Please note:  These minutes are yet to be confirmed as a true record of proceedings

CITY OF BUSSELTON

MINUTES FOR THE Finance Committee MEETING HELD ON 10 June 2020

TABLE OF CONTENTS

ITEM NO.                                        SUBJECT                                                                                                                              PAGE NO.

1....... Declaration of Opening and Announcement of Visitors. 2

2....... Attendance. 2

3....... Public Question Time. 2

4....... Disclosure Of Interests. 2

5....... Confirmation Of Minutes. 3

5.1          Minutes of the Finance Committee Meeting held 11 March 2020. 3

6....... Reports. 4

6.1          LIST OF PAYMENTS MADE - APRIL 2020. 4

6.2          FINANCIAL ACTIVITY STATEMENTS - YEAR TO DATE AS AT 30 APRIL 2020. 21

6.3          APPLICATION FOR RATE EXEMPTION - THE FREE REFORMED CHURCH OF BUSSELTON.. 51

7....... General Discussion Items. 69

7.1          PORT GEOGRAPHE MARINA SEABED RATES. 69

8....... Next Meeting Date. 70

9....... Closure. 70

 


Finance Committee                                                             3                                                                         10 June 2020

MINUTES

 

MINUTES OF Finance Committee HELD IN the WONNERUP Committee Room, Administration Building, Southern Drive, Busselton, ON 10 June 2020 AT 9.00am.

 

1.               Declaration of Opening and Announcement of Visitors

The Deputy Presiding Member opened the meeting at 9.03am.

 

2.               Attendance 

Presiding Member:

 

Members:

 

Cr Paul Carter

Cr Phill Cronin – Deputy Presiding Member

Cr Grant Henley

Cr Sue Riccelli

Cr Jo Barrett-Lennard

 

Officers:

 

Mr Mike Archer, Chief Executive Officer

Mr Tony Nottle, Director, Finance and Corporate Services

Mr Paul Sheridan, Manager, Financial Services

Mr David Nicholson, Rates Coordinator

Ms Melissa Egan, Governance Officer

 

Apologies:

 

Nil

 

3.               Public Question Time  

Nil

 

4.               Disclosure Of Interests

Nil

 

 

9.05am:                At this time, Mr Archer and Mr Nottle entered the meeting.

 


 

5.               Confirmation Of Minutes

5.1             Minutes of the Finance Committee Meeting held 11 March 2020

COMMITTEE DECISION

F2006/020               Moved Councillor J Barrett-Lennard, seconded Councillor S Riccelli

That the Minutes of the Finance Committee Meeting held 11 March 2020 be confirmed as a true and correct record.

CARRIED 4/0

 


Finance Committee                                                             5                                                                         10 June 2020

6.               Reports

6.1             LIST OF PAYMENTS MADE - APRIL 2020

STRATEGIC GOAL

6. LEADERSHIP Visionary, collaborative, accountable

STRATEGIC OBJECTIVE

6.1 Governance systems, process and practices are responsible, ethical and transparent.

SUBJECT INDEX

Financial Operations

BUSINESS UNIT

Financial Services

REPORTING OFFICER

Manager Financial Services - Paul Sheridan

AUTHORISING OFFICER

Director Finance and Corporate Services - Tony Nottle

NATURE OF DECISION

Noting: the item does not require a decision of Council and is simply for information purposes and noting

VOTING REQUIREMENT

Simple Majority

ATTACHMENTS

Attachment a   List of Payments for April 2020  

 

COMMITTEE RECOMMENDATION AND OFFICER RECOMMENDATION

F2006/021               Moved Councillor J Barrett-Lennard, seconded Councillor P Cronin

That the Council notes payment of voucher numbers M117991 – M118049, EF070825 – EF071671, T007509 – T007511, DD004087 – DD004119 together totalling $7,644,763.88

CARRIED 4/0

 

EXECUTIVE SUMMARY

This report provides details of payments made from the City’s bank accounts for the month of April 2020, for noting by the Council and recording in the Council Minutes.

 

BACKGROUND

The Local Government (Financial Management) Regulations 1996 (the Regulations) requires that when the Council has delegated authority to the Chief Executive Officer to make payments from the City’s bank accounts, that a list of payments made is prepared each month for presentation to, and noting by, the Council.

OFFICER COMMENT

In accordance with regular custom, the list of payments made for the month of April 2020 is presented for information. 

Statutory Environment

Section 6.10 of the Local Government Act 1995 and more specifically Regulation 13 of the Regulations refer to the requirement for a listing of payments made each month to be presented to the Council.

Relevant Plans and Policies

There are no relevant plans or policies to consider in relation to this matter.

Financial Implications

There are no financial implications associated with the officer recommendation.

Stakeholder Consultation

No external stakeholder consultation was required or undertaken in relation to this matter.

Risk Assessment

An assessment of the potential implications of implementing the officer recommendation has been undertaken using the City’s risk management framework, with risks assessed taking into account any controls already in place. No risks of a medium or greater level have been identified.

Options

Not applicable.

CONCLUSION

The list of payments made for the month of April 2020 is presented for information.

TIMELINE FOR IMPLEMENTATION OF OFFICER RECOMMENDATION

Not applicable.

 


Finance Committee

7

10 June 2020

6.1

Attachment a

List of Payments for April 2020

 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


Finance Committee                                                             31                                                                      10 June 2020

9.16am:                At this time, Cr Carter entered the meeting.

 

9.23am:                At this time, Mr Archer left the meeting.

 

9.28am:                At this time, Mr Archer re-entered the meeting.

 

6.2             FINANCIAL ACTIVITY STATEMENTS - YEAR TO DATE AS AT 30 APRIL 2020

STRATEGIC GOAL

6. LEADERSHIP Visionary, collaborative, accountable

STRATEGIC OBJECTIVE

6.1 Governance systems, process and practices are responsible, ethical and transparent.

SUBJECT INDEX

Financial Services

BUSINESS UNIT

Financial Services

REPORTING OFFICER

Manager Financial Services - Paul Sheridan

AUTHORISING OFFICER

Director Finance and Corporate Services - Tony Nottle

NATURE OF DECISION

Executive: substantial direction setting, including adopting strategies, plans and policies (excluding local planning policies), tenders, setting and amending budgets, funding, donations and sponsorships, reviewing committee recommendations

VOTING REQUIREMENT

Simple Majority

ATTACHMENTS

Attachment a   Investment Report April 2020

Attachment b    Statement of Financial Activity April 2020  

 

COMMITTEE RECOMMENDATION AND OFFICER RECOMMENDATION

F2006/022               Moved Councillor P Carter, seconded Councillor S Riccelli

That the Council receives the statutory financial activity statement reports for the period ending 30 April 2020, pursuant to Regulation 34(4) of the Local Government (Financial Management) Regulations.

CARRIED 5/0

 

EXECUTIVE SUMMARY

Pursuant to Section 6.4 of the Local Government Act 1995 (the Act) and Regulation 34(4) of the Local Government (Financial Management) Regulations 1996 (the Regulations), a local government is to prepare, on a monthly basis, a statement of financial activity that reports on the City’s financial performance in relation to its adopted / amended budget.

 

This report has been compiled to fulfil the statutory reporting requirements of the Act and associated Regulations, whilst also providing the Council with an overview of the City’s financial performance on a year to date basis for the period ending 30 April 2020.

 


 

BACKGROUND

The Regulations detail the form and manner in which financial activity statements are to be presented to the Council on a monthly basis, and are to include the following:

 

·    Annual budget estimates

·    Budget estimates to the end of the month in which the statement relates

·    Actual amounts of revenue and expenditure to the end of the month in which the statement relates

·    Material variances between budget estimates and actual revenue/expenditure (including an explanation of any material variances)

·    The net current assets at the end of the month to which the statement relates (including an explanation of the composition of the net current position)

 

Additionally, and pursuant to Regulation 34(5) of the Regulations, a local government is required to adopt a material variance reporting threshold in each financial year. At its meeting on 31 July 2019, the Council adopted (C1907/131) the following material variance reporting threshold for the 2019/20 financial year:

 

That pursuant to Regulation 34(5) of the Local Government (Financial Management) Regulations, the Council adopts a material variance reporting threshold with respect to financial activity statement reporting for the 2019/20 financial year as follows:

 

·    Variances equal to or greater than 10% of the year to date budget amount as detailed in the Income Statement by Nature and Type/Statement of Financial Activity report, however variances due to timing differences and/or seasonal adjustments are to be reported on a quarterly basis; and

·    Reporting of variances only applies for amounts greater than $25,000.

OFFICER COMMENT

In order to fulfil statutory reporting requirements and to provide the Council with a synopsis of the City’s overall financial performance on a year to date basis, the following financial reports are attached hereto:

 

Statement of Financial Activity

This report provides details of the City’s operating revenues and expenditures on a year to date basis, by nature and type (i.e. description). The report has been further extrapolated to include details of non-cash adjustments and capital revenues and expenditures, to identify the City’s net current position; which reconciles with that reflected in the associated Net Current Position report.

 

Net Current Position

This report provides details of the composition of the net current asset position on a full year basis, and reconciles with the net current position as per the Statement of Financial Activity.

 

Capital Acquisition Report

This report provides full year budget performance (by line item) in respect of the following capital expenditure activities: 

 

·   Land and Buildings

·   Plant and Equipment

·   Furniture and Equipment

·   Infrastructure

 


 

Reserve Movements Report

This report provides summary details of transfers to and from reserve funds, and associated interest earnings on reserve funds, on a full year basis. Additional reports and/or charts are also provided as required to further supplement the information comprised within the statutory financial reports.

Comments on Financial Activity to 30 April 2020

The Statement of Financial Activity (FAS), for the year to date as at 30 April 2020 shows an overall Net Current Position of $8.4M as opposed to the amended budget of ($14.2M), a positive difference of $22.6M. 

 

The following summarises the major cash variances that appear on the face of the FAS, which in accordance with Council’s adopted material variance reporting threshold, collectively make up the above difference:

 

Description

2019/20
Actual YTD

2019/20
Amended
Budget YTD

2019/20
Amended
Budget

2019/20
YTD Bud Variance

2019/20
YTD Bud Variance

 

$

$

$

%

$

Revenue from Ordinary Activities

0.98%

702,075

1.    Operating Grants, Subsidies and Contributions

4,116,107

3,078,887

4,977,647

33.69%

1,037,220

2.    Other Revenue

381,632

431,703

551,510

(11.60%)

(50,071)

 

 

 

 

 

Expenses from Ordinary Activities

 

 

6.70%

4,495,591

3.    Materials & Contracts

(13,301,654)

(15,913,936)

(19,058,249)

16.42%

2,612,282

4.    Other Expenditure

(2,256,506)

(2,876,755)

(4,995,811)

21.56%

620,249

5.    Allocations

1,626,014

1,811,318

2,161,452

10.23%

(185,304)

 

 

 

 

 

 

6.    Non-Operating Grants, Subsidies and Contributions

8,132,479

8,697,821

24,388,690

(6.50%)

(565,342)

 

 

 

 

 

 

Capital Revenue & (Expenditure)

 

 

38.60%

17,834,469

7.    Land & Buildings

(3,870,942)

(7,267,454)

(8,861,113)

46.74%

3,396,512

Plant & Equipment

(3,241,885)

(4,820,850)

(4,885,350)

32.75%

1,578,965

Furniture & Equipment

(376,629)

(939,380)

(1,113,069)

59.91%

562,751

Infrastructure

(13,691,355)

(28,744,185)

(38,328,246)

52.37%

15,052,830

8.    Proceeds from Sale of Assets

3,063,385

703,550

3,409,080

335.42%

2,359,835

9.    Transfer to Restricted Assets

(642,003)

(50,090)

(60,100)

(1181.70%)

(591,913)

10.  Transfer from Restricted Assets

1,675,268

0

6,319,121

100.00%

1,675,268

11.  Transfer from Reserves

8,149,866

12,597,783

35,648,783

(35.31%)

(4,447,917)

Revenue from Ordinary Activities

Year to date (YTD) actual income from ordinary activities is $702K more than expected when compared to the YTD amended budget, with the following items meeting the material variance reporting thresholds:

 

1.    Operating Grants, Subsidies and Contributions are $1M (net) better than amended budget. This variance is mainly due to the following:

·    Grants Commission - Special Grants Bridges (10152), ($158K) - $124K is still to come in relation to Bussell Hwy Bridge 0241.  The remaining variance relates to budgeting misallocations where the grants were actually supposed to be main roads direct funding;

·    Insurance Reimbursements (10200), $138K – mainly due to the LGIS scheme member credit refund of $127K;

·    Legal Fees Reimbursements (10500), ($65K) – budget item included for a fine that was received in the 18/19 financial year.  A budget amendment was processed to move a portion of the fine from retained earnings to a legal reserve, however no amendment to remove this budgeted revenue item in 19/20 will be done;

·    Human Resources Reimbursements (10521), $50K - $33K due to conference and training reimbursements not budgeted for sufficiently and $19K received in workers comp reimbursements with all receipts budgeted in June;

·    Contributions to Airport Operations (11151), $51K – received December but budgeted in June;

·    Strategic Planning Operating Grants & Subsidies (10820), ($31K) – This is remaining grant funding for the CAS project which will not be finalized until later in the year.  The remaining activities for the project will be carried over into the next budget;

·    Environmental Management Administration (10830), $232K – $170K grant received for the Revitalizing Geographe Waterways Phase 2 project earlier than budgeted, plus unbudgeted amounts of $40K for Lower Vasse River Collaborative Project from Regional Estuaries Initiatives, and $20K for Strategic Weed Action for Biodiversity Protection from Department of Primary Industries;

·    Protective burning and firebreaks reserve (10931), $166K – This variance relates to receiving 50% grant awarded to the City under the mitigation activity fund (Emergency Services Levy), which was not budgeted.  Details of the cost codes for a budget amendment have not been finalised;

·    Bushfire Risk Management Planning Grants DFES (10942), $28K – This variance relates to the payment of grant in full for the bushfire risk planning coordinator position within the City of Busselton. This represents a timing difference between budget allocations (over 12 months), and actual funds received;

·    Preventative Services CLAG Contribution (10925), ($29K) – Offset by budgeted expenditure that has not occurred, to the same amount;

·    Fire Prevention DFES Contribution & Prior Period Adjustments (10940), $21K – timing difference due to prior period adjustments for late receipted contributions;

·    Wonnerup South Rd Bridge Slk 2.3 (A3440), $32K – emergency funding received from Main Roads for repairs undertaken;

·    Pre-Primary Building & Surrounds (B1503), $30K – Grant was budgeted to be received in June 2020, but was received in November 2019;

·    Busselton Jetty Contributions (11160), $35K – bi-annual contribution more than budgeted;

·    Regional Waste Management Administration (11301), ($32K) – Contributing councils have not been invoiced as much as budgeted;

·    Operations Services Works Reimbursements (11501), $25K – Workers compensation reimbursement for wages paid;

·    Reimbursements Old Butter Factory (B1401 & B9610), $371K – Timing difference due to difficulties in predicting when LGIS would process the claims;

·    Storm Damage Insurance Renewal (C2527), $37K – insurance claim for damage to King Street steps and ramp received.

 

2.    Other Revenue is ($50K) worse than budget.  The main contributing variances are outlined in the table below:

 

Cost Code

Cost Code Description / GL Activity

Variance
YTD
$

10100

Finance & Corporate Services Support - LSL contribution not received from other LG (Offset by officer not taking LSL this FY)

(26,000)

10510

Governance Support Services (LSL contribution received from other LG.  Not related to above)

14,745

10591

Geographe Leisure Centre (LSL contribution not received from other LG)

(13,599)

10970

Parking Control

(44,644)

G0030

Busselton Transfer Station

53,498

G0031

Dunsborough Waste Facility

(29,873)

 

Expenses from Ordinary Activities

Expenditure from ordinary activities is $4.5M or 6.7% less than expected when compared to the amended YTD budget.  The following items meet the material variance reporting thresholds:

 

3.    Materials and Contracts better than amended budget YTD by $2.6M

 

The main contributing items are listed below, most of which being heavily influenced by the slow down in activity caused by the COVID-19 shutdowns and restrictions:

 

Cost Code

Cost Code Description / GL Activity

Variance
YTD
$

Finance and Corporate Services

163,118

10000

Members of Council

(24,512)

10500

Legal and Compliance Services

62,661

10616

Winderlup Villas Aged Housing

26,790

Community and Commercial Services

450,062

10380

Busselton Library

70,319

10590

Naturaliste Community Centre

28,411

10591

Geographe Leisure Centre

34,258

10600

Busselton Jetty Tourist Park

117,724

10625

Art Geo Administration

30,635

10630

Property and Business Development

29,607

10900

Cultural Planning

55,631

Planning and Development Services

705,907

10820

Strategic Planning

185,511

10830

Environmental Management Administration

181,959

10850

Implement Management Plans Other

81,822

10931

Protective Burning & Firebreaks-Reserves

50,246

11170

Meelup Regional Park

99,680

Engineering and Works Services

1,252,600

Various

Busselton Jetty Maintenance

461,891

12620

Rural-Tree Pruning

(23,306)

12621

Urban-Tree Pruning

(64,958)

Various

Bridge Maintenance

84,856

Various

Building Maintenance

55,476

Various

Other Infrastructure Maintenance

564,579

Various

Waste services

239,684

Various

Road Maintenance

(221,641)

Various

Reserve Maintenance

156,021

 

4.    Other Expenditure $620K under the amended YTD budget:

 

The main contributing items are listed below:

 

Cost Code

Cost Code Description / GL Activity

Variance
YTD
$

Finance and Corporate Services

244,179

10000

Members of Council

135,822

10151

Rates Administration

51,017

10700

Public Relations

36,581

Community and Commercial Services

224,377

10530

Community Services Administration

169,945

Engineering and Works Services

128,165

11160

Busselton Jetty

70,830

B1223

Micro Brewery - Public Ablution

60,000

 

5.    Allocations

In addition to administration based allocations which clear each month, this category also includes plant and overhead related allocations. Due to the nature of these line items, the activity reflects as a net offset against operating expenditure, in recognition of those expenses that are of a capital nature (and need to be recognised accordingly). It should be noted that performance in the category has no direct impact on the closing position.

 

Non-Operating Grants, Subsidies and Contributions

6.    Non-Operating Grants, Subsidies and Contributions are below budget by $565K with the main items impacting on this being the timing of the receipt of funding. This has been exacerbated by the delays in completing capital projects due to the COVID-19 shutdowns and restrictions.  This is largely offset with less than anticipated capital expenditure at the same time, where works have not been completed in connection with the funding.  The extent to which the works remain incomplete will represent a positive impact on net position, and the remaining funding will be carried forward in reserves to be spent in future periods in order to complete the projects.


 

Cost Code

Cost Code Description

Variance
YTD

Finance and Corporate Services

(383,315)

10239

Contributions (Program 11) - Community Facilities

(641,031)

10239

Contributions (Program 12) – Works

110,897

10250

Information & Communication Technology Services – Capital Grants (Federal)

144,956

Community and Commercial Services

65,858

C6025

Installation of Bird Netting – Capital Grant (Federal)

(92,620)

C6099

Airport Development – Capital Grant (Federal)

151,478

Planning and Development Services

(798,110)

B1015

Hithergreen District Bushfire Brigade – Donated Assets

(465,200)

B1024

Wilyabrup Bushfire Brigade – Donated Assets

(178,300)

B1029

Busselton Branch SES – Donated Assets

(97,200)

B9109

Hithergreen Building Renovations – Capital Grant (State)

(57,410)

Engineering and Works Services

550,225

B9407

Busselton Senior Citizens – Contributions

111,300

C1512

Port Geographe Boat Ramp Renewal Works – Capital Grant (State)

60,500

C3020

Donated Assets Parks, Gardens & Reserves

329,133

C3113

Busselton Tennis Club – Infrastructure – Contribution

80,000

C3122

Rails to Trails - Continuation of Implementation Plan – Capital Grant (Lotteries Commission)

(300,000)

C3168

Busselton Foreshore Jetty Precinct – Capital Grant

44,554

C3186

Lou Weston Oval – Courts – Contributions

(235,000)

C3210

McBride Park - POS Upgrade – Contributions

(32,538)

C3211

Tulloh St (Geographe Bay Road) - POS Upgrade – Contributions

(90,332)

C3213

Cabarita Road - POS Upgrade – Contributions

(100,000)

C3214

Kingsford Road - POS Upgrade – Contributions

(150,653)

C3215

Monash Way - POS Upgrade – Contributions

(167,174)

F0019

College Avenue – Capital Grant (State)

144,000

S0035

Strelly Street / Barlee Street Roundabout – MR Capital Grant

31,028

S0051

Causeway Road / Rosemary Drive Roundabout – MR Capital Grant

(50,000)

S0064

Peel Terrace (Stanley Pl/Cammilleri St Intersection Upgrade) – MR Capital Grant

(166,670)

S0069

Peel Terrace (Brown Street Intersection Upgrades) – MR Capital Grant

(83,330)

S0070

Peel & Queen Street Roundabout Service Relocation – MR Capital Grant

(216,670)

S0071

Ludlow-Hithergreen Road Safety Improvements – Fed Capital grant

461,200

S0072

Kaloorup Road - Reconstruct and Seal Shoulders – MR Capital Grant

100,000

S0324

Georgette Street - Reconstruction & Kerbs – MR Capital Grant

67,000

T0019

Wonnerup South Road - Reconstruct and Widening (narrow seal) – RTR Capital Grant

104,085

T0086

Yoongarillup Road - Reconstruct & Widen (Western Section) – RTR Capital Grant

246,350

V0002

Eastern Link - Busselton Traffic Study – Capital Grant (Federal)

400,000

Capital Expenditure

7.    As at 30 April 2020, there is an underspend variance of 49.3% or $20.6M in total capital expenditure, with YTD actual at $21.2M against the YTD amended budget of $41.8M. The attachments to this report include detailed listings of all capital expenditure (project) items, however the main areas of variance are summarised as follows:

 

Cost Code

Cost Code Description

Variance
YTD

Land

(71,308)

10370

Busselton Cemetery

(71,308)

Buildings

3,467,820

B9516

Busselton Library Upgrade

244,860

B9109

Hithergreen Building Renovations

57,410

B9300/1/2

Aged Housing Capital Improvements (Winderlup, Harris Rd)

139,904

B9407

Busselton Senior Citizens

822,910

B9556

NCC Upgrade

41,665

B9591

Performing Arts Convention Centre

313,145

B9596

GLC Building Improvements

349,769

B9605

Energy Efficiency Initiatives (Various Buildings)

(28,882)

B9606

King Street Toilets

89,842

B9610

Old Butter Factory

(63,754)

B9716 & B9717

Airport Terminals

1,366,114

B9808

Busselton Jetty Tourist Park Upgrade

136,902

Plant & Equipment

1,578,965

10000

Members of Council

40,000

11156

Airport Development Operations

342,129

11402

Plant Purchases (P10)

854,970

11403

Plant Purchases (P11)

150,146

11407

P&E - P&G Smart Technologies

150,000

Furniture & Office Equipment

574,751

10250

Information & Communication Technology Services

360,626

11156

Airport Development Operations

195,974

Infrastructure By Class

15,040,830

 

Roads

2,348,429

 

Bridges

372,000

 

Car Parks

1,323,863

 

Footpaths & Cycleways

377,696

 

Parks, Gardens & Reserves

8,747,688

 

Drainage

114,005

 

Regional Airport & Industrial Park Infrastructure

1,757,150

 

In the main, many of these projects have yet to be completed and represent a timing difference.  Due to the COVID-19 crisis, many projects have also been deferred and will be relisted for completion in next year’s budget.

 

Proceeds from Sale of Assets

8.    There is a variance for the proceeds from sale of assets of $2.6M, due to difficulty in predicting timing for the settlement of the sale of the old library building land, creating a timing difference against budget.

Transfer to Restricted Assets

9.    There is a variance in transfers to restricted assets of $592K more than amended budget. The reasons for this are as follows:

·    Interest earned on government grants of $37K transferred to restricted cash, for which there was no budget allocated as it was expected that the grant would have been utilized by this stage;

·    Additional bonds of $350K were received in relation to the next stage of the Dunsborough Lakes development;

·    Transfer of $156K representing contribution by developers, including $125K from the sale of the old library land as agreed with the developers;

·    Net transfers to deposits and bonds of $49K as opposed to a budget of $0. These funds do not have a budget allocation as they are not able to be reliably measured.

               

Transfer from Restricted Assets

10.  There is a variance in transfers from restricted assets of $1.7M more than amended budget.   The main reason for this is as follows:

·    Transfer from Roadwork Bonds of $849K as opposed to a budget of $0;

·    Refunds of $27K in deposits for venue hire;

·    Refunds of $12K of Jetty berthing deposits;

·    $34K of other miscellaneous refunds of bonds & deposits;

·    $500K reimbursement to muni of remaining loan funds for the tennis club project;

·    $253K of transfers related to partially completed roadworks projects.

These funds do not have a budget allocation as they dependant of external third parties and are not able to be reliably measured.

 

Transfer from Reserves

11.  There is a variance for transfer from reserves of $4.4M less than amended budget. The reasons for this are as follows:

·    100 – Airport Infrastructure Renewal Reserve ($169K) – Only partial work for installation of bird netting has been done and the car park resealing has not been completed;

·    136 – Airport Marketing & Incentive Reserve ($1.4M) – Being deferred until next financial year;

·    143 – Airport Noise Mitigation Reserve ($870K) – project deferred until 20/21 budget

·    106 – Building Asset Renewal Reserve $220K – early recoup related to partially completed works;

·    407 – Busselton Library Building Reserve $20K – partial recoup for the extension works;

·    408 – Busselton Jetty Tourist Park Reserve ($172K) – upgrade works only partially complete;

·    409 – Geographe Leisure Centre Building Reserve ($270K) – Project B9596 for general building improvements;

·    331 – Joint Venture Aged Housing Reserve $40K – works partially completed earlier than expected;

·    411 – Civic & Administration Building Reserve $38K – works partially completed earlier than expected;


 

·    110 – Jetty Maintenance Reserve ($495K) – only partially recouped, as works only partially undertaken on cost code C3497 (part of the Parks, Gardens & Reserves variance shown above), for the following reasons:

i.                     The previous expenditure figure was based on the 50 year plan.

ii.                   The 5 year structural review undertaken in 2019/2020 discovered that the Jetty was in better condition than forecast in the 50 year plan.  Capital works planned for 2020 have been deferred to 2030.

iii.                 Requests for Tenders issued for maintenance works per the 5 year plan are to be awarded at the Council meeting on 29 January 2020.

iv.                 As a result, budget figures have been revised for next the 5 financial years to reflect the 5 year plan;  

·    115 – Plant Replacement Reserve ($638K) – timing difference associated with recoupment for purchase of new plant;

·    137 – Major Traffic Improvements Reserve $367K – Project V0002 for the Eastern Link Project is on-going.  Approximately $1.7M has been spent, of which $400K grant funding has been received and $1M transferred to Muni;

·    132 – CBD Enhancement Reserve ($436K) – mainly due to incomplete townscape upgrade works;

·    127 – New Infrastructure Development Reserve ($123K) – This reserve is funding 10 projects at the moment, some of which are still incomplete;

·    133 – Valuation & Corporate Expenses Reserve ($12K) – the transfer to cover the $97K bill from the Electoral Commission happened in March;

·    123 - Port Geographe Waterways Management Reserve (SAR) ($327K) – Annual deed agreement not yet requested to be paid;

·    Due to cash flow requirements partially completed works were recouped from the following reserves:

i.                     223 – Road Asset Renewal Reserve $1.4M;

ii.                   224 – Footpaths & Cycleways Reserve $317K;

iii.                 225 – Parks & Garden Reserve $126K;

iv.                 302 – Community Facilities City District $415K;

v.                   303 – Community Facilities Busselton $44K;

vi.                 309 – Community Facilities Vasse $59K;

vii.                122 - Port Geographe Development Reserve $364K;

viii.              126 - Provence Landscape Maintenance Reserve (SAR) $64K;

ix.                  128 - Vasse Newtown Landscape Maintenance Reserve (SAR) $101K;

x.                   321 - Busselton Area Drainage and Waterways Improvement Reserve $35K;

xi.                  102 - Coastal and Climate Adaptation Reserve $256K;

xii.                145 - Energy Sustainability Reserve $177K;

xiii.              146 - Cemetery Reserve $185K;

·    121 – Waste Management Facility and Plant Reserve ($3.82M) – The works for the Transfer station plus the site rehabilitation jobs that have not progressed, are the biggest cause of this variance.  It is forecast that these jobs will be deferred until next financial year.

 

Investment Report

Pursuant to the Council’s Investment Policy, a report is to be provided to the Council on a monthly basis, detailing the investment portfolio in terms of performance and counterparty percentage exposure of total portfolio. The report is also to provide details of investment income earned against budget, whilst confirming compliance of the portfolio with legislative and policy limits.

 

As at 30 April 2020, the value of the City’s invested funds totalled $76.99M, down from $78.99M as at 31 March. The decrease is due to a partial closure of a term deposit.

 

During the month of April, seven term deposits totalling the amount of $22.0M matured. One deposit was partially closed totalling $2.0M to provide funds for standard operations. Remaining deposits were renewed for a further 117 days at 0.98% on average.

 

The balance of the 11am account (an intermediary account which offers immediate access to the funds compared to the term deposits and a higher rate of return compared to the cheque account) remained steady.

 

The Airport Development accounts remain steady.

 

The official cash rate in April remains steady at 0.25%. This will have a strong impact on the City’s interest earnings for the foreseeable future. Further drops are unlikely at this stage.

 

Chief Executive Officer – Corporate Credit Card

There were no transactions made on the Chief Executive Officer’s corporate credit card during April 2020.

Statutory Environment

Section 6.4 of the Act and Regulation 34 of the Regulations detail the form and manner in which a local government is to prepare financial activity statements.

Relevant Plans and Policies

There are no relevant plans or policies to consider in relation to this matter.

Financial Implications

Any financial implications are detailed within the context of this report.

Stakeholder Consultation

No external stakeholder consultation was required or undertaken in relation to this matter.

Risk Assessment

An assessment of the potential implications of implementing the officer recommendation has been undertaken using the City’s risk management framework, with risks assessed taking into account any controls already in place. No such risks have been identified.

Options

The Statements of Financial Activity are presented in accordance with Section 6.4 of the Act and Regulation 34 of the Regulations and are to be received. Council may wish to make additional resolutions as a result of having received these reports.

CONCLUSION

As at 30 April 2020, the City’s financial performance, although displaying a positive net current position, is considered at risk of not meeting operational budget expectations by the end of the financial year due to the downturn in operational activity brought on by the COVID-19 global pandemic.

TIMELINE FOR IMPLEMENTATION OF OFFICER RECOMMENDATION

Not applicable.

 


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6.2

Attachment a

Investment Report April 2020

 


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6.2

Attachment b

Statement of Financial Activity April 2020

 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 



Finance Committee                                                             51                                                                      10 June 2020

9.30am:                At this time, Cr Carter assumed the Chair.

 

9.31am:                At this time, Mr Archer left the meeting.

 

6.3             APPLICATION FOR RATE EXEMPTION - THE FREE REFORMED CHURCH OF BUSSELTON

STRATEGIC GOAL

6. LEADERSHIP Visionary, collaborative, accountable

STRATEGIC OBJECTIVE

6.1 Governance systems, process and practices are responsible, ethical and transparent.

SUBJECT INDEX

Exemptions & Appeals (Rates)

BUSINESS UNIT

Rates

REPORTING OFFICER

Rates Coordinator - David Nicholson

AUTHORISING OFFICER

Director Finance and Corporate Services - Tony Nottle

NATURE OF DECISION

Executive: substantial direction setting, including adopting strategies, plans and policies (excluding local planning policies), tenders, setting and amending budgets, funding, donations and sponsorships, reviewing committee recommendations

VOTING REQUIREMENT

Absolute Majority

ATTACHMENTS

Attachment a   Letter Requesting Rates Exemption - Free Reformed Church Busselton

Attachment b    Rate Exemption Application Form

Attachment c    Rate Exemption Application - Statutory Declaration

Attachment d   Constitution - Free Reformed Church

Attachment e    Free Reformed Church Busselton Incorporated Association Extract

Attachment f    2018-2019 Audit Letter

Attachment g   108 Hawker - Site Plan  

 

COMMITTEE RECOMMENDATION AND OFFICER RECOMMENDATION

F2006/023               Moved Councillor P Cronin, seconded Councillor J Barrett-Lennard

That the Council:

1.       Approve the rate exemption application from The Free Reformed Church of Busselton under section 6.26 (2)(d) of the Local Government Act 1995 on 108 Hawker Approach, Yalyalup effective 1 July 2019; and

2.       Agree that this rate exemption is to continue where The Free Reformed Church of Busselton confirms in writing by the 30 April annually that they continue to own and use the property for the purposes stated in the application.

CARRIED 5/0

BY ABSOLUTE MAJORITY

 

EXECUTIVE SUMMARY

An application has been received from The Free Reformed Church of Busselton for rate exemption for the property at 108 Hawker Approach, Yalyalup, which is used as the residence for their minister. On the basis of the application, this report recommends that the application for exemption be granted effective 1 July 2019 in accordance with Section 6.26(2)(d) of the Local Government Act 1995.

 


 

BACKGROUND

The Free Reformed Church of Busselton is a religious organisation that previously owned a property at 9 Salmon Close, West Busselton. This property was granted a rate exemption in August 2013 as it was being used as the residence for the minister. In August 2019, this property was sold as they had purchased 108 Hawker Approach, Yalyalup, earlier in May 2019 for a new minister’s residence.

 

In September 2019, the Church contacted the City and was provided with the necessary rate exemption application documentation. The City officially received the exemption application in February 2020.

 

Despite the delay in making the application, the Church is seeking rate exemption effective from 1 July 2019.

OFFICER COMMENT

The Act states that all land is rateable except in certain circumstances. However, Section 6.26(2)(d) of the Act states that:

 

land used or held exclusively by a religious body as a place of public worship or in relation to that worship, a place of residence of a minister of religion, a convent, nunnery or monastery, or occupied exclusively by a religious brotherhood or sisterhood” is not rateable

 

As the property 108 Hawker Place, Yalyalup, is being used as a residence and office for the Minister of the Church, it is considered to be rate exempt under section 6.26(2)(d) of the Act.

 

No physical inspection of the property has been carried out as a Statutory Declaration on its use has been provided, which is sufficient.

Statutory Environment

Section 6.26(2)(d) of the Act specifically states that land used or held exclusively by a religious body as a place of public worship or in relation to that worship, a place of residence of a minister of religion, a convent, nunnery or monastery, or occupied exclusively by a religious brotherhood or sisterhood is exempt from rates.

Relevant Plans and Policies

There are no relevant plans or policies to consider in relation to this matter.

Financial Implications

If rate exemption is approved effective 1 July 2019, there would be a reduction of $2,173 to the 2019/2020 rating and specified area rate income. There would be similar reductions for future financial periods if the property is continued to be used for the purpose of the Church.

Stakeholder Consultation

No external stakeholder consultation was required or undertaken in relation to this matter.


 

Risk Assessment

An assessment of the potential implications of implementing the officer recommendation has been undertaken using the City’s risk management framework, with risks assessed taking into account any controls already in place. No such risks of a medium or greater level have been identified.

 

However, if Council choses to not approve the application for rate exemption then staffing and/or legal costs may be incurred if the applicant refers the matter to the State Administrative Tribunal for review of the decision.

Options

As an alternative to the proposed recommendation the Council could decline the rate exemption application on the basis that it considers the property to be rateable under the Act. As stated above, this is not recommended based on the risks associated with declining the application.

CONCLUSION

It is considered, based on the application provided by The Free Reformed Church of Busselton that 108 Hawker Approach, Yalyalup, is eligible for rate exemption due to it being used as a place of residence for the minister of the church.

TIMELINE FOR IMPLEMENTATION OF OFFICER RECOMMENDATION

Given that an initial rate exemption enquiry was made in September 2019, it is considered that rate exemption on 108 Hawker Approach, Yalyalup should be effective from the 1 July 2019. Following Council’s resolution, this will be undertaken by 31 May 2020.

 


Finance Committee

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6.3

Attachment a

Letter Requesting Rates Exemption - Free Reformed Church Busselton

 


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6.3

Attachment b

Rate Exemption Application Form

 


 


 


 


 


 


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6.3

Attachment c

Rate Exemption Application - Statutory Declaration

 


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6.3

Attachment d

Constitution - Free Reformed Church

 


 


 


 


 


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6.3

Attachment e

Free Reformed Church Busselton Incorporated Association Extract

 


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6.3

Attachment f

2018-2019 Audit Letter

 


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6.3

Attachment g

108 Hawker - Site Plan

 

 

 


 


Finance Committee                                                             70                                                                      10 June 2020

7.               General Discussion Items  

7.1             PORT GEOGRAPHE MARINA SEABED RATES

                   Mr Nottle provided background information on the rates concession for the pens at Port Geographe Marina, Spinnaker Boulevard, Geographe, endorsed by Council at its meeting on 31 July 2019, applicable to the 2019/2020 general and specified area rates. Mr Nottle recommended that the Committee note and acknowledge the method of rating the Marina properties for the 2020/21 financial year on the understanding that further details will be provided by the applicant.


 

8.               Next Meeting Date

Wednesday, 22 July 2020.

 

9.               Closure

The meeting closed at 9.50am.

 

 

 

 

 

THESE MINUTES CONSISTING OF PAGES 1 TO 70 WERE CONFIRMED AS A TRUE AND CORRECT RECORD ON Wednesday, 22 July 2020.

 

DATE:_________________              PRESIDING MEMBER: _________________________