Westmount in a very
solid financial position
A review of the 2017 audited financial results
By Kathleen Kez, Commissioner of Finance, City of Westmount
Recently you may have read about the independent audit of the City of Westmount’s financial statements. This audit for the year 2017 was completed by the firm Raymond Chabot Grant Thornton. The firm gave a “clear opinion”, meaning there were no discrepancies found. This was the result of the budget and planning from the previous Council. As the Commissioner of Finance and member of the Finance and Administration committee, it is important to me that residents understand that we are in a very solid financial position and have a strong base to build upon.
Some key points of the Audited Financial statements are that the 2017 Operating Surplus was $796,274 compared to $1,346.227 in 2016. This Operating Surplus is very reasonable and came very close to the amount that was projected in September 2017, $626,600.
… it is important to me that residents understand that we are in a very solid financial position and have a strong base to build upon.
I am also happy to report that as at December 31, 2017, Westmount is in a net asset position, meaning its financial assets are higher than its financial liabilities. The City is in a Net Financial Asset situation of $11M.
Upon closer examination of the 2017 Financial Report, the following are some of the revenue and expenses items, which had significant variances from that budgeted, which contributed to the surplus.
Some of the higher revenues are due to the increase of Duties on Transfers (welcome tax) amounting to $9M, which represents a favourable variance of $3.7M over the budget of $5.3M.
Permit Revenues also went up significantly totalling $1.4M compared to $740K budgeted, which is largely due to an increase in house renovation projects.
Property taxes came to a total of $86.7M versus $86.1M budgeted (favourable variance of $577K). This is largely due to the added value to the property role because of renovations and new construction.
‘Permit Revenues also went up significantly totalling $1.4M compared to $740K budgeted, which is largely due to an increase in house renovation projects.’
Interest Revenue also went up due to an increase of $160K in tax arrears and a $221K increase in interest revenues.
The category titled Other Revenues also went up. This category includes items such as: vehicle and equipment disposal, accounting corrections, supplier discounts, insurance revenues, various reimbursements, etc. Many of these items are budgeted on past actuals and are difficult to predict. For example, when the City bought new vehicles, it disposed of the old ones, which resulted in an unforeseen gain of $266K. This amount was not budgeted for.
Parking Revenues went down from $3.5M budgeted to $2.9M. This is largely due to the fact that parking hours were cut in the East end of town. On Greene Ave, instead of charging up to 9 pm, we charge until 6 pm. On St. Catherine and the Tupper lots we started charging at 9 am instead of 7 am.
Some of the expenses, which were higher than anticipated, include snow removal which went up to $1.3M from $775K budgeted. Pay-As-You-Go (our method of funding capital works) was higher than budgeted by $135.4K. Lawsuit settlement costs and professional fees in the negotiation of Bill 15 went over budget by $900K.
‘Some of the expenses, which were higher than anticipated, include snow removal which went up to $1.3M from $775K budgeted.’
Also, the budget strategy to use $3.3M of the appropriated surplus to pay for a portion of the debt and other expenses was not used, as there was no need as sufficient additional revenues were generated.
The Financial Report and the Auditor’s Report have been tabled by the Treasurer and have been forwarded to the Minister of Municipal Affairs and Regions.
We have now begun the process of planning for the 2019 Capital and Operating budgets and will share with you more information in the coming months. The Westmount share of the Agglomeration was increased by 6.7% this year, which we continue to believe was an unreasonable increase. Mayor Smith is working with the Association of Suburban Mayors on improving the budget process with the Agglomeration of Montreal to ensure we pay only our fair share.Feature image: Dave Dugdale via StockPholio.net
Kathleen Kez is the Westmount City Councillor for District 8, the Commissioner of Finance and a Member of the Finance and Administration Committee.
You may reach her at 514 989-5078 or email@example.com