2012 Financial Report to Citizens
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Bringing Our Vision To Life FInanCial REPORT TO CITIZENS 2012 Back row (left to right): Don Iveson - Ward 10 Dave Loken - Ward 3 amarjeet Sohi - Ward 12 Bryan anderson - Ward 9 Middle row (left to right): Tony Caterina - Ward 7 Ben Henderson - Ward 8 Mayor Stephen Mandel Kerry Diotte - Ward 11 Ed Gibbons - Ward 4 Front row (left to right): Linda Sloan - Ward 1 Kim Krushell - Ward 2 Jane Batty - Ward 6 Karen Leibovici - Ward 5 MESSaGE FROM CITY COUNCIL With exceptional municipal services, a vibrant arts and by the Real Estate Investment Network as one of the best cultural community, engaged citizens and spectacular North American places to invest in. The Conference Board river valley parks and green spaces, Edmonton is thriving. of Canada also consistently scores Edmonton as one of the Edmontonians enjoy a great public education system, top cities in Canada for economic prosperity. tremendous post-secondary institutions led by the University City Council will continue to capitalize on these strengths of Alberta, MacEwan University, NorQuest and NAIT, as of a robust economy, remarkable growth and a strong well as a variety of unique recreation, shopping, dining and vision to build a city that is alive with energy, boundless family attractions. Edmonton continues to stand tall as one opportunity, unparalleled potential and an extraordinary of Canada’s most dynamic and prosperous urban centres. quality of life. 2012 was a year of tremendous growth in our city. Edmonton recorded high population growth and strong employment growth—both important indicators of a resilient and robust economy. This past year also saw substantial progress on some of our most transformational projects. City Council worked to finalize a financial framework for a new downtown arena, continued development of The Quarters and a master plan for Blatchford, the City Centre Airport Redevelopment project, is expected to be completed in 2013. Edmonton remains home to one of Canada’s most outstanding economies. Few cities have prospects as bright as Edmonton, which stands at the geographic core of Canada’s economic future and the research and industrial workhorse of the province. This positive outlook is reflected in the City of Edmonton’s AA+ credit rating, one of the highest among Canadian cities. Edmonton is also ranked 2 City of Edmonton 2012 Financial Report to Citizens City of Edmonton 2012 Financial Report to Citizens PB With an ambitious vision, exciting new projects and engaged citizens, Edmonton continues to make great strides in shaping itself into a city that is increasingly vibrant, innovative, inclusive and sustainable. Throughout 2012, Edmonton saw strong economic growth, outpacing the rest of Canada and other global economies. The inflation-adjusted growth rate was 3.7% for the city and 4.4% for the Edmonton region. These results are well ahead of the overall growth rates of 1.8% and 3.4% for Canada and Alberta, respectively. While employment, incomes and population rose at very robust rates, the continuing expansion of Edmonton’s manufacturing, construction and professional services sectors was the key contributor to the region’s overall economic performance. 2012 FINaNCIaL RESULTS This report is intended to reduced contractor and consultant costs arising from provide City financial highlights delayed projects, partially offset by less than expected for fiscal 2012. Readers may photo enforcement revenues and decreased gas franchise also access the complete City fees. Increased licensing and permit revenues and reduced of Edmonton Financial Annual government transfers were mostly offset by variances from Report for the year ended budget in related expenses. December 31, 2012 at www.edmonton.ca/ annualReport. Copies are also available for review at each of the public library locations throughout the City. Operating Results Edmonton is a vibrant, growing city and continues to increase services to meet the needs of an expanding population and economy, while maintaining existing services to provide the high standards Edmontonians expect. The approved operating budget for 2012 included a property tax increase of approximately 5%, with 1.5% of that increase specifically directed for neighbourhood renewal. This budget continued to build on the existing services and programs valued highly by Edmonton residents and businesses. City tax-supported operations ended the year with a net surplus of $18.4 million or 1.0% of the overall expenditure budget. This was mainly due to personnel savings and PB City of Edmonton 2012 Financial Report to Citizens City of Edmonton 2012 Financial Report to Citizens 3 Where the money to provide WhereCity services the money comes to from provide City(millions services of $) comes from 993.8 Your Priorities Property tax (millions of $) 920.0 993.8 Dividend and transferProperty fee tax - 153.3 Edmontonians provide valuable input on priorities EPCOR 152.9 920.0 using a variety of channels, including comments Dividend and transfer fee - 135.3153.3 Government transfers* EPCOR 139.1152.9 through the city’s online reporting tools, calls to 311, 124.1135.3 public consultation, contact directly with the Mayor GovernmentFranchise transfers* fees 120.1139.1 and councillors and through the budget public hearing 124.1 Bus and light railFranchise transit fees 121.0 114.3120.1 process. Edmontonians have said that some of their 101.5121.0 top priorities are a safe and clean city, integrated Bus and light railService transit fees 98.3114.3 transportation system, and for Edmonton to be a 101.5 Licenses,Service permits fees 77.5 and parking 63.498.3 leader in environmental advocacy, stewardship, Licenses, permits 77.5 preservation and conservation. Fines and penalties 54.6 and parking 47.663.4 54.6 InvestmentFines and penaltiesearnings 31.1 47.665.6 Ed TelInvestment Endowment earnings Fund 27.731.1 contribution 25.865.6 TransfersEd Tel from Endowment reserves Fund and 19.627.7 dividends from utilitiescontribution/enterprises 25.839.8 TransfersLocal from improvementreserves and 13.319.6 dividends from utilitiesand /otherenterprises taxes 12.239.8 Local improvement 13.3 and other taxes 12.2 2012 2011 * Government transfers include transfers2012 in lieu of tax.2011 Services supported Services(millions of $) supported 327.8 Bus and light rail transit (millions of $) 317.0 318.8327.8 Bus and light rail transitPolice 301.5317.0 318.8 Parks, communityPolice 275.1 and planning 258.4 301.5 Parks, community 170.9 275.1 Roadway and parking and planning 192.9 258.4 170.9 Roadway andFire parking rescue 165.5 159.9192.9 Transfers to reservesFire rescue and 165.5165.5 capital expenditure funding 159.9186.0 Transfers to reserves and 148.9165.5 Corporate administration* capital expenditure funding 142.2 186.0 90.6 148.9 CorporateGeneral administration* municipal 85.9 142.2 The 2012 tax-supported surplus will be transferred to 90.6 Debt principalGeneral repayment municipal 50.8 the Financial Stabilization Reserve (FSR) in 2013, with $9.4 47.1 85.9 49.550.8 million then applied for funding within the 2013 budget, as HousingDebt principaland other repayment subsidies 47.1 approved by City Council. The FSR is maintained to provide 49.5 HousingEdmonton and other Public subsidies Library 39.2 flexibility to address financial risks associated with revenue 37.747.1 39.2 instability and unforeseen costs. The addition to the FSR will EdmontonBylaw Public enforcement Library 31.7 28.937.7 result in a balance of $101.1 million, exceeding the minimum Bylaw enforcement 31.7 level, but well below the target level of one month of 28.92012 2011 expenditures for tax-supported operations, as established 2012 2011 within City policy. During the year, $14.0 million in approved * CorporateFinancial administration Stabilization includes cost of City Council and Mayor’s office. transfers were made from the FSR to fund 2012 expenditures. FinancialReserve Stabilization Reserve(millions of $) 134.7 2012 (millions of $) 91.8 81.1 134.7 2012 91.8 131.8 2011 81.1 91.1 79.4 131.8 4 2011City of Edmonton 2012 Financial91.1 Report to Citizens120.6 City of Edmonton 2012 Financial Report to Citizens PB 2010 79.4 95.3 72.6 120.6 2010 95.3 114.5 2009* 71.472.6 69.0 114.5 2009*2008 71.4 85.0 69.0 85.4 2008 60 70 80 85.090 100 110 120 130 85.4 60 Target70 80Balance90 Minimum100 110 120 130 Target Balance Minimum Where the money to provide City services comes from (millions of $) 993.8 Property tax 920.0 Dividend and transfer fee - 153.3 EPCOR 152.9 135.3 Government transfers* 139.1 124.1 Franchise fees 120.1 Bus and light rail transit fees 121.0 114.3 101.5 Service fees 98.3 Licenses, permits 77.5 and parking 63.4 Fines and penalties 54.6 47.6 Investment earnings 31.1 65.6 Ed Tel Endowment Fund 27.7 contribution 25.8 Transfers from reserves and 19.6 dividends from utilities/enterprises 39.8 Local improvement 13.3 and other taxes 12.2 2012 2011 Services supported (millions of $) 327.8 Bus and light rail transit 317.0 318.8 Police 301.5 Parks, community 275.1 and planning 258.4 170.9 Roadway and parking 192.9 Fire rescue 165.5 159.9 Transfers to reserves and 165.5 capital expenditure funding 186.0 148.9 Corporate administration* 142.2 90.6 General municipal 85.9 Debt principal repayment 50.8 47.1 49.5 Housing and other subsidies 47.1 Edmonton Public Library 39.2 37.7 Bylaw enforcement 31.7 28.9 2012 2011 Financial Stabilization of various City facilities, and revitalize the downtown core Reserve through initiatives such as the Quarters Downtown. (millions of $) Significant projects that progressed during 2012 include the 134.7 North Light Rail Transit (LRT) - Downtown to NAIT, Clareview 2012 91.8 81.1 and Meadows recreation centres, mature neighbourhood 131.8 2011 91.1 rehabilitation and neighbourhood renewal, and Southeast 79.4 to West LRT land purchases and preliminary design.