Audit Cttee minutes IV

In the last in our series on the audit Cttee minutes we offer these final gems:

The Chief Administrative Officer directed attention to the Deed Transfer Tax line item on page 21. Although we exceeded expectations last year there is increased uncertainty and  vulnerability with respect to this revenue stream in future years.
Councillor MacKay confirmed that real estate sales have been in decline in recent months. Director Porter noted that Deed Transfer Tax was down in this quarter compared with the first quarter last year.

We think one can certainly argue that the tax has had a negative impact on house sales, and as the auditor rightly points out it is an unreliable source of “income” for the Town. Scrap it we say.

Now here’s another interesting insight. The less water you use the more you will pay. Huh? Say again?

Responding to a question from Councillor Zimmerman, the Chief Administrative Officer noted that Environmental Health Services revenues indicated on page 22 are down to $301,174 from the budget amount of $341,500. This represents sewer fees charged to customers based on the amount of metered water. Residents are now utilizing a number of conservation actions and furthermore the number of university students living on  campus and throughout the Town has declined. Water consumption was also reduced due to the fact that last summer was not a dry summer, and there was less watering of lawns, etc.
Mr. Duffett confirmed there is a downward trend in water and sewer user fees over the last three or four years.
The Chief Administrative Officer cautioned members, indicating that if the trend further declines the Town will have no other option than to seek water rate increases
through the Utility Review Board.

If we use more water we can avoid higher rates? Somehow that seems all backwards. The Town seems to consider water management a source of revenue rather than a Town service. Later on in the minutes when discussing the Statement of Financial Activities of the Water Utility Operating Fund the auditor points out –

All together the water utility had a net surplus of $50,823 bringing the total accumulated surplus to $215,042. Once gain Mr. Duffett drew attention to the fact that metered sales have declined considerably from expectation. The budget was $720,000 with actual sales coming in at $674,491.

Somehow we didn’t think the Town was in the business of selling us water for a profit/surplus, did you? But their words betray them.

Here’s another zinger.

Responding to a question from Deputy Mayor Wrye, the Chief Administrative Officer confirmed the reduction in the equalization grant from a budget of $95,236 to $50,000. He noted that this was the first year where the Town budgeted for and received full one hundred percent residential taxation equivalent grant funding on the university residences. With respect to the grant calculation this has been converted into increased assessment, and the calculated increase in assessment means the Town’s ability to pay has gone up resulting in a sizeable reduction in the grant to the Town. Basically the Town gets the minimum $50,000 grant that is available for towns.
Responding to a further question from Deputy Mayor Wrye, the Chief Administrative Officer confirmed and agreed that if the Town had a higher number of dwelling units or if the dwelling units within the Acadia residences were counted in the calculation the Town would be able to achieve a higher grant level.

Was this behind the R1 debacle? Higher density = higher grant. We think this would be selling Wolfville’s birthright [attractiveness] for a mess of pottage [a higher grant] but that’s just us.

Mr. Duffett reviewed the Non-consolidated Statement of Financial Position of the General Capital Fund.
Responding to a question from members, Mr. Duffett acknowledged the significant increase  in cash and cash equivalent of $35,449 last year to $588,208 this year. This is the total amount held in the various bank accounts within the general capital fund.

After all this the Council members adjourned to an in-camera session “as required by Town policy.”

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