![Working to unify Thunder Bay would help build the city stronger](https://www.netnewsledger.com/wp-content/uploads/2015/03/City-Hall-Spring.jpg)
THUNDER BAY – NEWS – Due to some significant, one-time costs that were lower than expected and an ongoing focus on cost containment, the City ended 2017 with a surplus of $5.6 million in tax-supported and $2.8 million in rate-supported operations.
“It’s good news that we had a few significantly lower costs in expenses such as legal and insurance, coupled with our ongoing efforts at cost containment,” said Norm Gale, City Manager. “This allows us to build on our reserve fund strategy to protect against future, unexpected costs and leverage funds from senior levels of government. This approach was endorsed by council`s Audit Committee.”
City Administration will be bringing a recommendation to City Council on May 28 that the surplus of $5.6 million be transferred to reserve funds as follows:
- $900,000 to Insurance Reserve Fund
- $500,000 to Legal Fee Reserve Fund
- $1.1 million to Stabilization Reserve Fund
- $3.1 million to Renew Thunder Bay Reserve Fund
“Increased funding to reserve accounts will help maintain our strong credit rating with improved debt to reserve ratios and financial sustainability,” said Linda Evans, City Treasurer and General Manager of Corporate Services & Long-Term Care.
The tax-supported variance is comprised of the following:
- Favourable variances in Police, legal fees and insurance claim costs ($2.0 million)
- Department savings resulting from staff turnover reduced overtime, increased revenues and cost containment efforts ($1.9 million)
- Higher than forecast corporate revenues and lower borrowing costs, offset by higher taxation related expenses ($600,000)
- Corporate energy savings ($600,000)
- Other corporate savings ($500,000)
The favourable variance of $2.8 million in rate-supported operations was transferred to reserve funds in accordance with long-term financial plans. Reduced service calls due to milder winter, lower energy costs, staff turnover and higher than forecasted revenues led to the favourable variance.