Financial audit shows town finances in good shape

The Town of Barrhead is in a strong financial position.

That is what Wayne Ellerington, of Ellerington LLP, told Barrhead town councillors, when he presented the 2016 financial audit as part of the town’s annual general meeting on April 11.

Under the Municipal Government Act (MGA), municipalities are required to submit a financial audit to the province.

“We have a good report again, meaning we have no restrictions or areas that we felt were empirically incorrect,” he said.

Under the MGA, municipalities are restricted to how much debt they can carry at one time. In the town’s case, it is set at $17,466,798.

Currently, the town is carrying $4,933,540 as part of the $5 million debenture taken in early 2016 — its part of the Aquatic centre’s construction.

Ellerington noted the town’s annual $290,569 payments on the debt are also well under the maximum limit of $2,911,133 imposed under the MGA.

“The other thing to look at is the 25 year debenture lockdown of 3.152 per cent,” he said. “If the town needs to do something in the near future it’s a good time to be borrowing. That lockdown rate is incredibly good, especially with the talk that interest rates will be going up.”

In 2016, the value of the town’s assets increased by $67,628 from $56,563,452, the previous year.

Liabilities increased by $5,663,361, the majority being the debt from the debenture.

“The result is the debt ratio increased to 10.41 per cent from 2.43 per cent, but once again there is nothing unhealthy about that,” Ellerington said.

An oddity in the financial audit, which really isn’t an oddity, that Ellerington wanted to point out is Beaver Brook Estates.

“The carrying value on the balance sheet for Beaver Brook is zero, even though you have significant inventory there,” he said, adding this is due to a quirk in the MGA that values the lot at the amount that they were acquired for.

Ellerington added any infrastructure improvements the town has made to the land are included as capital assets in other categories.

The final category the report touched on was the Aquatic centre.

“During the course of the year you spent $9.2 million,” he said, adding that leaves about $3.2 million that will be spent by the end of 2017.

Part of these 2017 costs will be covered by another contribution from the County of Barrhead of $941,807.

“So if you get the $1.5 million you expect from donations [Agrena Society’s fundraising effort which is currently estimated at $1.2 million], the town only has to dig up another $758,193,” Ellerington said.

Coun. Ryan Warehime noted it is important to remember the other capital projects that were completed in 2016.

“When you look back at the year you don’t always note the progress that has been made,” he said. “Certainly the swimming pool is a big undertaking, but the 51 Avenue infrastructure improvements along with 48 Avenue and major improvements on wastewater are all things we can be proud of and it is important to tell our residents about.”

The AGM was then adjourned due to the lack of public attendance.