County budget – the good news

By Cecilia Nasmith

Northumberland County finance director Glenn Dees had good news to share at the May county council meeting with his review of the 2018 draft audited financial statements.

Every budget has its challenges, but the 2018 Northumberland budget also had a goodly share of positive highlights.

Net financial assets (cash and items that will be turned into cash like accounts receivable) have improved by 16% since 2010, Dees reported, and there is a continued positive trend of increased accumulation of surplus. The 2018 amount of $189.6-million compares with $119.8-million in 2010.

Cash and investments in 2018 have risen about $500,000 from the year before, and by more than $50-million since 2009. At the same time, long-term debt decreased by $571,000 from the previous year.

The $173-million net book value of assets increased by $10.2-million over 2017. This would include land, buildings, equipment, vehicles and land improvements, but roads and bridges do account for 60% of these assets.

“The largest liability we have on our statement of financial position is unfunded landfill closures and post-closure liability,” Dees said.

This amount is $21.2-million, though that is down by $1.5-million from 2017.

Reserves, an item the county is committed to, stand at $53.5-million (up $6-million from 2017, and up from the $10-million amount reported for 2005). These provide flexibility for financing future projects and initiatives, Dees said – for example, he expects $13-million will go toward the redevelopment of the Golden Plough Lodge from reserves.

Accumulated surplus stands at $136-million (up $6.4-million from 2017).

Actual 2018 revenues of $114.3-million were $4.3-million more than budgeted. Most of that comes from taxation ($54.3-million), followed by provincial-government grants ($37.9-million) and user charges ($11.2-million).

One troubling item here is that provincial-government grants are the second-biggest revenue source, Dees said, since a new party has taken over Queen's Park with new ideas.

“Changes from the province will create some significant challenges,” he predicted.

For now, however, total revenues are up by $7.2-million over 2017.

Actual expenses of $102-million were $2-million more than budgeted, and up by $6.8-million over 2017. The three biggest items under expenses are salaries and budgets $40.6-million), external transfers such as program-delivery costs ($25.7-million) and materials ($17.9-million).

Breaking down expenses according to what services costs, the three biggest items are social and family services, including long-term care (34%), transportation (16%) and health services (14%).

Long-term debt decreased by $600,000, though a new debenture was issued for the paramedic power-lift stretchers. Anticipated 2020 debentures include the Roseneath emergency-services base and the Brighton landfill expansion.

Total debt of $7.7-million is well below the annual repayment limit set by the Ministry of Municipal Affairs, Dees reported.

He offered a few summary remarks, referring to the continued positive trend in the overall financial position and the continuing challenge with asset renewal.

Another continuing challenge is circumstances that are out of anyone's hands. For example, fluctuating world and market conditions affect what the Material Recovery Facility can bring in as revenue. Excessively wet weather causes leachate at the landfill and excessively snowy weather drains the winter-maintenance budget.

Sometimes there's a silver lining, he added. Less waste is coming into the landfill, meaning less revenue from tipping fees. This is due in large part to private transfer stations now operating within the county. However, this means Northumberland's one remaining landfill gets used up at a slower rate, effectively extending its lifespan.

“Significant provincial-funding reliance means risks from upcoming provincial policy changes,” he warned.

While the debt is under control, he continued, “we need to continue strategies under the long-term financial-planning framework focusing on sustainability and fiscal responsibility.”