Council recently approved amendments to the City’s 2020 Operating Budget based on updated estimates for revenue and expenditures. The spring amendments consider the impacts of the COVID19 pandemic, and holds the one per cent tax increase approved in the 2020 budget, adopted on December 19, 2019.
In 2020, Administration is proposing to adjust total operating revenues by approximately $534,000, and total operating expenses by approximately $346,000. Overall, the net financial impact of the regular budget adjustment would be to increase the City’s financial capacity by about $190,000.
COVID-19 Spring Budget Adjustments
Due to the provincial public health orders put in place to contain COVID-19, all municipal facilities are closed to the public. Consequently, the City will see an estimated decrease of $500,000 in revenue in 2020, especially those related to user fees and facility rentals.
In addition to the revenue losses mentioned above, the City is expecting to incur additional expenditures totaling approximately $48,000 in 2020 relating to COVID-19. Combined, the tax supported component of the recommended budget adjustments (both ‘regular adjustments’ at + $190,000 and ‘COVID19 adjustments’ at –$210,000) creates a small shortfall of about $20,000, which will be withdrawn from the City’s Operating Reserve.
“Through the consideration of the overall organization, Council and City administration were able to largely mitigate the negative consequences of the pandemic through effective planning and quick action,” said Mayor Grant Creasey. “This public health crisis is by no means over, so I encourage everyone to continue their diligence in adhering to the physical distancing guidelines and good hygiene practices.”
“Although adjusting staffing levels is never a pleasant task, it was necessary due to the coronavirus pandemic,” said Chief Administrative Officer Matthew Goudy. “Taking this action early has put us in a good position to weather the financial storm over the coming months.”
Every year, municipalities consider adjustments to their annual operating budgets for a number of reasons. Historically, the City of Lacombe makes adjustment relating to:
- School requisitions and other requisitions, once the exact figures being levied are known.
- Approved operating grants.
- New revenue to be received during the year.
- Adjustments based on new information received since budget adoption in the fall.
-Submitted by the City of Lacombe