due to repairs and higher electricity costs)
• Protective Services: Under budget (due to lower firefighting costs and timing differences in RCMP contract payments)
• Landfill Remediation Costs: Funded from the solid waste reserve
CONSOLIDATED STATEMENT OF CHANGES IN NET FINANCIAL ASSETS
The Statement of Changes in Net Financial Assets provides a reconciliation of the change in net financial assets between the current period and the prior year. This statement connects the annual operating surplus or deficit, as reported in the Statement of Operations, to the change in net assets indicated in the Statement of Financial Position.
Statement of Changes In Net Financial Position
CONSOLIDATED STATEMENT OF CASH FLOWS
This statement explains the change in cash and cash equivalents from the prior year and provides information about how cash is generated to meet the needs for the year. The layout shows how the entity financed its activities.
ROLE OF THE AUDITOR
The Municipal Government Act requires that Council appoints an independent auditor to review the financial activity every year. Baker Tilly WCR LLP , a local firm, has been the auditor to the Town of Rocky Mountain House for many years. It was recently the successful candidate in a request for proposal for the upcoming audit term.
The role of Baker Tilly WCR LLP is to review the financial activity and present an independent audit opinion that the consolidated statement presents fairly the financial position of the Town, and that the statements are prepared in accordance with Canadian Public Sector Accounting Standards.
The audit committee contains all members of Council and it is their responsibility to appoint the auditor, review and approve the terms of engagement every year, meet with the auditor prior to the audit to discuss the scope of the audit and to review the final audited statements as well as any audit findings and to accept and approve the audited financial statements. They are also responsible to ensure that management is completing its responsibilities in managing the entire financial process including the audit.
Quarterly financial statements are presented to Council for March, June and September each year and a year-end analysis is presented once the financial statements are complete.
The reader will notice that the signatures have been redacted in the presented financial statements. This was done following section 17 of the Freedom of Information and Protection of Privacy Act (FOIP) for the purpose of protecting personal information.
AUDITED FINANCIAL STATEMENTS
TOWN OF ROCKY MOUNTAIN HOUSE
CONSOLIDATED
FINANCIAL STATEMENTS
DECEMBER 31, 2023
MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL REPORTING
To the Mayor and Councilof the Town of RockyMountain House
Management of the Town of RockyMountain House (Town) is responsible for the preparation, accuracy, objectivity and integrity of the accompanying consolidated financial statements and all other information contained within this Financial Report. Management believes that the consolidated financial statements present fairly the Town's financial position as at December 31, 2023 and the results of its operations for the year then ended.
The consolidated financial statements have been prepared in accordance with Canadian public sector accounting standards (PSAS).
The consolidated financial statements include certain amounts based on estimates and judgments. Such amounts have been determined on a reasonable basis in order to ensure that the consolidated financial statements are presented fairlyin allmaterial respects.
In fulfilling its responsibilities and recognizing the limits inherent in all systems, management has designed and maintains a system of internal controls to produce reliable information and to meet reporting requirements on a timely basis. The system is designed to provide management with reasonable assurance that transactions are properly authorized and assets are properly accounted for and safeguarded.
These systems are monitored and evaluated bymanagement and reliable financial information is available for the preparation of the consolidated financial statements.
The Town Council carries out its responsibilities for review of the consolidated financial statements principally through its Audit Committee. This committee meets regularly with management and external auditors to discuss the results of audit examinations and financial reporting matters.
The external auditors have full access to the Audit Committee with and without the presence of management. The TownCouncil has approved the consolidated financial statements.
The consolidated financial statements have been audited by Baker Tilly WCR LLP, Chartered Professional Accountants, independent external auditors appointed by the Town. The accompanying Independent Auditor's Report outlines their responsibilities, the scope of their examination and their opinion on the Town's consolidated financial statements.
Redacted under Section 17 of the FOIP Act.
April 24, 2024
Dean Krause Date Chief Administrative Officer
Redacted under Section 17 of the FOIP Act.
April 24, 2024
BettyQuinlan Date Director of Corporate Services
BAKER TILLY WCR LLP
Suite #201, 5133 - 49 Street
P.O. Box 100
Rocky Mountain House, AB Canada, T4T 1A1
O: 1 (403) 845-3226 F: 1 (403) 845-5666
INDEPENDENT AUDITORS' REPORT
To the Mayor and Councilof the Town of RockyMountain House Opinion
We have audited the accompanying consolidated financial statements of the Town of Rocky Mountain House (the "Town"), which comprise the consolidated statement of financial position as at December 31, 2023, and the consolidated statements of operations, changes in net financial assets and cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies and other explanatoryinformation.
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects the consolidated financial position of the Town as at December 31, 2023, and the results of its consolidated operations, change in net financial assets and cash flows for the year then ended in accordance with Canadian public sector accounting standards.
Basis for Opinion
We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Consolidated Financial Statements section of our report.
We are independent of the Town in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Other Information
Management is responsible for the other information. The other information comprises the information included in the Annual Report, but does not include the consolidated financial statements and our auditors' report thereon. The Annual Report is expected to be made available to us after the date of this auditors' report.
Our opinion on the consolidated financial statements does not cover the other information and we will not express anyform of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statement or our knowledge obtained in the audit, or otherwise appears to be materially misstated. When we read the annual report, if we conclude that there is a material misstatement of this other information, we are required to report that fact to the Mayor and Council.
Responsibilities of management and Council for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with Canadian public sector accounting standards, and for such internal control as management determines is necessary to enable preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Town's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate or to cease operations, or has no realistic alternative but to do so.
Councilis responsible for overseeing the Town's financial reporting process.
Auditors' responsibilities
for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Town's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made bymanagement.
Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Town's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Town to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with Council regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including anysignificant deficiencies in internal control that we identifyduring our audit.
RockyMountain House, Alberta
Chartered Professional Accountants April24, 2024
FINANCIAL ASSETS
CONSOLIDATED STATEMENT OF FINANCIAL POSITION DECEMBER 31, 2023
ACCUMULATED SURPLUS (Schedule 1, Note 15) $124,712,590 $116,609,400 Contractual Rights, Contractual Obligations and Contingencies - See Note 17 Approved byTown Council: See accompanying schedules and notes to the financial statements.
REVENUE
TOWN OF
HOUSE CONSOLIDATED STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 2023
See accompanying schedules and notes to the
CONSOLIDATED STATEMENT OF CHANGE IN NET FINANCIAL ASSETS YEAR ENDED DECEMBER 31, 2023
See accompanying schedules and notes to the financial statements.
TOWN OF ROCKY MOUNTAIN HOUSE
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2023
NET INFLOW (OUTFLOW) OF CASH RELATED TO THE FOLLOWING ACTIVITIES:
TOWN OF ROCKY MOUNTAIN HOUSE
SCHEDULE OF CHANGES IN ACCUMULATED OPERATING SURPLUS FOR THE YEAR ENDED DECEMBER 31, 2023 SCHEDULE 1
ACCUMULATED AMORTIZATION:
TOWN OF ROCKY MOUNTAIN HOUSE SCHEDULE OF TANGIBLE CAPITAL ASSETS FOR THE YEAR ENDEDDECEMBER 31, 2023 SCHEDULE 2
TOWN OF ROCKY MOUNTAIN HOUSE
SCHEDULE OF PROPERTY AND OTHER TAXES FOR THE YEAR ENDED DECEMBER 31, 2023 SCHEDULE 3
MUNICIPAL TAXES (AFTER REQUISITIONS)
REQUISITIONS
(AFTER
Budget (Unaudited) 2023 2022
$9,329,963 $9,318,017 $9,127,290
SCHEDULE OF GOVERNMENT TRANSFERS FOR THE YEAR ENDED DECEMBER 31, 2023 SCHEDULE 4 Budget (Unaudited) 2023
TOTAL GOVERNMENT TRANSFERS $18,438,415 $10,433,044 $5,460,833
TOWN OF ROCKY MOUNTAIN HOUSE
SCHEDULE OF CONSOLIDATED EXPENSES BY OBJECT FOR THE YEAR ENDED DECEMBER 31, 2023 SCHEDULE 5
CONSOLIDATED EXPENSES BY OBJECT
TOWN OF ROCKY MOUNTAIN HOUSE
TOWN OF ROCKY MOUNTAIN HOUSE
SCHEDULE OF SEGMENTED DISCLOSURE FOR THE YEAR ENDEDDECEMBER 31, 2023 SCHEDULE 6
TOWN OF ROCKY MOUNTAIN HOUSE
SCHEDULE OF SEGMENTED DISCLOSURE FOR THE PREVIOUS YEAR ENDEDDECEMBER 31, 2022 SCHEDULE 6
TOWN OF ROCKY MOUNTAIN HOUSE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2023
The Townof RockyMountain House (the Town) is a municipalityin the Province of Alberta, Canada and operates under the provisions of the Municipal Government Act, R.S.A., 2000, c. M-26, as amended (MGA).
1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The consolidated financial statements (the financial statements) of the Town are the representations of management prepared in accordance with generally accepted accounting principles for local governments established by the Public Sector Accounting Board and as published by the Chartered Professional Accountants of Canada. Significant aspects of the accounting policies adopted bythe Town are as follows:
(a) Reporting Entity
The financial statements reflect the assets, liabilities, revenues and expenses, changes in fund balances and change in financial position of the reporting entity. This entity is comprised of municipal operations plus all the organizations that are owned or controlled bythe Townand are, therefore, accountable to the town council for the administration of their financial affairs and resources.
Included in these financial statements are fifty percent of the Rocky Mountain House Municipal Airport assets, liabilities, revenues and expenses.
The schedule of taxes levied also includes operating requisitions for education, health, social and other external organizations that are not part of the municipal reporting entity.
The statements exclude trust assets that are administered for the benefit of external parties. Interdepartmental and organizational transactions and balances are eliminated.
(b) Basis of Accounting
The financial statements are prepared using the accrual basis of accounting. The accrual basis of accounting records revenue as it is earned and measurable. Expenses are recognized as they are incurred and measurable based upon receipt of goods or services and/or the legal obligation to pay.
Funds from external parties and earnings thereon restricted by agreement or legislation are accounted for as deferred revenue untilused for the purpose specified.
Government transfers, contributions and other amounts are received from third parties pursuant to legislation, regulation or agreement and may only be used for certain programs, in the completion of specific work, or for the purchase of tangible capital assets. In addition, certain user charges and fees are collected for which the related services have yet to be performed.
Revenue is recognized in the period when the related expenses are incurred, services performed or the tangible capital assets are acquired.
1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(c) Use of Estimates
The preparation of the financial statements in conformity with Canadian public sector accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures during the reporting period. Where estimation uncertainty exists, the financial statements have been prepared within reasonable limits of materiality. Actual results could differ from estimates. The amounts recorded for valuation of tangible capital assets, non-vesting employee benefit liabilities, asset retirement obligation, contingent liabilities and commitments and accruals are areas where management makes significant estimates and assumptions in determining the amounts to be recorded in the financial statements.
(d) Valuation of Financial Assets and Liabilities
The town's financial assets and liabilities are measured as follows:
Financial statement component
Cash and cash equivalents
Trade and other receivables
Measurement
cost and amortized cost
lower of cost or net recoverable value
Long term receivable lower of cost or net recoverable value
Investments amortized cost
Accounts payable and accrued liabilitiescost
Securitydeposits cost
Demand loan amortized cost
Long term debt amortized cost
(e) Cash and Cash Equivalents
Cash includes items that are readily convertible to known amounts of cash, are subject to an insignificant risk of change in value, and have a maturityof three months or less at acquisition.
(f) Debt Charges Recoverable
Debt charges recoverable consist of amounts that are recoverable from municipal agencies or other local governments with respect to outstanding debentures or other long-term debt pursuant to annexation orders or joint capital undertakings. These recoveries are recorded at a value that equals the offsetting portion of the un-matured long-term debt, less actuarial requirements for retirement of any sinking fund debentures.
(g) Long-term Receivables
Long-term receivables are initially measured at cost with valuation allowances subsequently used to reflect loans receivable at the lower of cost and net recoverable value. Changes in valuation allowances are recognized as expenses in the statement of operations. Interest revenue is recognized when earned, to the extent the collectibilityof the loan and interest is reasonablyassured.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(h) Long-term Debt
Long term debt is initially recognized net of any premiums, discounts, fees and transactions costs, with interest expense recognized used the effective interest method. Long-term debt is subsequently, measured at amortized cost.
(i)
Requisition Over-levyand Under-levy
Over-levies and under-levies arise from the difference between the actual property tax levy made to cover each requisition and the actual amount requisitioned.
If the actual levy exceeds the requisition, the over-levy is accrued as a liability and property tax revenue is reduced. Where the actual levy is less than the requisition amount, the under-levy is accrued as a receivable and as propertytax revenue.
Requisition tax rates in the subsequent year are adjusted for any over-levies or under-levies of the prior year.
(j)
Land for Resale Inventory
Land held for resale is recorded at the lower of cost or net realizable value. Cost includes costs for land acquisition and improvements required to prepare the land for servicing such as clearing, stripping and leveling charges. Related development costs incurred to provide infrastructure such as water and wastewater services, roads, sidewalks and street lighting are recorded as physical assets under the respective function.
(k) Tax Revenue
Tax revenues are recognized when the tax has been authorized by bylaw and the taxable event has occurred. Requisitions operate as a flowthrough and are excluded from municipal revenue.
1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(l) Asset Retirement
A liability for an asset retirement obligation is recognized at the best estimate of the amount required to retire a tangible capital asset at the financial statement date when there is a legal obligation for the town to incur retirement costs, the past transaction or event giving rise to the liability has occurred, it is expected that future economic benefits will be given up, and a reasonable estimate of the amount can be made. The best estimate of the liability includes all costs directly attributable to asset retirement activities, based on information available at year-end. The best estimate of an asset retirement obligation incorporates a present value technique, when the cash flows required to settle or otherwise extinguish an asset retirement obligation are expected to occur over extended future periods.
When a liabilityfor an asset retirement obligation is initially recognized, a corresponding asset retirement cost is capitalized to the carrying amount of the related tangible capital asset. The asset retirement cost is amortized over the useful life of the related asset. Asset retirement obligations which are incurred incrementally with use of the asset are recognized in the period incurred with a corresponding asset retirement cost expensed in the period.
At each financial reporting date, the Town reviews the carrying amount of the liability. The Town recognizes period-to-period changes to the liability due to the passage of time as accretion expense. Changes to the liability arising from revisions to either the timing, the amount of the original estimate of undiscounted cash flows or the discount rate are recognized as an increase or decrease to the carrying amount of the related tangible capital asset. The Town continues to recognize the liability until it is settled or otherwise extinguished. Disbursements made to settle the liability are deducted from the reported liabilitywhen theyare made.
(m) Revenue
The Townfollows the accrual method of accounting for revenues and expenses. Revenues are recognized in the year in which theyare earned and measurable. Funds from external parties and earnings thereon restricted byagreement or legislation are accounted for as deferred revenue untilused for the purpose specified.
Propertytax revenue is based on market value assessments determined in accordance with the Municipal Government Act. Tax rates are established annually. Taxation revenues are recorded at the time tax billings are issued. Assessments are subject to appeal.
User fees and sales of goods are recognized in the period in which the goods are provided, or the services are rendered. Revenues from sponsorships are recognized over the terms of the sponsorship agreements. Rental revenue is recognized in the relevant tenancyperiod.
Government transfers and grants are recognized in the consolidated financial statements as revenues in the period that the events giving rise to the transfer occurred, providing the transfers are authorized, and eligibilitycriteria have been met bythe Town, and reasonable estimates of the amounts can be made. Prior to that, anyamounts received are recorded as deferred revenue.
Investment income is recorded as revenue in the period earned. When required bythe funding government or related act, investment income earned on deferred revenue is added to the investment and forms part of the deferred revenue balance.
Requisitions operate as a flowthrough and are excluded from municipal revenue.
1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(n) Prepaid Local Improvement Charges
Construction and borrowing costs associated with local improvement projects are recovered through annual special property assessments during the period of the related borrowings. These levies are collectible from propertyowners for work performed bythe municipality.
Where a taxpayer has elected to prepay the outstanding local improvement charges, such amounts are recorded as deferred revenue. Deferred revenue is amortized to revenue on a straight-line basis over the remaining term of the related borrowings.
In the event that the prepaid amounts are applied against the related borrowings, the deferred revenue is amortized to revenue byan amount equal to the debt repayment.
(o) Employment Benefits Liabilities
The Townrecognizes liabilities for post-employment benefits and compensated absences that vest or accumulate during the period in which the employment services are rendered, assuming payment of benefits is probable and the amounts can be reasonablyestimated. Accumulating, vesting benefits liabilities are measured at cost. Accumulating, non-vesting benefits liabilities are recognized at cost to the extent theyare expected to be used byemployees.
(p) Deferred Revenues
Deferred revenues represent government transfers, donations, and other amounts which have been collected, but for which the related services have yet to be performed or agreement stipulations have not been met. These amounts willbe recognized as revenues when revenue recognition criteria have been met. Interest earned on deferred revenues, reserves, and offsite levies are calculated using an average investment earnings monthly.
(q) Pension
The Townparticipates in a multiemployer defined benefit pension plan. Contributions for current and past service pension benefits are recorded as expenses in the year in which theybecome due. See Note 19 for details of the pension plan.
(r) Government Transfers
Government transfers are the transfer of assets from senior levels of government that are not the result of an exchange transaction, are not expected to be repaid in the future, or the result of a direct financial return.
Government transfers are recognized in the financial statements as revenue in the period in which events giving rise to the transfer occur, providing the transfers are authorized, any eligibility criteria have been met, and reasonable estimates of the amounts can be determined.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(s) Non-Financial Assets
Non-financial assets are not available to discharge existing liabilities and are held for use in the provision of services. They have useful lives extending beyond the current year and are not intended for sale in the normal course of operations. The change in non-financial assets during the year, together with the excess of revenues over expenses, provides the consolidated change in net financial assets for the year.
(i) Tangible Capital Assets
Tangible capital assets are recorded at cost which includes all amounts that are directly attributable to acquisition, construction, development or betterment of the asset. The cost, less residual value of the tangible capital assets is amortized on a straight-line basis over the estimated useful life as follows:
No amortization is charged in the year of acquisition and a fullyear of amortization is taken in the year of disposal. Assets under construction are not amortized until the asset is available for productive use.
(ii) Contributions of Tangible Capital Assets
Tangible capital assets received as contributions are recorded at fair value at the date of receipt and also are recorded as revenue.
(iii) Leases
Leases are classified as capital or operating leases. Leases which transfer substantially all of the benefits and risks incidental to ownership of property are accounted for as capital leases. All other leases are accounted for as operating leases and the related lease payments are charged to expenses as incurred.
(iv) Inventories
Inventories held for consumption are recorded at the lower of cost determined on a specific identification basis and net realizable value.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(p) Contaminated Sites Liability
Contaminated sites are a result of contamination being introduced into air, soil, water or sediment of a chemical, organic or radioactive material or live organism that exceeds an environmental standard. A liabilityfor remediation of a contaminated site is recognized when the town is either directlyresponsible or accepts responsibilityand is management's estimate of the cost of post-remediation including operation, maintenance and monitoring.
(r) Cash Flow Reporting
The Townfollows the indirect method in reporting its cash flows from operating activities.
2.CASH AND CASH EQUIVALENTS 2023 2022 Cash $38,973,202 $ 21,400,538
Cash includes amounts held in a chequing bank account earning interest at graduated rates ranging from the bank's prime rate less 1.90% - 1.45% (2022 - 1.90% to 1.55%) per annum. The effective rate at year end is 5.30% - 5.75% (2022 - 4.55% - 4.90%) per annum. Cash also includes amounts held in a savings account earning interest at 3.10% (2022 - 1.80%) per annum.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
3.TAXES RECEIVABLE
4.TRADE AND OTHER RECEIVABLES
These allocations are receivable as the Town has submitted eligible capital projects that were sufficient for the release of the capital funding.
5.INVESTMENTS
Investments are non-redeemable guaranteed investment certificates (GIC's) on deposit with the Alberta TreasuryBranch.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
6.LONG TERM RECEIVABLE
Long term receivables consist of amounts owed to the Town for the developer's portion of costs relating to a long-term construction project. The amount is receivable with interest. Effective interest at December 31, 2023 is 8.20% (2022 - 7.45%). The amount is due at the later of the following dates: May 1, 2024 or four years after the issuance of a construction completion certificate. The certificate of substantial completion was issued September 27, 2021.
7.BANK DEMAND LOAN
To fund the 54 street construction project, The Town has a revolving demand loan available to a maximum of $2,390,000, bearing interest at prime plus 1.00% per annum, secured by a general security agreement covering all assets of the Town. The effecitve interest rate at year end is 8.20% (2022 - 7.45%). At December 31, 2023 $1,986,861 (2022 - $2,006,271) was borrowed against this loan. Annual interest payments are required to be made twelve months after the first advance, with periodic principal payments to be made from receipt of grant funds earmarked for this project.
This loan is associated with the long term receivable described in note 6.
The total cash payments for interest on the bank demand loan paid in 2023 was $157,974 (2022$82,793).
At December 31, 2023 the Town has a revolving demand loan available in the amount of $3,200,000 this is usable in order to fund the Clean EnergyImprovement Tax Program. This is due on demand with interest at the bank's prime lending rate plus 1.00%. As of December 31, 2023 the Town has a $59,790 credit balance (2022 - $26,094).
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
8.EMPLOYEE BENEFIT OBLIGATIONS
Included in accounts payable and accrued liabilities are employee benefits totaling:
Vacation and incentive time
The vacation and bank time liability is comprised of the vacation and overtime that employees are deferring to future years. Employees have either earned the benefits (and are vested) or are entitled to these benefits within the next budgetaryyear.
Personal time
The personal time liabilityis management's estimate of the cost of sick time that has accrued to employees and willbe taken in future years as paid time off. Employees can accrue and carryover up to 320 hours (2022 - 320 hours) of sick time but are not entitled to pay-in-lieu of unused sick time upon termination of their employment. Based on historical information management expects that 34% (202231%) of the accrued sick hours willbe used.
9.SECURITY DEPOSITS
Security deposits consist of financial deposits for private development, rental deposits and deposits on utilityaccounts.
Private development deposits are held by the Town to ensure that the development has been completed to the required specifications. Deposits are for items such as landscaping, fencing, paving and service connections.
Rental deposits are held by the Town to ensure that rental spaces and properties are left clean and in good repair after the rental period.
Utility account deposits are for rental properties where utility bills are in the tenant’s name. Utility deposits are for unpaid utilities.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
10.DEFERRED REVENUE
Inflows and outflows of restricted resources during the year were as follows:
Prepaid local improvement charges are being amortized to revenue over the useful life of the corresponding debentures with a term of 5 years.
Deferred projects are funds received in advance for specific projects and will be recognized as operating revenue or capital revenue in the year the expenditure occurs.
Deferred operating revenue relates to monies received for goods or services which have not yet been delivered, and willbe recognized as revenues when provision of the goods or services is completed.
Deferred capital grants relate to government and other funding received for specific capital projects that are not yet completed, and will be recognized as revenues when the projects are completed in the case of government grants, or on the same basis as the capital asset is amortized in the case of other contributions. Deferred capital grants is comprised of:
TOWN OF ROCKY MOUNTAIN HOUSE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
11.LONG TERM DEBT
The current portion of the long-term debt amounts are $806,843 (2022 - $986,293).
Principal and interest repayments are due as follows:
Debenture debt is repayable to Alberta Capital Finance Authorityand bears interest at rates ranging from 2.03% to 4.91% per annum and mature in periods 2024 through 2047. The average annual interest rate is 3.78% (2022 - 3.96%).
Debenture debt is issued on the credit and securityof the Townof RockyMountain House at large.
The total cash payments for interest on debenture debts paid in 2023 were $376,034 (2022 - $171,256).
An advance for the Green Municipal Fund Loan of $194,100 was received during the year (2022$194,100). Payments are $8,823 (2022 - $3,882) semi-annually including interest at 0.00% per annum. The first payment is due September 22, 2025.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
12.ASSET RETIREMENT OBLIGATION
Landfill
Pursuant to an agreement the Town has accepted partial responsibility for a post closure liability. The Townhas agreed to fund 34.5% of future closure and post closure costs of a landfill.
Closure and post-closure activities include the final clay cover, landscaping, as well as surface and ground water monitoring, leachate control, and visual inspection. A liability for the total obligation, which was incurred pursuant to the agreement, has been accrued.
Undiscounted future cash flows expected are a closure cost in year 2037 of $22,567 with annual post closure activities stating in the year 2037 of $340,831 per year, increasing at an annual inflation rate of 3.5% for 25 years to year 2061. The estimated total liability is based on the sum of discounted future cash flows for closure and post-closure activities for 25 years after closure using a discount rate of 5.28% (2022 - 4.90%) and assuming annual inflation of 3.5% (2022 - 2%). The Town has not designated assets for settling closure and post-closure liabilities.
The accrued liability portion is based on the cumulative capacity used at year end compared the estimated total landfill capacity. The total capacity of the site is estimated at 2.305 million cubic metres. The estimated used capacity of the landfill site is 2.305 million cubic metres. There is no estimated remaining life in years.
Post closure care is estimated to be required until 2061.
Asbestos abatement
The town owns a building which contains asbestos and, therefore, the town is legallyrequired to perform abatement activities upon renovation or demolition of this building.
Abatement activities include handling and disposing of the asbestos in a prescribed manner when it is disturbed.
Undiscounted future cash flows expected are an abatement cost in year 2030 of $250,000. The estimated total liability of $250,000 is based on the sum of discounted future cash flows for abatement activities using a discount rate of 4.90% and assuming annual inflation of 2.00%. The town has not designated assets for settling the abatement activities.
Total asset retirement obligations
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
13.DEBT LIMITS AND DEBT SERVICING LIMIT
Section 276(2) of the Municipal Government Act requires that debt and debt limits as defined by Alberta Regulation 255/00 for the Townof RockyMountain House be disclosed as follows:
The debt limit is calculated at 1.5 times revenue of the municipality excluding transfers from the government of Alberta and Canada for the purposes of capital property(as defined in Alberta Regulation 255/2000) and the debt service limit is calculated at 0.25 times such revenue. Incurring debt beyond these limitations requires approval by the Minister of Municipal Affairs. These thresholds are guidelines used by Alberta Municipal Affairs to identify municipalities that could be at financial risk if further debt is acquired. The calculation taken alone does not represent the financial stability of the municipality. Rather, the financial statements must be interpreted as a whole.
Total debt includes long-term debt less debt charges recoverable. Debt servicing includes principal and interest payment due on long-term debt in the 12 months subsequent to year-end less amounts that are recoverable.
14.EQUITY IN TANGIBLE CAPITAL ASSETS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
15.ACCUMULATED SURPLUS
Accumulated operating surplus consists of internally restricted and unrestricted amounts and equity in tangible capital assets as follows:
16.TRUST FUNDS
The Townof RockyMountain House administers the following trust: 2023 2022 CemeteryPerpetual Care
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
17.CONTRACTUAL RIGHTS, CONTRACTUAL OBLIGATIONS AND CONTINGENCIES
In 2014 the Town entered into a financial contribution agreement with the Rocky Curling Club (the "Club") wherebythe Club agreed to contribute a total of $1,500,000 toward renovations to the curling rink building. In 2018 the Town also advanced the Club $37,100 for exterior renovations. The balance receivable is measured at cost. Annual payments are due in November of each year. There are no terms regarding interest, forgiveness nor security. In 2020, the annual receipt from the curling club was deferred. In 2022 this agreement was extended to a 15 year period. The Future receipts under this agreement are detailed in the table below. Pursuant to a cost sharing agreement, Clearwater Countywill pay50% of anyamounts defaulted bythe Club.
On January 1, 2021 a new agreement between the Town and Clearwater County was signed for the period January 1, 2021 to December 31, 2025. The County committed to make annual payments to the Town calculated as (Town Service Property Tax - County Service Property Tax) x County percentage. In 2023 the payment is $426,300 (2022 - $477,991).
In 2010, the Town and Countyas joint landlords entered into a triple net lease agreement for the lease of a municipally owned building. The monthly payment of $9,243 is shared 50% between the Town and County. The Town's share of the monthly lease payment is $4,621. Estimated maximum future receipts under this agreement are:
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
17. CONTRACTUAL RIGHTS, CONTRACTUAL OBLIGATIONS AND CONTINGENCIES
(Continued)
Contractual Obligations
RCMP Contract
On April 1, 2012 the Town entered into an agreement with the Government of Canada for the employment of the Royal Canadian Mounted Police to provide policing services during the term of the agreement which ends March 31, 2032. The policing services expenses for 2023 are $2,528,484. (In 2022 the Town recognized $2,605,896). The Town received Provincial grants to assist with the cost sharing in the amount of $353,080. (In 2022 the Townrecognized $353,080).
Land Development
The Town has entered in to an agreement to develop a parcel of land. The total project is estimated to cost $4,035,640 (2022 - $4,035,640). The Town has agreed to contribute 46% of total expenditures. As of December 31, 2023, the Town's portion of expenditures made is $1,856,395 (2022 - $1,856,395). The project is anticipated to be completed September 27, 2025.
Lawsuits
From time to time, the Town is a defendant in various lawsuits. When the outcome of a claim against the Town is considered likely to result in a loss and the amount of the loss can be reasonablyestimated, accrued liabilities have been recorded. When the resulting potential losses, if any, cannot be determined or the occurrence of future contingent events is unknown, accrued liabilities have not been recorded.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
18.SALARY & BENEFITS DISCLOSURE
Disclosure of salaries and benefits for municipal officials, the chief administrative officer and designated officers as required byAlberta Regulation 313/2000 is as follows:
1. Salary includes regular base pay, bonuses, overtime, lump sum payments, gross honoraria, compensated absences and anyother direct cash remuneration.
2. Benefits for Council include a communication benefit for cell phones, internet and CPP deductions. Benefits for the CAO includes employer's share of all employee benefits and contributions or payments made on behalf of employees including pension, health care, dental coverage, vision coverage, group life insurance, accidental disability and dismemberment insurance, short-term disabilityplans, professional memberships and tuition.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2023
19.LOCAL AUTHORITIES PENSION PLAN
Employees of the Town of Rocky Mountain House participate in the Local Authorities Pension Plan (LAPP), which is covered by the Alberta Public Sector Plans Act. The Plan serves about 291,259 people and about 437 employers. It is financed by the employer and employee contributions and investment earnings of the LAPP Fund.
Contributions for current service are recorded as expenditures in the year in which theybecome due.
The Town is required to make current and past service contributions to the LAPP of 8.45% (20228.45%) of pensionable earnings up to the year's maximum pensionable earnings under the Canada Pension Plan and 12.23% (2022 - 12.80%) on pensionable earnings above this amount. Employees of the town are required to make current service contributions of 7.45% (2022 - 7.45%) of pensionable salary up to the year's maximum pensionable salary and 11.23% (2022 - 11.80%) on pensionable salary above this amount.
Total current and past service contributions by the Town to the Local Authorities Pension Plan in 2023 were $476,560 (2022 - $453,456). Total current and past service contributions by the employees of the Townto the Local Authorities Pension Plan in 2023 were $424,689 (2022 - $403,745).
The LAPP discloses an actuarial surplus at year end. The 2023 numbers were not available at the time of preparing these financial statements. (2022 - $12.67 billion surplus).
For further information of the amount of LAPP deficiency/surplus information see: www.lapp.ca/page/annual-reports.
20.SEGMENTED DISCLOSURE
The Town of Rocky Mountain House provides a range of services to its ratepayers. For each reported segment, revenues and expenses represent both amounts that are directly attributable to the segment and amounts that are allocated on a reasonable basis. The accounting policies used in these segments are consistent with those followed in the preparation of the financial statements as disclosed in note 1.
Refer to the Schedule of Segmented Disclosure (schedule 6).
General government includes council and other legislative, and general administration. Protective services includes bylaw enforcement, police and fire. Transportation includes roads, streets, walks and lighting. Planning and development includes land use planning, zoning and subdivision land and development. Public health and welfare includes familyand communitysupport. Recreation and culture includes parks and recreation, libraries, museums and halls. Environmental use and protection includes water supplyand distribution, wastewater treatment and disposal, and waste management.
TOWN OF
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023
21.BUDGET RECONCILIATION
The budget information presented in these consolidated financial statements is based on the operating and capital budgets approved bythe Town of RockyMountain House council on January17, 2023.
The reconciliation belowreconciles the approved financial plan to the figures reported in these consolidated financial statements.
Budget $ 15,029,258 Amortization 3,321,414 Government transfers for capital (Schedule 4) (15,538,316) Repayment of long term debt (982,347) Transfers from reserves - capital (1,830,009)
22.COMPARATIVE FIGURES
Certain comparative figures have been restated to conform with the current year's presentation.
23.FINANCIAL INSTRUMENTS
The Town of Rocky Mountain House's financial instruments include cash and cash equivalents, taxes receivable, trade and other receivables, accounts payable and accrued liabilities, accounts payabletangible capital assets, and long term debt. It is management's opinion that the town is not exposed to significant interest or currency risks arising from these financial instruments. Taxes receivables and requisition over/under-levy are compulsory in nature, rather than contractual, however, the town manages risk exposure on these items similar to other receivables and payables.
The Town is exposed to some credit risk with respect to taxes and grants in place of taxes receivables and trade and other receivables. Credit risk arises from the possibility that taxpayers and entities to which the town provides services may experience financial difficulty and be unable to fulfills their obligations. The town is exposed to market price risk from investments in equity instruments whose value fluctuates with changes in quoted market prices.
24.BUDGET AMOUNTS
The budget amounts included in these financial statements have not been audited; accordinglyno assurance is expressed thereon.
25.APPROVAL OF FINANCIAL STATEMENTS
These financial statements are approved byCouncil and management April24, 2024
STATISTICAL INFORMATION (Unaudited)
Assessed Values for General Municipal Purposes of Land and Improvements
For the Year Ended December 31, 2023 (Unaudited)
Property Taxes Levied
Residential
Land and improvements
Linear Property
Machinery and Equipment
Farm Land
Federal Government Taxes in Lieu
Provincial Government Taxes in Lieu
Requisition:
Alberta School Foundation Fund
Westview Lodge
Other Requisition Transfers
Net Taxes Available for Municipal Purposes
Tax
Levied Per Capita
Population Taxes Levied
Taxes Levied Per Capita
Tax Levied Per Dwelling
Total Dwellings
Taxes Levied
Taxes Levied Per Dwelling
Mill Rates
Residential and Farmland Vacant Residential
Non-Residential Commercial Improved Non-Residential Commercial Vacant
Non-Residential Large Business
Non-Residential Large Business - Industrial & Linear
Machinery & Equipment - Large Business
Provincial Grant in Lieu
Taxable Assessments
Residential and Farmland
Vacant Residential
Non-Residential Commercial Improved
Non-Residential Commercial Vacant
Non-Residential Large business
Non-Residential Large Business - Industrial & Linear
Machinery & Equipment - Large Business
Provincial Grant in Lieu
$982,228,490
Total Taxes Receivable Dec. 31 Taxes Receivable - Arrears
Total Property Taxes Collected - Year Levied Other Tax Levies and Collections
Taxes Levied Local Improvements
Percentage of Current Taxes Outstanding by Dec. 31
2023 Top 5 Principal Corporate Taxpayers
Revenues by Function
Salaries, Wages and Benefits
Contracted and General Services For the Year Ended December 31, 2023 (Unaudited)
Materials, Goods and Utilities
Interest
Transfers
Amortization of Tangible Capital Assets
Other Expenses
Gain (Loss) on disposal of tangible capital assets
Gain on dissolution of Rocky Mountain Regional Waste Authority
Government Transfers for
Annual & Accumulated Surplus (Deficit)
$800,000
Accumulated
Beginning of Year
Accumulated Surplus, End of Year
Accumulated Surplus $(200,000)
2023-2019
$140,000,000
$120,000,000
$100,000,000
Excess of Revenues Over Expenditures Change in Net Financial Assets
Acquisition of Tangible Capital Assets Acquisition of Construction in Process
Contributed Tangible Capital Assets
Proceeds on Disposal of Tangible Capital Assets
Amortization of Tangible Capital Assets
Loss (Gain) on Disposal of Tangible Capital Assets
Net use of Supplies Inventories
Net Acquisition of Prepaid Assets
Net Acquisition of Tangible Capital Assets in Progress
Decrease (Increase) in Net Debt
Net Financial Assets, Beginning of Year
Net Financial Assets, End of Year
$50,000,000
$45,000,000
$40,000,000
$35,000,000
Net Financial Assets For the Year Ended December 31, 2023 (Unaudited)
Long Term Debt
For the Year Ended December 31, 2023 (Unaudited)
Tax Supported Debentures
Self Supported Utility Debentures
Total Long Term Debt
Debt Limits:
Total Debt Limit
Total Debt
Amount of Debt Limited Unused
Amount of Debt Servicing Limit Unused Percentage of Debt Service Limit Used Percentage of Debt Limits Used
Debt Servicing Limit Debt Servicing
Total Private Dwellings
Debt Service Limit: Debt Per Capita Debt Per Dwelling
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
2019 - 2023 Percentage of Debt Service Limit Used
Consolidated Tangible Capital Assets
For the Year Ended December 31, 2023 (Unaudited)
In Tangible Capital Assets
Transfers for Operating:
Federal Government
Total Transfers for Operating Transfers for Capital: Other Local Governments Provincial Government
Federal Government
Total Transfers for Capital
Total Government Transfers
Government Transfers
For the Year Ended December 31, 2023 (Unaudited)
Reserves
For the Year Ended December 31, 2023 (Unaudited)
Unrestricted Surplus
Restricted Surplus
Equity in Tangible Capital Assets
Total Accumulated Surplus Restricted Surplus:
Environmental Sustainability Rese Airport - Equipment Water, Sewer and Solid Waste Land Development Off-Site Levies
Deferred Project Reserve
Total Restricted Surplus
2023 Accumulated Surplus
Population of Rocky Mountain House
