BUDGET VARIANCE AND PROJECTS UPDATE REPORT TO January 31, 2024

RECOMMENDATION:

THAT the report titled “Budget Variance and Projects Update Report to January 31, 2024” from the Manager of Accounting be received for information.

PURPOSE:

To provide the Committee with information regarding the financial results of to January 31, 2024.

TIME CRITICAL:

Staff provides the Committee with a Budget Variance and Projects Update monthly to provide greater detail and analysis to supplement the Budget Variance Dashboard information available at viewroyal.ca.

EXECUTIVE SUMMARY:

This report and attached schedule are provided to inform the Committee of the financial results of delivering services to the end of January 31, 2024. Prior year actual values are reported to the end of Quarter 1, March 31, 2023. Capital and non-core projects are not listed separately in this report, as Council has yet to confirm the approved list of projects for 2024. If Council or the members of the public wish to view information about 2023 capital and non-core projects, the Budget Variance Dashboard and Financial Plan Insights App accessible at viewroyal.ca displays this information until the next five-year financial plan is adopted in May, 2024.

BACKGROUND:

On July 18, 2023, Council adopted Bylaw No. 1118, a bylaw to amend Financial Plan Bylaw No. 1113, 2023. This report reflects amended budget values for revenue and expense as presented in the amended 2023-2027 Financial Plan. The 2024 budget values are as shown in the 2023-2027 financial plan bylaw and will be updated after Council adopts a new five-year financial plan in May, 2024. The Budget Variance Dashboard provides additional views of the same budget information. The attached schedule informs the Committee of the financial results of delivering services to the end of January 2024, with prior year actual values to March 31 for comparison.

Interested constituents can access the Budget Variance Dashboard through a “Quicklink” on the landing page at www.viewroyal.ca. The Budget Variance Dashboard includes information about the status of 2023 non-core and capital projects along with 2024 operating budget and spending to date. The Dashboard displays year-to-date values (YTD) for the current year, and up to four prior years’ comparative values and is updated weekly.

Please note that the year-to-date values provided are subject to change until finalized for the published financial statements. Also, the values in the dashboard may not match those on the attached consolidated report, as the dashboard reflects segmented operating revenue and expense and specific project financial information, rather than the full consolidated budget.

DISCUSSION:

Consolidated Budget Variance and Projects Update Report

Revenues and expenses to date are within expected variances, with the exceptions and comments noted below.

Consolidated Revenue

Schedule A – Consolidated Budget Variance shows revenue on a consolidated basis, which means that both operating revenue and capital sources of funding are added together in the same format as shown in the amended five-year financial plan bylaw. Forty-four percent or $20.8 million of the total 2024 budgeted revenue and transfers comes from operating activities. At January 31, 2024 approximately $310,000 (1.5%) in total operating revenue has been received or is receivable. Included in 2024 YTD revenue are the following:

A determination as to whether View Royal is on track to meet its total revenue target will become clearer in the coming months.

Consolidated Expense

Like revenue, expense is shown on Schedule A on a consolidated basis – operating, capital expenses, and transfers are added together. Thirty-eight percent or $18.2 million of the total 2024 consolidated expense is budgeted for operations. As of January 31, 2024, approximately 5.1% of total operating expense ($926,000) has been spent or is payable.

Generally, operating expense is spread evenly throughout the year such that at the end of January about 92% of the budget should remain for each of the service categories. Schedule A shows that most operational services have the expected level of budget or more remaining, which allows for timing differences, year-end accruals, and other project or contingency expenses. The exception is recreation and culture services which reflects the full Quarter 1, 2024 requisition payment to West Shore Parks and Recreation.

SUSTAINABILITY/CLIMATE CHANGE IMPACTS:

This matter has no significant sustainability or climate change impacts.

FINANCIAL IMPLICATIONS:

Staff will continue to monitor financial results to ensure delivery of services and projects within the allocated budgets. Where applicable, staff will seek budget amendment approval in due course once the final funding requirements are known.

ALTERNATIVES:

N/A

CONCLUSION:

The Town’s financial results of operations and projects to date are within acceptable variances from budget, with highlights noted for the Committee’s information.

Due to timing differences between internal reporting timelines and invoices from vendors, there may exist variances between reported costs and final costs of some projects. As invoices are processed, a more complete calculation of actual variances will be made.

Cost overruns may be offset by deferring other projects with the same funding source, to the extent that there are no other significant impacts to levels of service. Should corrective measures be necessary, staff will inform Council of the effect, if any, on service levels or project completion timelines.

ATTACHMENTS: Schedule A: 2024 Consolidated Budget Variance