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City optimistic of financial outlook
If all goes well, Penticton could be back to black by year end.
Chief financial officer Doug Leahy detailed the state of the city’s finances during his third-quarter update at Monday’s council meeting, and had encouraging news to offer.
Leahy said that, as of Sept. 30, the city is seeing a $1.9 million surplus as a result of some unexpected savings in the last six months.
RCMP E Division also returned $400,000 to the city under the reconciliation program when Mounties squared up the end of their fiscal year on March 31, and found additional funds to return to the city.
The big savings came in the form of $840,000 from corporate services, which trimmed back staff development and IT operations, in addition to unnamed labour savings. Once year-end allocations occur, those figures will come more in line with the budget, Leahy said.
He added that development services is also expected to be under budget because of consulting fees either not occurring or recovered from a developer.
The South Okanagan Events Centre is also posting a $100,000 surplus to date. “We’re certainly hoping that is going to be the case for the rest of the year,” he said.
Leahy added all departments are tracking to be under or on budget, and the city is also monitoring pool operations to determine baseline budgets for 2012.
The city isn’t out of the woods, he warned, as city revenue is down. Building permits are in the $300,000 range, down $100,000 from projections and in line to be $150,000 short by year end.
Facility rentals are $100,000 under projections, but should correct slightly in the last quarter due to ice rentals at McLaren Park Arena. Cemetery revenues are down $70,000.
A bright point is recreation revenues, which are $112,000 over what was planned because of the Penticton Community Centre reopening.
Development cost charges total $270,000 for the year to date, lower than projected.
“The development cost charges have not come to fruition this year,” he said. “Although this revenue does not flow into operations funds, it is an indication of development activity in the city.”
Operation revenues will also be closer to budget when the final year-end adjustments are made, Leahy said, adding the city is embarking upon the zero-based budgeting process now for the 2012 year.