Item - 2015.EX1.4

Tracking Status

  • City Council adopted this item on December 11, 2014 without amendments.
  • This item was considered by Executive Committee on December 5, 2014 and was adopted with amendments. It will be considered by City Council on December 11, 2014.

EX1.4 - Operating Variance Report for the Nine-Month Period Ended September 30, 2014

Decision Type:
ACTION
Status:
Adopted
Wards:
All

City Council Decision

City Council on December 11, 2014, adopted the following:

 

1.         City Council approve the budget adjustments detailed in Appendix F to the report (November 21, 2014) from the Deputy City Manager and Chief Financial Officer, to amend the 2014 Approved Operating Budget between Programs and Agencies that have no impact to the 2014 Approved Net Operating Budget.

Background Information (Committee)

(November 21, 2014) Report from the Deputy City Manager and Chief Financial Officer on Operating Variance Report for the Nine-Month Period Ended September 30, 2014
https://www.toronto.ca/legdocs/mmis/2015/ex/bgrd/backgroundfile-73787.pdf
Appendix A - City of Toronto Net Expenditures for Nine Months Ended September 30, 2014 Appendix B - City of Toronto Gross Expenditures for Nine Months Ended September 30, 2014 Appendix C - City of Toronto Revenues for Nine Months Ended September 30, 2014 Appendix D - City of Toronto Complement for Nine Months Ended September 30, 2014 Appendix E - City of Toronto Complement Projections for 2014 Year-End
https://www.toronto.ca/legdocs/mmis/2015/ex/bgrd/backgroundfile-73864.pdf
Appendix F - City of Toronto Budget Adjustments for Nine Months Ended September 30, 2014 Appendix G - City of Toronto Significant City Programs/Agencies Variance Explanations
https://www.toronto.ca/legdocs/mmis/2015/ex/bgrd/backgroundfile-73865.pdf

Background Information (City Council)

(December 10, 2014) Supplementary report from the Deputy City Manager and Chief Financial Officer on 2014 Operating Budget Estimates for Supplementary and Omitted Taxation Revenue (EX1.4a)
https://www.toronto.ca/legdocs/mmis/2015/cc/bgrd/backgroundfile-74043.pdf

Motions (City Council)

Motion to Adopt Item (Carried)

Declared Interests (City Council)

The following member(s) declared an interest:

Councillor James Pasternak - as his spouse works for the Toronto Public Library.

EX1.4 - Operating Variance Report for the Nine-Month Period Ended September 30, 2014

Decision Type:
ACTION
Status:
Amended
Wards:
All

Committee Recommendations

The Executive Committee recommends that:

 

1.         City Council approve the budget adjustments detailed in Appendix F to the report (November 21, 2014) from the Deputy City Manager and Chief Financial Officer, to amend the 2014 Approved Operating Budget between Programs and Agencies that have no impact to the 2014 Approved Net Operating Budget.

 

Decision Advice and Other Information

The Executive Committee requested the Deputy City Manager and Chief Financial Officer to submit a report directly to Council enumerating the reasons for the negative variance on the supplementary taxes.

 

The Executive Committee also requested the City Manager to report:

 

1.         to the Executive Committee, no later than April 22, 2015, on a methodology to present the 2016 budget to Council, without requiring the use of gapping by City divisions, agencies and corporations.

 

2.         to the Executive Committee on January 22, 2015 on Toronto Police Service Traffic Enforcement Officer vacancy rates in 2013 and 2014.

 

3.         in future to the Executive Committee on a quarterly basis on Toronto Police Service Traffic Enforcement Officer vacancy rates.

 

Origin

(November 21, 2014) Report from the Deputy City Manager and Chief Financial Officer

Summary

The purpose of this report is to provide Council with the City of Toronto Operating Variance for the nine-month period ended September 30, 2014 as well as year-end projections and to request Council's approval for amendments to the 2014 Approved Operating Budget between programs that have no net impact to ensure accurate reporting and financial accountability.

 

For the nine-month period ended September 30, 2014, Tax Supported Operations reported a net favourable variance of $112.775 million or 4.1%, as noted in Table 1 below.

 

Table 1

 Tax Supported Variance Summary ($ Millions)

 

 

 

 

 

 

 

 

 

Sept 2014

 

Projected Y/E 2014

 

Over/(Under)

Over/(Under)

 

 

$

%

 

$

%

 

Gross Expenditures

(209.6)

-3.0%

(245.9)

-2.5%

 

Revenues

(96.8)

-2.3%

 

(147.5)

-2.5%

 

Net Expenditures

(112.8)

-4.1%

 

(98.4)

-2.6%

 

The favourable year-to-date variance was driven largely by salary and benefit under-spending from vacant positions and a reduction in caseload for Ontario Works.  Higher than budgeted revenue from permit applications for Toronto Building, Toronto Hydro Dividend Income, Parking Tag and Enforcement and Operations and the Municipal Land Transfer Tax has also contributed to the favourable net variance.  The under-spending was partially offset by over-expenditures for Tax Deficiencies and Transportation Services.

 

Projections indicate that the year-end position will result in a net favourable variance of $98.370 million or 2.6%.  The projected decline in the net favourable variance compared to  the year-to-date is largely driven by net expenditure/revenue changes for Court Services, Parks, Forestry and Recreation, Shelter, Support and Housing Administration, Parking Tag Enforcement and Operations, Supplementary Taxes and Non-Program Revenue Budget contribution from the Toronto Parking Authority's net income sharing to the City.

 

T   Table 2 below summarizes Rate Supported Program net variances:

 

Table 2

Rate Supported Variance Summary ($ Millions)

 

 

 

 

 

 

 

 

 

Sept 2014

 

Projected Y/E 2014

 

 

 

 Over/(Under)

 

Over/(Under)

 

 

Solid Waste Management Services

3.2

(5.3)

 

Toronto Parking Authority

1.8

4.7

 

Toronto Water

2.1

(3.2)

 

Total Variance

 

7.1

 

(3.8)

 

Rate Supported Programs collectively realized a year-to-date unfavourable net variance of $7.146 million or 7.4%.  Solid Waste Management Services reported net over-spending of $3.237 million primarily from under-achieved revenues due to lower paid tonnes at Green Lane, lower tonnes of contractor residual waste and lower than planned Divisional, school and yellow bag fees.  Toronto Water realized a net over-expenditure of $2.128 million owing largely to lower than budgeted revenues from the sale of water as a result of higher than normal rainfall, as well as colder temperatures during the summer months.  In addition, the Toronto Parking Authority reported a net deficit of $1.781 million as a result of weaker than anticipated on-street parking revenues.

 

Rate Supported Programs collectively project year-end net favourable variance of $3.826 million.  This change from the year-to-date actual is primarily driven by Solid Waste Management Services, which is forecasting a favourable year-end variance of $5.323 million.  The year-end net under-spending is driven by savings in salaries and benefits due to vacancies, lower costs for contracted processing, increased Provincial funding for recycling and higher tipping fee revenue from transfer stations.  Toronto Water is projecting a favourable variance of $3.218 million, mostly due to lower than planned salaries and benefits and partially offset by lower sales of water.  The favourable variances noted above will be partially off-set by the Toronto Parking Authority's net deficit of $4.715 million from continued lower on-street revenues.

 

Table 3 below summarizes the vacancy rate for the nine months ended September 30, 2014 and projections to year-end.

 

Table 3

Summary of Approved Complement

(Includes Capital and Operating Positions)

Program/Agency

Year-to-Date

Year-End Projections

Vacancy %

Budgeted Gapping

Vacancy After Gapping

Vacancy %

Budgeted Gapping

Vacancy After Gapping

City Operations

5.7%

2.3%

3.4%

4.1%

2.3%

1.8%

Agencies

4.9%

2.1%

2.8%

2.3%

2.1%

0.2%

Corporate Accounts

4.8%

0.0%

4.8%

-1.5%

0.0%

0.0%

Total Levy Operations

5.3%

2.2%

3.1%

3.1%

2.2%

0.9%

Rate Supported Programs

8.5%

2.3%

6.2%

12.3%

2.3%

10.0%

Grand Total

5.4%

2.2%

3.3%

3.6%

2.2%

1.5%

 

As of September 30, 2014, the City recorded a vacancy rate of 3.3% after gapping for an approved complement of 53,193.2 positions. The forecasted year-end vacancy rate after gapping is projected to be 1.5% for an approved complement of 52,701.2 positions. A more detailed analysis is provided in the Approved Complement Section of this report.

A

Background Information

(November 21, 2014) Report from the Deputy City Manager and Chief Financial Officer on Operating Variance Report for the Nine-Month Period Ended September 30, 2014
https://www.toronto.ca/legdocs/mmis/2015/ex/bgrd/backgroundfile-73787.pdf
Appendix A - City of Toronto Net Expenditures for Nine Months Ended September 30, 2014 Appendix B - City of Toronto Gross Expenditures for Nine Months Ended September 30, 2014 Appendix C - City of Toronto Revenues for Nine Months Ended September 30, 2014 Appendix D - City of Toronto Complement for Nine Months Ended September 30, 2014 Appendix E - City of Toronto Complement Projections for 2014 Year-End
https://www.toronto.ca/legdocs/mmis/2015/ex/bgrd/backgroundfile-73864.pdf
Appendix F - City of Toronto Budget Adjustments for Nine Months Ended September 30, 2014 Appendix G - City of Toronto Significant City Programs/Agencies Variance Explanations
https://www.toronto.ca/legdocs/mmis/2015/ex/bgrd/backgroundfile-73865.pdf

Speakers

Councillor Janet Davis
Councillor Gord Perks
Councillor Shelley Carroll
Councillor Pam McConnell
Councillor Ron Moeser

Motions

1 - Motion to Amend Item (Additional) moved by Councillor David Shiner (Carried)

That the City Manager report to the Executive Committee, no later than April 22, 2015, on a methodology to present the 2016 budget to Council, without requiring the use of gapping by City divisions, agencies and corporations.


2 - Motion to Amend Item (Additional) moved by Councillor Michael Thompson (Carried)

1. That the City Manager report to the Executive Committee on January 22, 2015 on Toronto Police Service Traffic Enforcement Officer vacancy rates in 2013 and 2014.

 

2.  That the City Manager report in future to the Executive Committee on a quarterly basis on these vacancy rates.

 


3 - Motion to Amend Item (Additional) moved by Councillor Ana Bail„o (Carried)

That the Deputy City Manager and Chief Financial Officer submit a report directly to Council enumerating the reasons for the negative variance on the supplementary taxes.


4 - Motion to Adopt Item as Amended moved by Councillor David Shiner (Carried)

That the Item as amended, as it relates to the Toronto Public Library, be adopted.


5 - Motion to Adopt Item as Amended moved by Councillor David Shiner (Carried)

That the Item as amended, as it pertains to the balance of the Item, be adopted.

Declared Interests

The following member(s) declared an interest:

Councillor James Pasternak - As it relates to the Toronto Public Library as his spouse is an employee.
Source: Toronto City Clerk at www.toronto.ca/council