The city is reporting it finished 2013 with a surplus of $2 million – approximately three per cent of the city’s operating budget.
Coun. Andy Adams said the surplus reflects increased investment in Campbell River.
“Our financial outlook is much better than expected, a sign that Campbell River has weathered the financial challenges of the past six years. We are now seeing investor confidence in our community,” said Adams, who holds the finance portfolio for council. “In particular, it’s very good news that the high value of building permit revenues – $182,000 more than expected – reflects a positive business environment.”
Adams said staff positions at city hall not being filled were a huge factor in the surplus.
“Prolonged, unforeseen staff vacancies were the single largest contributor to the 2013 surplus, amounting to $678,000, but at a cost,” Adams said.
“The demand for experienced, skilled staff between local governments is extremely competitive and a number of our well-trained staff have been recruited to move elsewhere. We are also finding it difficult to fill positions as many local governments throughout B.C. and Canada are challenged by the increase in retirements, creating a shortage of skilled people available to fill positions. The savings provided by these vacancies were only a short-term gain because having the remaining staff overloaded is not a sustainable situation.”
The city also saved $224,000 in the RCMP contract, and $143,000 in interest payments from the Municipal Finance Authority.
The 2013 budget also included a 3.91 per cent residential tax increase. That budget was just narrowly approved by council, with a 4-3 margin.
Councillors Ron Kerr and Larry Samson, as well as Mayor Walter Jakeway, opposed the financial plan while councillors Adams, Claire Moglove, Ryan Mennie and Mary Storry approved the budget.
The city is transferring $56,000 of the surplus to the snow and ice control reserve to cover bad weather years and $82,000 to the uninsured liability and legal reserve to cover successful claims against the city. A further $378,000 will go into the employee sick and vacation leave reserve.
As per Council’s policy, the 2013 remaining surplus of $1,490,672 will be transferred to the Financial Stabilization Reserve.
Adams said council, at the time of 2013 budget planning, had no way of foreseeing how much of surplus would emerge.
“Many of the elements that contributed to the surplus were not, and could not have been anticipated, and staff always take a conservative approach in making projections to ensure we have sufficient revenues to operate according to the budget that council has adopted,” Adams said. “The bottom line is that this is very good news for Campbell River.”