The Town of Banff ended 2016 in the black, with an estimated $682,000 surplus.
At a council meeting Monday (April 10), administration sought input on how to allocate the unrestricted surplus, other than $412,702 required to reach the cap on the budget stabilization reserve.
The finance team’s preferred option was to transfer $412,700 to the budget stabilization fund – essentially a rainy day account – and put the balance of $269,000 into general capital reserves.
Council agreed to transfer $412,700 to the budget stabilization fund, but Councillor Brian Standish managed to convince his council colleagues to allocate the $269,000 to fire and fleet reserves, with the remaining balance of that going to general capital reserve.
“I really struggle with this,” he said, noting the fire and fleet reserves show annual contribution shortfalls for 2017.
“Doesn’t it make more sense to clear up the small ones, fire and fleet, and then put the extra surplus into general capital? If it was my money, that’s what I would do.”
The most recent analysis of the capital reserve balances identified annual contribution shortfalls for 2017 of $141,717 for general capital, $187,000 for fire and $32,800 for the fleet reserve.
Direction in Banff’s financial plan is to transfer any unrestricted surplus into the budget stabilization reserve until the undedicated balance in the reserve reaches a balance equal to two per cent of the following year’s total expenses, excluding amortization.
The target balance in the reserve for 2017 is calculated at $669,885. The current undedicated balance in the budget stabilization reserve is $257,183, meaning $412,702 is required to fully fund the reserve to its target level.
Town administration plans to present the 2016 year-end financial statements at council’s April 24 meeting, with a full variance report explaining where the surplus came from.
