Healthy cash and investment balances, tax collection and declining long-term debt have put the Mission district in a strong financial position if it needs to borrow, its accountancy manager said. .
Council approved the District’s draft 2020 financial statements on May 3, following the accounting report.
“We’re in a very good financial position right now, considering COVID and how we’ve handled it over the past year,” Coun said. Danny Plecas. “There is a borrowing capacity.
The district reports an annual surplus of over $ 16,700,000, just a slight decrease (less than 1%) from 2019 figures; having $ 3.1 million remaining from the General Operating Fund (almost double from 2019); and adding $ 1.5 million to its reserves, which have grown to nearly $ 70 million.
Also noteworthy is the positive cash flow of nearly $ 70 million, more than $ 30 million more than in 2019, and long-term debt obligations have been reduced significantly over the past 10 years. years, from over $ 17 million in 2011 to $ 3.4 million today. Less than half a percent of the district’s income goes to pay interest on the debt.
|The decrease in the District’s long-term debt over the past 10 years.|
“Put simply, the district has very healthy cash and investment balances and can service ongoing operations even if there were to be some unwanted surprises,” Scott Ross, director of accounting services.
He said the next budget cycle must have an “appropriate cost estimate” for replacing, upgrading and maintaining its infrastructure.
“Aging infrastructure as well as the pressures of developmental growth require significant fiscal funding,” Ross said. “What we can currently afford to do versus what we probably should be doing is our funding gap. Closing this gap will result in better protection of the city’s infrastructure. The development of the waterfront, Silverdale and other growth pressures will have a significant impact on the reserves. “
Ross specifically mentioned the Fraser River sewer crossing project, which may require the municipality to borrow a significant amount to complete it. On April 6, the council authorized the chief financial officer to borrow a maximum of $ 23.5 million if needed, but the district’s costs are currently estimated at just $ 12.5 million.
About 58 percent of the total reserves built up come from water and sewer equipment works.
|Where are the Mission District reserve funds allocated. Capital reserves for water and sewage account for about 58 percent.|
A future unknown is when the Mission Recreation Center will be fully operational again. Staff said it is currently operating at 25% capacity, all adult programming is on hold and they don’t know when the money will hit pre-COVID levels.
While the park’s recreation and culture department is generally a source of revenue for the district, facility closures have required $ 1.3 million to subsidize lost revenue. The nearly $ 5 million contributed by the federal and provincial governments are expected to be used up by the end of 2021.