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 25 November 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 November 2020. 3

6....... Reports. 4

6.4          APPLICATION FOR RATE EXEMPTION - RELATIONSHIPS AUSTRALIA WA INC. 4

6.3          BUDGET AMENDMENT REQUEST / REVIEW - ENGINEERING AND WORKS SERVICES - NOVEMBER 2020. 12

6.1          LIST OF PAYMENTS MADE - OCTOBER 2020. 35

6.2          FINANCIAL ACTIVITY STATEMENTS - YEAR TO DATE AS AT 31 OCTOBER 2020. 45

6.5          PROPOSED FINANCE COMMITTEE MEETING DATES 2021. 75

7....... General Discussion Items. 78

8....... Next Meeting Date. 78

9....... Closure. 78

 


Finance Committee                                                             4                                                            25 November 2020

MINUTES

 

MINUTES OF Finance Committee HELD IN Committee Room, Administration Building, Southern Drive, Busselton, ON 25 November 2020 AT 10.00am.

 

1.               Declaration of Opening and Announcement of Visitors

The Presiding Member opened the meeting at 10.03am.

 

2.               Attendance 

Presiding Member:

 

Members:

 

Cr Paul Carter

 

 

Cr Grant Henley    

Cr Sue Riccelli

Cr Phill Cronin

Cr Jo Barrett-Lennard

 

Officers:

 

Mr Tony Nottle, Director, Finance and Corporate Services

Mr Oliver Darby, Director, Engineering and Works 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

Cr Sue Riccelli declared an financial (indirect) interest in relation to item 6.4 ‘Application for Rates Exemption – Relationships Australia WA Inc.’ as she provides services to Relationships Australia WA Inc.

 

Cr Grant Henley declared an impartiality interest in relation to item 6.3 ‘Budget Amendment Request / Review - Engineering and Works Services - November 2020’ as his residential property adjoins the property which is the subject of the works proposed to be undertaken at King Street.

5.               Confirmation Of Minutes

5.1             Minutes of the Finance Committee Meeting held 11 November 2020

Committee Decision

F2011/045  Moved Councillor J Barrett-Lennard, seconded Councillor G Henley

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

CARRIED 5/0

 

10.04am:       At this time, the Presiding Member agreed that Item 6.4 ‘Application for Rate Exemption – Relationships Australia WA Inc.’ would be moved forward to this point in the meeting for the benefit of officers presenting the item.

 

10.06am:       At this time, Mr Oliver Darby, Director Engineering and Works Services, entered the meeting.


 

6.               Reports

6.4             APPLICATION FOR RATE EXEMPTION - RELATIONSHIPS AUSTRALIA WA INC.

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 Rate Exemption

Attachment b    Rate Exemption Application  

 

DISCLOSURE OF INTEREST

Date

25 November 2020

Meeting

Finance Committee

Name/Position

Cr Sue Riccelli, Councillor

Item No./Subject

Item 6.4 ‘Application for Rates Exemption – Relationships Australia WA Inc.’

Type of Interest

Financial Interest (Indirect)

Nature of Interest

I provide services to Relationships Australia Inc.

 

10.07am:       At this time, Cr Riccelli left the meeting.

 

Committee RECOMMENDATION and Officer Recommendation

F2011/046               Moved Councillor G Henley, seconded Councillor P Cronin

That the Council:

1.         Approve the rate exemption application from Relationships Australia WA Inc. under section 6.26(2)(g) of the Local Government Act 1995 on 7 Harris Road, Busselton, effective 1 July 2020; and

2.         Agree that this rate exemption is to continue where Relationships Australia WA Inc. confirms in writing by the 30 April annually that they continue to lease and use the property for the purposes stated in the application.

CARRIED 4/0

BY ABSOLUTE MAJORITY

 

EXECUTIVE SUMMARY

An application with all required documentation has been received from Relationships Australia WA Inc. seeking a rate exemption on 7 Harris Road, Busselton, which they are leasing and using to deliver their Headspace Busselton services. On the basis of the application, this report recommends that the application for an exemption be granted effective as at 1 July 2020 in accordance with section 6.26(2)(g) of the Local Government Act 1995 (the Act).

 


 

BACKGROUND

Relationships Australia WA Inc. (RAWA) is a not-for-profit benevolent institution with Deductible Gift Receipt status. The vast majority of RAWA income is from Commonwealth and State grants so as to provide community services. RAWA lease 71 Kent Street, Busselton, and now 7 Harris Road, Busselton, from which they provide Headspace Busselton services free of charge to the community. At its meeting on 8 May 2019, Council approved (C1905/089) RAWA’s application for a rate exemption on 71 Kent Street, Busselton, due to it being used exclusively for charitable purposes.

 

RAWA is the lead agency for Headspace Busselton. Headspace is an organisation that operates across Australia, providing support, information and services to people aged 12-25.

 

Headspace Busselton offer anyone aged 12-25 free access to social workers, counsellors, mental health workers and psychologists. Headspace also has an extensive website where young people and their carers can read information on a wide range of issues including depression, bullying and relationship issues.

OFFICER COMMENT

Section 6.26 of the Act states that all land is rateable except in certain circumstances. Section 6.26(2)(g) states that “land used exclusively for charitable purposes” is not rateable.

 

RAWA are seeking a rate exemption on 7 Harris Road, Busselton, under section 6.26(2)(g) because of its Headspace Busselton use. They have provided the required application and documentation so as to meet the City’s assessment criteria.

 

It is considered that the application should be approved as the Headspace services provided by RAWA are charitable in nature and therefore the property at 7 Harris Road, Busselton, would be rate exempt under section 6.26(2)(g) of the Act.

 

No physical inspection of the property has been carried out as the documentation provided by RAWA on the property’s use is considered sufficient.

Statutory Environment

Section 6.26(2)(g) of the Act specifically states that land used exclusively for charitable purposes is not rateable.

Relevant Plans and Policies

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

Financial Implications

Approving a rate exemption effective at 1 July 2020 would see a $4,139.84 reduction to the 2020/2021 rating income. There would be similar reductions for future financial periods where the property continues to be leased by RAWA and used for providing Headspace Busselton services.

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.

 

If Council choses to decline the rate exemption application, then staffing and/or legal costs may be incurred should RAWA request the State Administrative Tribunal review 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 that the property at 7 Harris Road, Busselton, whilst leased by Relationships Australia WA Inc. and used by them to provide Headspace Busselton services to the community would be rate exempt under section 6.26(2)(g) of the Act.

TIMELINE FOR IMPLEMENTATION OF OFFICER RECOMMENDATION

The rate exemption on 7 Harris Road, Busselton, if approved, should be effective from 1 July 2020 as the application was lodged by Relationships Australia WA Inc. after they received the property’s 2020/21 annual rate notice.


Finance Committee

7

25 November 2020

6.4

Attachment a

Letter Requesting Rate Exemption

 


Finance Committee

8

25 November 2020

6.4

Attachment b

Rate Exemption Application

 




 


Finance Committee                                                             18                                                          25 November 2020

10.17am:              At this time, Mr Nicholson left the meeting.

 

10.17am:              At this time, Cr Riccelli re-entered the meeting. The Presiding Member read aloud the Committee’s Recommendation for Item 6.4 as above.

 

10.17am:              At this time, the Presiding Member agreed to move Item 6.3 ‘Budget Amendment Request / Review - Engineering and Works Services - November 2020’ forward to this point in the meeting for the benefit of officers presenting the item.

 

6.3             BUDGET AMENDMENT REQUEST / REVIEW - ENGINEERING AND WORKS SERVICES - NOVEMBER 2020

STRATEGIC GOAL

STRATEGIC OBJECTIVE

6. LEADERSHIP Visionary, collaborative, accountable

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

SUBJECT INDEX

Budget Planning and Reporting

BUSINESS UNIT

Financial Services

REPORTING OFFICER

Director, Engineering and Works Services - Oliver Darby

AUTHORISING OFFICER

Director, Engineering and Works Services - Oliver Darby

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   Minister Letter of Approval

Attachment b    Bridge Funding Letter of Approval

Attachment c    Special Bridge Grant - Design Tuart Drive Bridge

Attachment d   Bridge Renewal Program R5 WA funded projects  

 

DISCLOSURE OF INTEREST

Date

25 November 2020

Meeting

Finance Committee

Name/Position

Cr Grant Henley, Councillor

Item No./Subject

Item 6.3, ‘Budget Amendment Request / Review - Engineering and Works Services - November 2020’

Type of Interest

Impartiality Interest

Nature of Interest

My residential property adjoins the reserve which is part of the property which is the subject of the works proposed to be undertaken at King Street.

                                                              


 

Committee RECOMMENDATION and Officer Recommendation

F2011/047               Moved Councillor S Riccelli, seconded Councillor J Barrett-Lennard

That the Council endorse the requested budget amendments outlined in this report, recognising the additional income received in grant funding, and restricted asset transfers including the associated expenditure as follows:

Reference

Description

Project Code

Additional External Revenue

Use of Revenue Received in Prior Years

Additional Expenditure

Transfer to/from Reserves

 

Transfer from Restricted Assets

Impact on Budget

1

Boallia Road Bridge

C0024

1,009,000

 -

1,009,000

-

-

 -

2

Kaloorup Road Bridge

C0023

936,000

 -

936,000

-

-

 -

3

Tuart Drive Bridge

A0025

2,500,000

-

2,500,000

-

-

 -

4

King Street Carpark Reconstruction

C0060

 -

 -

46,860

-

 

46,860

 -

5

King Street Landscaping Stage 2

C3237

-

 -

15,000

 -

 

15,000

 -

6

Queen Street Paving Upgrade

S0075

-

-

44,547

-

 

44,547

-

 

The budget amendment is made in accordance with section 6.8(1) of the Local Government Act 1995 and results in a $0 net impact on the 2020/21 annual budget.

CARRIED 5/0

BY ABSOLUTE MAJORITY

EXECUTIVE SUMMARY

This report seeks Council approval of budget amendments as detailed in this report. Adoption of the Officer Recommendation will result in a zero impact to the City’s budgeted net current position.

BACKGROUND

In accordance with section 6.8(1) of the Local Government Act 1995, a local government is not to incur expenditure from its Municipal fund for an additional purpose except where the expenditure:

·        is incurred in a financial year before the adoption of the annual budget by the local government;

·        is authorised in advance by Council resolution - absolute majority required; or

·        is authorised in advance by the Mayor in an emergency.

 

Approval is therefore sought for the budget adjustments for the reasons specified.


 

OFFICER COMMENT

Council adopted its 2020/2021 Municipal budget on Monday 27 July 2020 with a balanced budget position. Since then, officers have identified budgets that require adjustment. It is good management practice to revise the adopted budget when it is known that circumstances have changed. In keeping with this practice, budgets are reviewed on a monthly basis and removes the need for a major budget review in February/March of each calendar year.

 

Amendments to the budget are categorised into the three key types as listed below:

i.          Adjustments impacting the budget balance or net position of the City: relatively uncommon type.

ii.         Adjustments with no impact on the budget balance: most common amendment type.

iii.        Adjustments to transfer budget between capital and operating undertakings: relatively uncommon type.

 

Officers have reviewed the adopted budget for the month of August 2020 and subsequently recommend alterations to the budget as set out below.

 

i.          Adjustments impacting the budget balance.

This section identifies items which either increase or decrease the 2020/2021 budgeted operating position. There are no budget adjustment items requiring Council’s approval of this type.

 

ii.         Adjustments with no impact on the budget balance.

There are two budget amendment items of this type detailed below. The net effect of these amendments on the budget position is zero.

  

These adjustments are where new expenses are matched with new grants or contributions, or where reserve offsets are transferred between projects. In some instances, it is where requests are made to draw down additional budget from specific reserves for various reasons, or where expenses are reallocated within business units or between projects to meet revised needs.

 

1.    BRIDGE RENEWAL GRANTS                                 Cost Codes A0023, A0024, A0025             

The City has been awarded grant funding for the renewal of three bridges under the Federal Government’s Bridge Renewal Program Round 5 (see Attachment B). Securing funding for three bridges is unprecedented with only 10 bridges funded across all of Western Australia under round 5.

 

a)         Boallia Road Bridge renewal of old timber structure with concrete culvert style crossing; total project cost $1,009,000. 50% will be Federal Bridge Grant funding while Main Roads WA will contribute the remaining 50%.

 

b)        Kaloorup Road Bridge renewal of old timber bridge structure with concrete culvert style crossing; total projects $936,000. 50% will be Federal Bridge Grant funding while Main Roads WA will contribute the remaining 50%. Further detail regarding these upgrade works are detailed below.

 

c)         Tuart Drive Bridge replacement post fire; total project cost $3,010,989. Funded from two Federal Bridge grants and Main Roads funding. Further detail regarding these upgrade works are detailed below.

 


 

Comments Regarding Each Project

 

a)         Boallia Road Bridge

The Boallia bridge project currently has $138,000 recorded on budget as both revenue and expense. These funds represent the estimated detailed design costs associated with the projects. Main Roads WA has outlaid these funds with no cost to be borne by the City. Australian Accounting Standards require that these costs be capitalised onto the City’s Balance Sheet at completion of the project, forming part of the overall new asset cost. In effect, these costs will be treated as donated assets as the City has ownership of the bridge. To this end, the $138,000 will be adjusted from the budget while at the same time the $1,009,000 will be added for the construction pursuant to the receipt of the Round 5 Bridge Renewal Program grant.

 

b)        Kaloorup Road Bridge

The same applies to the Kaloorup Road bridge project which also has $138,000 recorded on budget as both revenue and expense. As per above, these funds represent the estimated detailed design costs associated with this project. Main Roads WA has outlaid these funds with no cost to be borne by the City. Australian Accounting Standards require that these costs be capitalised onto the City’s Balance Sheet at completion of the project, forming part of the overall new asset cost. In effect, these costs will be treated as donated assets as the City is the owner of the bridge. To this end, the $138,000 will be adjusted from the budget while at the same time $936,000 will be added for the construction pursuant to the receipt of the Round 5 Bridge Renewal Program grant.

 

Further to the above, this project has only been provisioned with $250,000 in Federal grant funding instead of the $468,000 required to enable the project to proceed. Main Roads has available their 50% contribution of $468,000. A letter has subsequently been drafted by the Department of Infrastructure, Transport, Regional Development and Communications Program Administrator to the Minister seeking an allocation of an extra $218,000 from surplus bridge grant funds from prior rounds of the program. A simple administrative error where an incorrect figure was taken is the cause of the incorrect grant amount being allocated. Council will be kept informed of any developments. It is however recommended that the project be adjusted onto the budget at the full value in the knowledge that Main Roads will only proceed if the extra funding is secured.

 

c)         Tuart Drive Bridge

The Tuart Drive Bridge over the Abba River already has $567,000 in funding provisioned within the 2020/21 Budget that was set aside for planned substructure and superstructure repairs, assigned prior to the bridge being destroyed by fire. This is funding under the Federal Government’s Special Bridge Program distributed via the Financial Assistance Grant arrangements to the City by the Western Australian Grants Commission.

 

Council should be aware that this project will be funded by two Federal Government bridge related programs that are separate and distinct to each other with each administered by different Federal Government departments.

 

The Special Bridge Program grant has subsequently been adjusted in dollar value and redirected towards the detailed design and preliminary costs associated with the full replacement of the bridge, post destruction by fire (Attachment C).

 

Funding

Source

$340,659.00

Federal Special (Project) Bridge Funding

$170,330.00

Main Roads WA

$510,989.00

 

 


 

In summary, the total bridge project budget of $3,010,989 will comprise:

1.         $510,989 in Special Bridge Grant on a 2/3rd, 1/3rd basis with Main Roads contributing the 1/3rd difference.

2.         $2,500,000 from the Bridge Renewal Program Round 5, based on a 50/50 funding basis with Main Roads WA contributing the other 50% totalling $1,250,000 towards the project.

 

These funds are to be incorporated into one Tuart Drive Bridge replacement project used for both the detailed design and construction.

 

2.    CASH IN LIEU OF PUBLIC OPEN SPACE                                            Cost Code C0060, C3237, S0075

The City holds a Cash in Lieu of Public Open Space (CIL POS) contribution (reference number 25) valued at $174,365. This contribution is pursuant to a development in Eagle Bay that was collected in 1997. The different in value equates to interest earnings. These funds were tied to works related to public open space that must occur within the vicinity of the development.

 

The Western Australian Planning Commission have agreed via formal correspondence (see Attachment A) to the following:

1.         $67,958 to be utilised to construct a universal access footpath in Eagle Bay. This item is already on the 2020/21 budget (Cost Code C1753); funded from this source with an additional $27,500 from the Community Facility Development fund. 

 

2.         That the balance totalling $106,407 plus any interest that may accrue to a value of $107,465 be retrospectively applied to park POS upgrade works that the City had previously carried out at Riedle Park in Eagle Bay between 2010 through to 2014.  

 

The retrospective approval of works that have been carried out and paid for out of prior year municipal funds means that these restricted CIL POS monies are now deemed unrestricted and are transferrable into municipal funds, to be utilised at the discretion of the Council.  

 

Council approval is subsequently sought to recoup these funds and increase the budgets of the following projects:

a)         King Street Carpark Reconstruction                 (C0060)                 +$46,860

b)        King Street Landscaping Stage 2                        (C3237)                 +$15,000             

c)         Queen Street Paving Upgrade                           (S0075)                 +$44,547

 

a)        King Street Carpark Reconstruction (C0060)

$140,000 has been budgeted for the King Street Car Park reconstruction. The scope of works has been increased to include the addition of a limestone wall to further protect the area from windblown sand, to provide additional seating and reduce damage caused by winter storms. This wall will complement the sand bag defences already in place.

b)        King Street Landscaping Stage 2 (C3237)

The upgraded King Street POS is now nearing completion. $64,000 had been budgeted for stage 2 landscape works. Forecasting has indicated that there will be a $15,000 shortfall against budget. To this end, an additional budget allocation is being sought. This extra cost can be attributed to small increases in project scope across elements of additional turf, planting and irrigation.

 


 

c)         Queen Street Paving Upgrade

The Queen Street Paving project stage 1 is budgeted at $961,870, funded by the Federal Government’s Local Road and Community Infrastructure Program. Council approval is sought to assign the balance of remaining funds of $44,547 towards this project. This will increase the budget annual allocation to $1,006,417.

 

iii.       Transfers between capital and operating budget.

This section is intended to identify any items which reallocate funds between the Capital Budget and Operating Budget. These items do not change the overall budget. There are no items detailed in the attachment requiring Council approval in this period.

 

Net Budget Position

After making the above adjustments, the budget position remains unchanged from budget adoption. Adjustments made to the Municipal Cash Budget is nil.

Statutory Environment

Section 6.8 of the Local Government Act 1995 refers to expenditure from the municipal fund that is not included in the annual budget. Any adjustments to a budget allocation must be made by an absolute majority decision of the Council. Additionally, where no budget allocation exists, expenditure is not to be incurred until such time as it is authorised in advance, by an absolute majority decision of the Council.

Relevant Plans and Policies

The proposed budget amendment is supported by the City’s asset management plan, capital works program and long term financial plan.  

Financial Implications

A summary of the financial implications of these recommendations is shown in the table below. 

Reference

Description

Project Code

Additional External Revenue

Utilisation of Revenue Received in Prior Years

Additional Expenditure

Transfer to/from Reserves

 

Transfer from Restricted Assets

Impact on Budget

1

Boallia Road Bridge

C0024

1,009,000

 -

1,009,000

-

-

 -

2

Kaloorup Road Bridge

C0023

936,000

 -

936,000

-

-

 -

3

Tuart Drive Bridge

A0025

2,500,000

-

2,500,000

-

-

 -

4

King Street Carpark Reconstruction

C0060

 -

 -

46,860

-

 

46,860

 -

5

King Street Landscaping Stage 2

C3237

-

 -

15,000

 -

 

15,000

 -

6

Queen Street Paving Upgrade

S0075

-

-

44,547

-

  44,547

-

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.  There are no risks identified of medium or greater level.

Options

The Council could decide not to go ahead with the proposed budget amendment request.

CONCLUSION

Council’s approval is sought to amend the budget as per the details contained in this report.

TIMELINE FOR IMPLEMENTATION OF OFFICER RECOMMENDATION

Should the Officer Recommendation be endorsed, the associated budget amendment will be processed within a month of being approved.

 


Finance Committee

20

25 November 2020

6.3

Attachment a

Minister Letter of Approval

 



Finance Committee

21

25 November 2020

6.3

Attachment b

Bridge Funding Letter of Approval

 


Finance Committee

22

25 November 2020

6.3

Attachment c

Special Bridge Grant - Design Tuart Drive Bridge

 


Finance Committee

34

25 November 2020

6.3

Attachment d

Bridge Renewal Program R5 WA funded projects

 












 


Finance Committee                                                             36                                                          25 November 2020

10.38am:              At this time, Mr Darby left the meeting.

6.1             LIST OF PAYMENTS MADE - OCTOBER 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 October 2020  

 

Committee RECOMMENDATION and Officer Recommendation

F2011/048               Moved Councillor J Barrett-Lennard, seconded Councillor P Cronin

That the Council notes payment of voucher numbers M118335 – M118374, EF074591 – EF075127, T7531 – T7533, DD004286 – DD004319 together totalling $7,343,005.77.

CARRIED 5/0

 

EXECUTIVE SUMMARY

This report provides details of payments made from the City’s bank accounts for the month of October 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 October 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 October 2020 is presented for information.

TIMELINE FOR IMPLEMENTATION OF OFFICER RECOMMENDATION

Not applicable.


Finance Committee

44

25 November 2020

6.1

Attachment a

List of Payments October 2020

 









Finance Committee                                                             55                                                                      25 November 2020

6.2             FINANCIAL ACTIVITY STATEMENTS - YEAR TO DATE AS AT 31 OCTOBER 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 October 2020

Attachment b    Financial Activity Statement October 2020  

 

Committee RECOMMENDATION and Officer Recommendation

F2011/049               Moved Councillor S Riccelli, seconded Councillor J Barrett-Lennard

That the Council receives the statutory financial activity statement reports for the period ending 31 October 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 31 October 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 27 July 2020, the Council adopted (C2007/071) the following material variance reporting threshold for the 2020/21 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 2020/21 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 only if not to do so would present an incomplete picture of the financial performance for a particular period; 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 31 October 2020

The Statement of Financial Activity (FAS), for the year to date (YTD) as at 31 October 2020 shows an overall Net Current Position of $39.2M as opposed to the budget of $29.6M.  This represents a positive variance of $9.6M YTD.  

 

The following table summarises the major YTD 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. Each numbered item in this lead table is explained further in the report.

 

Description

2020/21
Actual YTD

$

2020/21
Amended
Budget YTD

$

2020/21
Amended
Budget

$

2020/21
YTD Bud Variance

%

2020/21
YTD Bud Variance

$

Change in Variance Current Month

$

Expenses from Ordinary Activities

 

12.39%

3,418,384

593,034

1.     Materials & Contracts

(4,396,614)

(6,138,202)

(18,710,746)

28.37%

1,741,588

(68,485)

2.     Utilities

(817,170)

(930,874)

(2,770,956)

12.21%

113,704

(27,414)

3.     Insurance Expenses

(595,730)

(744,378)

(770,664)

19.97%

148,648

102,307

4.     Other Expenditure

(686,189)

(1,604,135)

(5,236,779)

57.22%

917,946

325,158

 

 

 

 

 

 

 

5.    Non-Operating Grants, Subsidies and Contributions

2,798,325

3,814,724

29,904,462

(26.64%)

(1,016,400)

(264,846)

 

 

 

 

 

 

 

Capital Revenue & (Expenditure)

 

27.58%

5,265,374

1,464,322

6.     Land & Buildings

(1,604,774)

(2,332,565)

(17,454,059)

31.20%

727,791

451,284

        Plant & Equipment

(205,528)

(530,448)

(2,510,340)

61.25%

324,920

146,362

        Furniture & Equipment

(30,852)

(80,755)

(461,088)

61.80%

49,903

80,451

        Infrastructure

(4,331,091)

(10,640,296)

(35,785,600)

59.30%

6,309,205

1,655,811

7.     Proceeds from Sale of Assets

121,925

261,500

581,500

(53.37%)

(139,575)

(40,000)

8.     Transfer to Restricted Assets

(1,900,241)

(18,336)

(62,750)

(10263.45%)

(1,881,905)

(833,184)

9.     Transfer from Restricted Assets

59,012

0

2,747,074

100.00%

59,012

13,750

10.  Transfer from Reserves

1,462,052

1,698,005

34,768,797

(13.90%)

(235,953)

(36,101)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses from Ordinary Activities

Expenditure from ordinary activities is $3.4M or 12.4% less than expected when compared to the budget YTD as at October.  The following individual expense line items on the face of the financial statement have YTD variances that meet the material reporting thresholds:

 

1.      Materials and Contracts

Better than budget by $1.7M or 28.4%.  The table below lists the main variance items that meet the reporting thresholds:

Cost Code

Cost Code Description

Actual YTD

$

Amended Budget YTD

$

Variance
YTD
$

Variance
YTD
%

Change in Variance Current Month

$

Finance and Corporate Services

705,929

756,662

50,733

6.7%

(89,686)

10000

Members of Council

63,326

32,856

(30,470)

(92.7%)

(36,995)

The variance is timing related and is in relation to Subscriptions and Memberships.  We have received and paid all of the membership fees due under this budget line item, where it was anticipated that we would receive a number of them later in the year (by the end of December).  This variance will resolve after December.

Community and Commercial Services

395,324

760,966

365,642

48.0%

21,800

10380

Busselton Library

12,794

39,022

26,228

67.2%

3,258

Various maintenance and cleaning contracts at the library have been delayed somewhat in order to coincide with the completion of the extension.  Budget timing was per normal operating parameters.

10541

Recreation Planning

1,030

32,665

31,635

96.8%

3,137

Timing of expenditure is largely due in Q2 & Q3 due to flora/fauna assessment scheduling and awaiting the outcomes of external grant applications.  Budget timing will be adjusted accordingly.

10590

Naturaliste Community Centre

19,300

46,451

27,151

58.5%

10,555

The Naturaliste Community Centre was closed due to COVID and upon reopening was subject to phased restrictions which limited the attendance numbers and therefore expenditure associated with our programs and services throughout July and into August and September. To date we are still limited by Phase 4 restrictions and have limited numbers in some activities affecting a slow return to business as usual and therefore planned expenditure.  Business is now picking up and we are likely to see increased expenditure over the next few months in line with budget.

10591

Geographe Leisure Centre

88,873

137,368

48,495

35.3%

20,338

This is the same as the factors listed above for the NCC.

10600

Busselton Jetty Tourist Park

128,974

193,672

64,698

33.4%

5,544

The majority of this variance cost is the monthly management contract fee ($41,125) for the caravan park which has resulted due to a timing issue with presentation and payment of the invoice. Other expenses falling within Materials & Contracts are related to maintenance which will occur throughout the year.

11151

Airport Operations

47,861

166,752

118,891

71.3%

5,842

The budget YTD monthly allocation for Airport Ops of $119k includes the key allocations of:

·    Security screening allocations of $61k not spent

·    Contractors - $49k for water tank removal & tree clearing not completed/expended

·    Smaller variances in other cost codes (3224) not expended

Planning and Development Services

329,511

678,707

349,196

51.5%

27,264

10830

Environmental Management Administration

102,090

168,665

66,575

39.5%

(45,159)

Expenditure variance due to the timing of the awarding of Revitalising Geographe Waterways Water Sensitive Urban Design contract and Lower Vasse River Living Streams Mussel survey contract.


 

10925

Preventative Services – CLAG

20,572

57,332

36,760

64.1%

12,015

CLAG mosquito treatments have just commenced for the season.  Purchase orders have been raised for CLAG chemical purchases and will be reflected in the account balances next month.

10931

Protective Burning & Firebreaks-Reserves

7,672

181,296

173,624

95.8%

45,197

Q2 mitigation well underway, with all spring burns now complete. Invoices for works completed are starting to be received as of 26/10/2020.

Engineering and Works Services

2,966,319

3,938,747

972,428

24.7%

(30,278)

12600

Street & Drain Cleaning

75,396

145,912

70,516

48.3%

36,373

Expenditure timing - large component of this budget provides for a program of pre-winter drainage maintenance that occurs during the summer months.

12620 & 12621

Rural & Urban Tree Pruning

39,580

126,000

86,420

68.6%

19,716

Expenditure timing and reduced expenditure to potentially offset May 2020 storm damage subject to DRFAWA claims.

Various

Bridges

8,529

60,404

51,875

85.9%

9,910

Expenditure timing and reduced expenditure to potentially offset May 2020 storm damage subject to DRFAWA claims.

Various

Buildings

371,821

473,692

101,871

21.5%

27,825

The majority of scheduled maintenance activities to Buildings occur in the second half of the financial year; hence the year to date variance to budget (which is spread evenly).

Various

Other Infrastructure Maintenance

231,102

595,238

364,136

61.2%

34,595

This broad category encompasses the consolidation of 84 separate and unique services delivered across the City, this includes things like Event support; Boat Ramp maintenance; Cemetery maintenance; maintenance at the Libraries & GLC, Caravan Park maintenance, Street Lighting installation; the Foreshores; the CBD’s; Cycleway,  Footpaths Maintenance etc. Expenditure variance for October is attributable to timing with the budget having been evenly spread across the financial year. Material & Contractor costs associated with the majority of these areas will gradually increase as we move into the busy summer months of the year. Additionally, a number of invoice for services rendered in October will be processed in November reducing the year to date variance.    

Various

Waste services

625,235

885,236

260,001

29.4%

(143,406)

The pandemic resulted with more people remaining at home for extended periods, generating more household waste. This, coupled with the 2 major storm events, requiring more time to process the increased volumes and therefore delays in payment of invoices, has contributed to the larger variances.  Another contributing factor is that the City has suspended the FOGO service (i.e. No collection & No Processing costs), for the remainder of the financial year. Furthermore, there were also delays in receiving invoices from various aspects of the recycling contractor as well.

Various

Roads Maintenance

703,921

288,936

(414,985)

(143.6%)

(53,912)

Costs are largely associated with WANDRRA storm claim from the May 2020 storm events. 3 claims have been submitted to DFES, with 1 further claim required for remaining recovery costs.

Various

Reserve Maintenance

350,667

658,324

307,657

46.7%

10,753

Costs associated with Public Open Spaces are historically lower in the first half of the financial year. Costs increase during spring and summer.

5280

Transport - Fleet Management

530,978

694,173

163,195

23.5%

27,601

Fuel was underspent by $90,944 YTD due to lower fuel cost and lower plant utilisation.  Tyre purchase was underspent by $19,050 YTD, replacement parts/tooling/contractor costs were underspent by $53,201 YTD.  Budget is spread evenly across the year, however spending is generally more cyclical in nature and peaks in the busier spring/summer/ autumn months.

 

 


 

2.    Utilities

Costs are $114K under budget YTD.  At year ended 30 June 2020, the June street lighting account was booked in June, rather than in the following month when received per normal practice.  Accruals are not done on a monthly basis, so this has the effect of causing actuals to appear to be on average $75K behind budget in relation to street lighting (until the following June, when actuals will catch up to budget).  Coupled with this there have been delays in receiving the accounts for parks & reserves from Synergy, due to system issues at their end (along with a number of other electricity accounts).  With no accruals on a monthly basis, this also causes what appears to be an under-spend against the budget.  Pending resolution of the system issues at Synergy, this should largely rectify itself in coming months as the billing cycles re-align.  This is demonstrated by a reduction in the YTD variance by $27K in October.

3.    Insurance Expenses

Underspent by $147K compared to the YTD budget of $744K, due to delays in finalising the WorkCare Workers Compensation policy and paying the outstanding premiums totaling $179K.

 

4.    Other Expenditure

$918K under the budget YTD. The main contributing items are listed below:

Cost Code

Cost Code Description

Actual YTD

$

Amended Budget YTD

$

Variance
YTD
$

Variance
YTD
%

Change in Variance Current Month

$

Finance and Corporate Services

169,066

252,079

83,013

32.9%

13,468

10000

Members of Council

128,766

181,530

52,764

29.1%

6,457

Timing variances exist in relation to the payment of elected member allowances and reimbursements.  As per previous commentary some of this is related to sitting fees being paid in arrears with a double payment in June.  This makes up approx. $30K of the variance.  Additionally the number and timing of expense reimbursements are difficult to predict when budgeting and so timing variances arise through the year, these make up just under $20K of the variance, with a further $3K related to no expenditure YTD against the council holding account. 

Community and Commercial Services

426,088

1,139,544

713,456

62.6%

213,365

10536

School Chaplaincy Programs

41,400

 -

(41,400)

(100.0%)

 -

Historically Youthcare invoices the City in the 2nd half of the year, but this year invoiced earlier than budgeted.

10547

Iron Man

 -

200,000

200,000

100.0%

200,000

Ironman has been cancelled for this year and hence the funds will not be expended and there is likely to be a report to MERG/Council before the end of the FY to reallocate the funds

10567

CinefestOZ

 -

120,000

120,000

100.0%

 -

YTD variance is due to the CinefestOZ sponsorship amount being incorrectly paid out of 10530 (a request will be made to journal funds from 10530 to this account to correct the error). Further, the sponsorship contract was varied due to change in format as a result of COVID (C2009/110) - $80k paid in 2020/21 with the balance ($38k) carried over to be paid in addition to 2021/22 MYA.

11151

Airport Operations

76

413,877

413,801

100.0%

(24)

Airport Operations include the Airline Attraction and marketing activities for RPT services which have not commenced due to COVID.

Planning and Development Services

16,848

68,831

51,983

75.5%

27,234

10820

Strategic Planning

206

28,332

28,126

99.3%

28,083

Budget for the City’s contribution to Peron Naturaliste Partnership 2020/21 was processed in October, when actual payment was made in November. This variance will be offset within the November FAS.


 

Engineering and Works Services

34,223

97,693

63,470

65.0%

64,842

B1223

Micro Brewery - Public Ablution

 -

60,000

60,000

100.0%

60,000

The City’s contributions to the construction of these ablutions is at the request of the Geographe Bay Brewing Company, following practical completion of the public amenities.  These have been completed, but GBBC have not as yet requested a release of these funds.

 

5.    Non-Operating Grants, Subsidies & Contributions

The negative variance of $1M is mainly due to the items in the table below.  It should be noted that any variance in this area will approximately correlate to an offsetting variance in a capital project tied to this funding source.  This can be seen in the section below that outlines the capital expenditure variances.

 

Revenue Code

Revenue Code Description

Actual YTD

$

Amended Budget YTD

$

Variance
YTD
$

Variance
YTD
%

Change in Variance Current Month

$

Engineering and Works Services

2,787,732

3,833,688

(1,045,956)

(27.3%)

(3,395,840)

B9407

Busselton Senior Citizens – Developer Cont. Utilised

595,306

162,479

432,827

266.4%

199,369

B9591

Performing Arts Convention Centre – Developer Cont. Utilised

 -

1,000,000

(1,000,000)

(100.0%)

(1,000,000)

C0059

Dunsborough Yacht Club Carpark – Developer Cont.

60,000

 -

60,000

100.0%

 -

F1002

Dual Use Path - Dunsborough to Busselton – State Capital Grant

64,000

 -

64,000

100.0%

64,000

F1022

Buayanyup Drain Shared Path – State Capital Grant

 -

106,668

(106,668)

(100.0%)

(106,668)

S0005

Ludlow Hithergreen Road Second Coat Seal – MR Capital Grant

180,000

150,000

30,000

20.0%

(150,000)

S0048

Bussell Highway - Developer Cont. Utilised

200,000

166,668

33,332

20.0%

(166,668)

S0070

Peel & Queen Street Roundabout Service Relocation - Developer Cont. Utilised

120,000

240,000

(120,000)

(50.0%)

(240,000)

S0073

Gale Road Rural Reconstruction – Federal Capital Grant

379,616

457,496

(77,880)

(17.0%)

(457,496)

S0075

Local Road and Community Infrastructure Program – Federal Capital Grant

480,935

240,468

240,467

100.0%

(240,468)

T0019

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

 -

149,333

(149,333)

(100.0%)

(149,333)

T0020

Capel Tutunup Road – RTR Capital Grant

 -

475,576

(475,576)

(100.0%)

(475,576)

6.    Capital Expenditure

As at 31 October 2020, there is an underspend variance of 54.6% or $7.4M in total capital expenditure, with YTD actual at $6.2M against the YTD amended budget of $13.6M.  A portion of this positive underspend variance is offset by the negative variance in Non-operating Grants, Contributions & Subsidies discussed above, with the remainder offset by the negative variances in Transfers From Reserves related to funds held aside for these projects.  The attachments to this report include detailed listings of all capital expenditure (project) items, however the main areas of YTD variance are summarised as follows:

Cost Code

Cost Code Description

Actual YTD

$

Amended Budget YTD

$

Variance
YTD
$

Variance
YTD
%

Change in Variance Current Month

$

Buildings

1,592,674

2,307,565

714,891

31.0%

451,284

B9516

Busselton Library Upgrade

278,300

452,000

173,700

38.4%

122,422

Project was underspent due to mid-June 2020 contract award which occurred later than expected.  Works were completed in October, however the final claim was not received until November and is currently being processed.

B9300

Aged Housing Capital Improvements – Winderlup

 -

26,400

26,400

100.0%

6,600

Works proposed are to separate power and drainage servicing Winderlup Court and Winderlup Villas.  The power requirements will not be triggered until the new conditional land title lot is created.  Upgrade and separation of drainage is planned to occur this f/y as the infrastructure is damaged.

B9302

Aged Housing Capital Improvements - Winderlup Court (City)

 -

52,000

52,000

100.0%

52,000

Works proposed are to separate power and drainage servicing Winderlup Court and Winderlup Villas.  The power requirements will not be triggered until the new conditional land title lot is created.  Upgrade and separation of drainage is planned to occur this f/y as the infrastructure is damaged.

B9407

Busselton Senior Citizens

594,278

738,128

143,850

19.5%

184,748

Works were completed in September.  The savings against budget are being reviewed for potential use on roof replacement and carpark works.

B9591

Performing Arts Convention Centre

602,346

719,125

116,779

16.2%

43,705

Regional Growth Fund milestones are under review pending funding extension confirmation.  Design contract program extension pending.  Budgeted cash flow is under review on this basis.

B9596

GLC Building Improvements

2,564

163,884

161,320

98.4%

40,971

Carried over works from the prior year.  Works scheduled to be completed in November 2020.

B9606

King Street Toilets

48,647

15,344

(33,303)

(217.0%)

3,571

Works completed, however budget has been spread over a longer time period.

Plant & Equipment

205,528

530,448

324,920

61.3%

146,362

10810

Statutory Planning

 -

35,000

35,000

100.0%

 -

Vehicle not yet ordered – awaiting confirmation of government pricing.  Delays in delivery are due to the high demand currently being experienced by dealers due to the government’s stimulus package in concurrence with supply chain restrictions due to COVID.

10920

Environmental Health Services Administration

 -

35,000

35,000

100.0%

 -

Vehicle ordered, not yet delivered.  Reasoning per above.

10950

Animal Control

 -

50,000

50,000

100.0%

50,000

Vehicle ordered, due to be delivered 19/11/2020.


 

10980

Other Law, Order & Public Safety

 -

50,000

50,000

100.0%

50,000

Vehicle ordered, due to be delivered 19/11/2020.

11156

Airport Development Operations

166,365

94,368

(71,997)

(76.3%)

23,592

Baggage handling system supply/install now completed, however monthly budget allocation has been spread over a longer time period.

11402

Plant Purchases (P10)

 -

40,000

40,000

100.0%

 -

Generators at DWF pond & cell – not yet replaced.  Site and operations under review.

11403

Plant Purchases (P11)

 -

80,000

80,000

100.0%

2,500

1 x vehicle ordered, not yet delivered – reasoning similar to above.  1 x vehicle not yet ordered.

11407

P&E - P&G Smart Technologies

 -

33,332

33,332

100.0%

8,333

The annual scope of this project is currently being finalised and delivery will follow during the second half of 20/21.

11500

Operations Services Administration

 -

40,000

40,000

100.0%

 -

Vehicle ordered, not yet delivered – reasoning per above.

Furniture & Office Equipment

30,852

80,755

49,903

61.8%

80,451

10250

Information & Communication Technology Services

30,852

47,755

16,903

35.4%

70,451

Alternative solution found for the Fully Qualified Domain Name project that resulted in a lower spend up front, the capital assigned will now include a migration to Exchange Online which was always an option within the initial project. Expect the costs to be drawn in Q4 2020.

10591

Geographe Leisure Centre

 -

20,000

20,000

100.0%

 -

To be spent on the purchase of an access hoist for the pools to enable those mobility impaired to gain access to the water. Anticipated date for acquisition is December (subject to supplier confirming delivery).

Infrastructure By Class

4,331,091

10,640,296

6,309,205

59.3%

1,655,811

Various

Roads

2,073,206

6,001,423

3,928,218

65.5%

733,962

In the first quarter of the financial year a majority of Projects are in the planning and design phase and as such minimal actual expenditure is recorded against them. Further to this Capital Projects with Civil works are commonly scheduled to be carried out later; in the drier summer construction season.  The Capital works budgets have been entered based on an even spread method and approach, not on a scheduled timing of works basis.

Various

Bridges

34

573,332

573,298

100.0%

143,333

Per above.

Various

Car Parks

439,887

691,252

251,365

36.4%

96,232

Per above.

Various

Footpaths & Cycleways

104,176

466,440

362,264

77.7%

56,279

Per above.

Various

Parks, Gardens & Reserves

1,650,902

2,735,845

1,084,943

39.7%

609,773

Per above.

Various

Drainage

 -

41,944

41,944

100.0%

6,725

Per above.

Various

Regional Airport & Industrial Park Infrastructure

62,886

130,060

67,174

51.6%

9,508

Per above.

 

7.    Proceeds From Sale of Assets

YTD proceeds from sale of assets is $140K behind budget due to delays in delivery of acquisitions.  Also, potential income from sales proceeds have been hampered by the pandemic. Aside from a significantly reduced capital replacement program in both light vehicles and heavy plant items, the existing ones that were due to be replaced have been retained in service to maintain operational requirements.

8.    Transfer to Restricted Assets

There is a YTD variance in transfers to restricted assets of $1.9M more than amended budget.  Grant funding received from Federal Government for “Drought Communities Program” of $500k (attributable to CC C3223 Dunsborough Non-Potable Water Network). The funding was received in September whereas budget projected allocation was in June. It was anticipated that the expenditure would be incurred in June, hence the funding timing projections followed.

 

Developer contributions and bonds are inherently hard to predict and budget for.  An annual amount of $50K spread evenly over 12 months was budgeted, however, over $1.392m has been received YTD October the bulk of which are for road works bonds ($1.068m).

 

9.    Transfer from Restricted Assets

YTD there has been $59K transferred from restricted assets into the Municipal Budget. This was mainly attributable to refunds of road work bonds of $44k, refund of hall deposits $9k and other refunds of $6k.

 

10.  Transfer from Reserves

There is a YTD variance in Transfers from Reserves of $236K less than amended budget.  The following planned expenditures, funded from reserves, had not yet occurred by the end of October:

·        $15K for the purchase of a Mule for the Busselton Jetty;

·        $20K for purchase of furniture and equipment for the GLC and $10k for Art Geo’s Art Awards;

·        $143K for purchase of eight items of plant and equipment;

·        $12K relating to a transfer from the Long Service Leave reserve upon retirement of a long serving employee; and

·        $36K relating to the purchase of generators for waste services.

 

Once these purchases have been made, a subsequent recoup will be processed.

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 31 October 2020, the value of the City’s invested funds remained steady at $89.29M. 

 

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 unchanged at 6.0M.

 

During the month of October three term deposits totalling the amount of $5.5M matured. Existing deposits were renewed for a further 131 days at 1.61% on average.

 

The official cash rate remains steady for the month of October at 0.25% but has dropped to 0.10% in November.  This will have a strong impact on the City’s interest earnings for the foreseeable future.

 


 

Chief Executive Officer – Corporate Credit Card

Details of transactions made on the Chief Executive Officer’s corporate credit card during October 2020 are provided below to ensure there is appropriate oversight and awareness.

 

Date

$ Amount

Payee

Description

3/10/2020

95.00

THE GOOSE BEACH BAR BUSSELTON

RCAWA MEETING -LUNCH

15/10/2020

10.50

SWAN TAXIS 13 13 30 VICTORIA PARK

RCAWA MEETING -TAXI

15/10/2020

185.58

QT PERTH PERTH

ACCOMMODATION - RCAWA MEETING

15/10/2020

185.58

QT PERTH PERTH

ACCOMMODATION - RCAWA MEETING

16/10/2020

39.42

QT PERTH PERTH

RCAWA MEETING -REFRESHMENTS

16/10/2020

19.18

CPP PIER STREET PERTH

RCAWA MEETING -PARKING

17/10/2020

21.26

WILSON PARKING AUSTRAL PERTH

RCAWA MEETING -PARKING

 

556.52

 

 

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 risks of a medium or greater level 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

Budget timings remain effected by COVID impacts and are gradually being re-aligned.  As at 31 October 2020, the City’s net current position stands at $39.2M. The City’s financial performance is considered satisfactory, and cash reserves remain strong.

TIMELINE FOR IMPLEMENTATION OF OFFICER RECOMMENDATION

Not applicable.


Finance Committee

56

25 November 2020

6.2

Attachment a

Investment Report October 2020

 


Finance Committee

73

25 November 2020

6.2

Attachment b

Financial Activity Statement October 2020

 



















Finance Committee                                                             77                                                          25 November 2020

6.5             PROPOSED FINANCE COMMITTEE MEETING DATES 2021

STRATEGIC GOAL

6. LEADERSHIP Visionary, collaborative, accountable

STRATEGIC OBJECTIVE

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

SUBJECT INDEX

Committee Meetings

BUSINESS UNIT

Governance Services

REPORTING OFFICER

Governance Officer - Melissa Egan

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

Nil

 

Committee recommendation and Officer Recommendation

F2011/050               Moved Councillor J Barrett-Lennard, seconded Councillor P Cronin

That the Finance Committee adopt the following Finance Committee meeting dates for 2021:

·        20 January 2021

·        10 February 2021

·        10 March 2021

·        14 April 2021

·        12 May 2021

·        9 June 2021

·        21 July 2021

·        11 August 2021

·        8 September 2021

·        13 October 2021

·        10 November 2021

·        24 November 2021

CARRIED 5/0

 

EXECUTIVE SUMMARY

This report is presented to the Finance Committee to enable the Committee to schedule and advertise its meeting dates for the 2021 calendar year.

 

BACKGROUND

The Council of the City of Busselton has established a standing committee known as the Finance Committee pursuant to section 5.8 of the Local Government Act 1995 (the Act). The Finance Committee is established for the purpose of assisting Council to fulfil its role under section 2.7(2)(a) of the Act, namely to oversee the allocation of the local government’s finances and resources.

 

Under its terms of reference, the Finance Committee must meet at least six times per year and report to Council once every two months as a minimum. Following a Committee resolution made in October 2015, the Finance Committee has been meeting on a monthly basis and the meeting schedule has been prepared accordingly.

In October 2019, Councillors indicated a preference that Committee meetings be held on the same day as Council Meetings or Briefings, being a Wednesday. The Finance Committee reviewed this mid-way through 2020 and agreed to continue with this schedule. On balance, this arrangement has worked well throughout 2020 and it is recommended that it be continued for future Finance Committee meetings.

OFFICER COMMENT

It is intended to hold the City’s Finance Committee meetings and Policy and Legislation Committee meetings on a Wednesday alternate to the scheduled Ordinary Meetings of Council. Pursuant to regulation 34(4)(a) of the Local Government (Financial Management) Regulations 1996, a local government is statutorily obliged to present a monthly statement of financial activity to Council “within two months after the end of the month it relates to”. To facilitate this obligation, it is proposed that the Finance Committee meets on the second Wednesday of each month.

 

To ensure the statement of financial activity for November 2020 is presented to Council within the statutory deadline, it is proposed that a Finance Committee meeting be held on Wednesday 20 January 2021, to then be presented at the Council meeting on 27 January 2021.

 

To accommodate Council’s mid-year recess, it will be necessary to hold a Finance Committee meeting on 21 July 2021 to enable the statement of financial activity for May 2021 to be presented at the Council meeting on 28 July 2021.

 

To ensure the statement of financial of activity for October 2021 can be presented to Council within the statutory deadline, and as Council’s last meeting of 2021 is scheduled to be held on 8 December, it is proposed to schedule a second Finance Committee meeting in the last week of November 2021. To avoid two committee meetings being scheduled for this day, it will be proposed that there is no Policy and Legislation Committee meeting scheduled for November and it is instead scheduled for 8 December 2021.

 

Under regulation 12 of the Local Government (Administration) Regulations 1996, if a committee meeting is open to the public or proposed to be open to the public, the local government must give public notice of the dates, times and place at which the committee meetings are to be held in the next 12 months. Once endorsed by the Finance Committee, the 2021 meeting dates will be publicly advertised.

 

It is proposed that the Finance Committee meetings for 2021 be held at 10.00am, in the Wonnerup Committee Room, at the City of Busselton Administration Building, on the following dates:

·        20 January 2021

·        10 February 2021

·        10 March 2021

·        14 April 2021

·        12 May 2021

·        9 June 2021

·        21 July 2021

·        11 August 2021

·        8 September 2021

·        13 October 2021

·        10 November 2021

·        24 November 2021


 

Statutory Environment

The legislation relevant to this report is:

·        Local Government Act 1995

·        Local Government (Administration) Regulations 1996

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

As an alternative to the proposed recommendation, the Finance Committee could propose different dates or times for its meetings to be held.

CONCLUSION

Regulation 12 of the Local Government (Administration) Regulations 1996 requires the local government to give notice of the dates of its Committee meetings that are open, or proposed to be open, to the public. The proposed 2021 Finance Committee meeting dates are presented to the Committee for endorsement. Once endorsed by the Finance Committee, the 2021 meeting dates will be publicly advertised.

TIMELINE FOR IMPLEMENTATION OF OFFICER RECOMMENDATION

The schedule of the Finance Committee 2021 meetings will be advertised prior to the end of 2020.

 


Finance Committee                                                             78                                                          25 November 2020

7.               General Discussion Items

Mr Nottle advised that officers will be bringing a report on interest earnings to the Committee.

 

Mr Nottle advised that briefings on the Long Term Financial Plan (LTFP) may be required to be held at a Finance Committee meeting prior to the adoption of the LTFP by Council.

 

8.               Next Meeting Date

The next meeting will be held on 20 January 2021.

 

9.               Closure

The meeting closed at 11.04am.

 

 

 

 

 

 

 

THESE MINUTES CONSISTING OF PAGES 1 TO 78 WERE CONFIRMED AS A TRUE AND CORRECT RECORD ON ___________________________

 

DATE:_____________________    PRESIDING MEMBER: ___________________________