SUPPORTS ITEM NO. 6
CS&B COMMITTEE AGENDA
APRIL 25, 1996
Office of the Director of Finance
Hugh Creighton, Director of Finance
Sam Kuzmick, Director of Operations Support
April 15, 1996
Mayor P. Owen
and Members of Council
It is my pleasure to submit the Auditors' Report and the
Financial Statements of the City of Vancouver for the year ended
December 31, 1995. These financial statements are prepared by the
Accounting Services with the assistance of other staff of Corporate
Services.
The statements reflect all civic operations for the 1995 fiscal
year. I have summarized below, by Fund, certain information on those
matters that I feel may be of particular interest to Council.
REVENUE FUND
The Revenue Fund accounts for the general operations of the City.
Revenue for the year totalled $549.0 million and expenditures amounted
to $548.7 million, resulting in an excess of revenue over expenditure
of $0.3 million. Included in revenues were transfers of $7.0 million
from the Property Endowment Fund and $8.1 million from the Sinking
Fund. This surplus is transferred to Revenue Surplus, which now
stands at $4.3 million. This balance in Revenue Surplus is at a
historically low level.
The collection of current taxes amounted to $630.9 million or
97.71% of the total current tax levies. Arrears of taxes which
totalled $22.1 million at the beginning of 1995 were reduced by
receipts of $15.1 million during the year or 68.3%. The following
summary indicates the total receipts on a percentage basis of both
current and arrears of taxes over the last five years:
1995 1994 1993 1992 1991
Total receipts of current
taxes as a percentage of
current levy 97.71% 97.79% 97.45% 97.36% 97.75%
Total receipts on current
and arrears as a percent-
age of current levy 100.05% 100.47% 100.27% 99.61% 100.13%
Tax arrears as at December 31, 1995 totalled $23.4 million, an
increase of $1.3 million compared to tax arrears as at December 31,
1994. As of the date of this report, the arrears have been reduced by
approximately $8.3 million. Basically, tax collections are stable.
The City earned $11.5 million on short-term investments of the
operating, capital and reserve funds, a decrease of $0.2 million from
1994, reflecting a decrease in funds available for investment. Most
interest earnings go to general revenues and result in lower property
taxes.
CAPITAL FUND
The Capital Fund accounts for all properties and equipment required
for civic use and the related long term debt and funding sources.
During 1995, the City expended $180 million on capital works which was
a reduction from 1994, primarily due to the completion of the Library
Square project. The following schedule summarizes these expenditures
by funding sources.
1995 1994
(000) (000)
Capital Fund
By-law funds (borrowed)
- General $ 61,268 $ 78,037
- Local Improvement 3,076 3,342
Revenue budget provision
for capital 28,608 37,218
Revenue Fund
Reserves 8,079 10,968
Operations 6,764 5,790
Other Funds 207 576
Senior Governments 12,364 4,197
Property Endowment Fund 718 30,448
Capital Financing Fund 7,045 16,921
Mortgage 13,603 31,163
Other 38,592 15,128
$180,324 $233,788
In 1995, the City issued $50 million of debentures to finance
capital works. Also local improvement debentures in the amount of
approximately $2.0 million were issued and sold to the Sinking Fund.
For purposes of comparison, the gross debenture debt outstanding
historically has been as follows:
Dollars of the Day Constant 1995 Dollars
(000) (000)
1980 $195,035 $397,272
1985 283,578 403,981
1990 382,808 448,888
1995 464,314 464,314
SINKING FUND
This Fund accounts for the accumulation of actuarial instalments
generated from tax levies, which together with the interest earned
thereon, provides for the retirement of the City's sinking fund debt
at maturity.
Securities held as Sinking Fund investments at December 31, 1995
amounted to $166.3 million. The Sinking Fund invests in City of
Vancouver debentures and short term money market investments.
In 1995, $26.8 million was paid from the Revenue Fund into the
Sinking Fund for current instalments, which, together with other
income of the Fund of $15.3 million, amounted to total revenue for the
year of $42.1 million. After providing $34.4 million for the
actuarial requirements of the Fund and sundry costs of $0.2 million,
the surplus was $7.5 million. Council has appropriated this surplus
for the general operations of the Revenue Fund in 1996.
PROPERTY ENDOWMENT FUND
This Fund accounts for properties of the City not required for
civic use. The financial transactions are accounted for on a
commercial basis and income includes gains or losses on disposal of
property.
During 1995, $7.0 million was transferred to the Revenue Fund to
support general operations, and an equal amount will be transferred in
1996.
These financial statements are provided for your information.
Respectfully submitted,
H.E. Creighton
Director of Finance