ST. PAUL - The 2019 audited financial statement appeared to offer no surprises for County of St. Paul councillors as they approved the year end report indicating a shortfall of $1.5 million in revenue compared to operational expenditures with no questions asked. However, given that the actual was far less than a budgeted shortfall of $2.8 million, the county is taking it as a win.
“I don’t think there’s too many surprises here. It’s kind of where we knew we were at,” Reeve Steve Upham said.
Following the meeting, CAO Sheila Kitz said the municipality had expected to move $3.27 million into operations from reserves earmarked for future expenditures to balance its operating and capital budget in 2019. As it turned out, it was only necessary to move over $1.1 million from the reserve fund to record a deficit of $42,709 on the books for 2019.
“The County is quite happy with how the audited financial statements look for 2019. We did the majority of the planned work for the year and ended the year in a better position than what was budgeted,” Kitz said following the meeting.
With 2020 well underway, Kitz said the county has an unrestricted surplus is $6,707,311 and the restricted surplus is now sitting at $9,133,230. This equals approximately 71 per cent of the annual net municipal taxes of $22,402,158 in 2019, which puts on the county on solid footing going forward, according to the county’s auditor Shawn Warrington of Synergy Chartered Accountants.
“Last year it was at about 75 per cent, so there’s a bit of a diminishing factor going on there. Just given the notion that we had to use some of that up this year, it does show you have the funds available in an unforeseen situation in the future,” Warrington told council, citing the oil industry crash and the COVID-19 public health crisis as creating much uncertainty as the municipality moves through 2020.
“Having surpluses at this level is healthy. You have the ability to overcome these challenges, he said, adding “It shows you the county is saving. It’s proactively keeping money on hand to continue to provide quality infrastructure and high levels of service, but at the same time you are also spending money now instead of saving it all for later. Healthy? Yes. Responsible? Yes.”
The total accumulated surplus at the end of 2019 for the County, which includes equity in tangible capital assets, is $127,016,214 which is an increase of $2,323,691 over the prior year.
Warrington warned Alberta municipalities may have little alternative but to dip into savings going forward with so much provincial funding being redirected in light of the current economic situation.
Legislative expenses incurred in 2019 equalled $617,437 compared to the previous year’s $566,162. Warrington attributed the difference to an increase in council fees paid to elected officials to compensate for the loss of the one-third federal tax exemption as of Jan. 1, 2019.
The compensation breakdown for each county council member including salary, benefits and allowances is as follows: Reeve Steve Upham - $87,654, Deputy Reeve Maxine Fodness - $74,268, Laurent Amyotte - $75,075, Dale Hedrick - $62,277, Cliff Martin - $61,251, Kevin Wirsta - $76,659, and Darrell Younghans - $52,685.
Warrington described “a slight increase” in administration expenses, $3,324,172 this year compared to $3,287,627 in 2018, as the result of the county operating with an interim CAO for a portion of the year. The financial statements indicate CAO Sheila Kitz’s salary plus benefits and allowances for the year as $128,266, down from the 2018 figure of $205,508 due to a sick leave. Interim CAO Tim Mahdiuk received $129,646. The year-end report also indicates a total cost of $629,096 for six management positions.
Big ticket items
The big spend on the county’s financials accounting for $17.6 million was roads, streets, walks and lighting. Over budget by about $600,000, Warrington attributed the excess to salaries and contracted services resulting from a “more favourable construction season” than the prior year where $15.6 million was spent.
As a whole, the expenses came in just below the budgeted $29 million at $28.6 million. Lower economic activity in the region resulted in less subdivision and planning costs. Agriculture services also were under budget at $822,643. Family and Community Services exceeded budget by approximately $29,000, finishing the year at $400,656.
On the revenue side, net municipal taxes were consistent with budget at just shy of $22.5 million. User fees and sales of goods at slightly over $2.3 million was ahead of budget but lower than the previous year due to a “decrease in sales to the oilfield companies and lower activity” as whole in the county, according to Warrington.