Item - 2024.EX19.17

The Executive Committee recommends that:

1. City Council direct that the 2021 and 2022 operating surpluses totalling $450,458 from six Arenas (George Bell, William H. Bolton, McCormick, Forest Hill, Ted Reeve, North Toronto [2021] and North Toronto [2022]) be payable to the City of Toronto and be used, in part, to fund the operating deficit of $115,361 for Moss Park Arena, resulting in a net operating surplus of $335,097 prior to the contribution to the Arena Boards of Management Vehicle and Equipment Replacement Reserve (XQ1705), as illustrated in Appendix A to the report (November 26, 2024) from the Chief Financial Officer and Treasurer.

2. City Council direct the excess of the actual operating net surplus balance of $335,097 over the 2021 and 2022 budget equating to $324,937, be allocated to the Arena Boards of Management Vehicle and Equipment Replacement Reserve (XQ1705) and the remaining $10,160, be retained by the City as illustrated in Appendix A to the report (November 26, 2024)  from the Chief Financial Officer and Treasurer.

On an annual basis, the City of Toronto receives the audited financial statements from eight Arena Boards of Management (Arenas). The audited financial statements assist the City to determine whether additional operating subsidy payments need to be provided to or clawed back from the Arenas to settle their operating deficits or surpluses. City staff report annually on the Arenas' operating surpluses and deficits once the respective Boards financial statements have been audited and approved by Council. The audited financial statements are based on the Public Sector Accounting Board (PSAB) requirements for government not-for-profit entities while the operating deficits or surpluses align with the modified cash basis of accounting.

This report recommends the settlement of seven of the Arenas' operating surpluses and deficits based on their audited financial statements for the year ended December 31, 2022, with operating surpluses payable to the City and operating deficits funded by the City upon Council’s approval.

This report also recommends the settlement of North Toronto Arena's operating surplus based on the audited financial statements for the year ended December 31, 2021, with operating surplus payable to the City upon Council's approval. When City staff prepared the Arena Boards settlement for the fiscal year ended on December 31, 2021, the 2021 audited financial statements for North Toronto were not readily available to be included as part of the settlement process.

The 2020, 2021 and 2022 audited financial statements for Leaside Memorial Community Gardens Arena will be presented in a separate report for consideration and approval in first quarter of 2025.

While normally the prior year-end settlement reports for both Association of Community Centres and Arena Boards are submitted together to City Council in the following year, the 2022 settlement report for Arena Boards was delayed due to delays in completing the 2022 audits. City staff will present the 2023 Settlement Reports for both Association of Community Centres and Arena Boards at the first opportunity to the City Council for consideration and approval once the 2023 audit is completed.