Council was given a “clean report” for its 2018 financial audit during its regular meeting April 23.
The audit was prepared by third party Rowland, Parker and Associates LLP chartered professional accountants. Gord Parker was present to give his report to council.
There were a “number of discrepancies” in payroll, namely councillors attending events but not being paid for them, according to Parker.
“If you want to be underpaid, that’s your prerogative,” said Parker, stating there were no other issues otherwise.
The town’s payroll is complex with two different unions and part-time employees, but as a whole, Parkers says he’s confident it’s correct.
Mayor Rick Bonnett’s salary was $40,690 for 2018, and with benefits and allowances of $1,163, was paid a total of $41,853.
CAO Alberta Flootman’s salary for 2018 was $154,551 and with benefits and allowances totalling $30,537, was paid $185,088.
As of Dec. 31, 2018, the town had $16.2 million in net financial assets and spent $1.08 million less in actual expenses, including amortization, than it budgeted for in 2018, leaving a $253,010 surplus from consolidated operations, which includes capital, reserves and amortization of its capital assets.
The town’s net financial assets, exactly $16,226, 131, increased from $15,712,485 in 2017.
The town has a borrowing capacity of $11.3 million, based on a calculation of the town’s total revenue of just over $18 million multiplied by 1.5.
The town’s net municipal tax revenue was $7,124, 287 in 2018, up from $6,139,116 in 2017.
Revenue from provincial and bylaw fines in 2018 equaled $79,725, down from $97,542 in 2017.
Protective services, which includes the RCMP, fire services, emergency management, municipal enforcement and Animal Control, had a price tag of $2,116,715 in 2018.
The town’s debt load as of Dec. 31, 2018 is $15.7 million. It had a debt limit of $27.1 million for 2018, so it is within its mandated allowances.
The town’s debt is largely due to its $8.9 million, 25-year lease obligation for the Ponoka Civic Building.
The civic building costs the town a total of $1.1 million per year, which includes the $700,000 annual lease cost and $377,720 in annual budgeted operating costs under the town’s commercial lease agreement for its lease space in the building.
The lease payment on the Civic Centre is $58,333 per month or $700,000 per year.
The town occupies 28,000 square feet of lease space in the civic building, or about 90 per cent. The main floor of the centre is occupied by the library and the Campus Alberta Central (CAC), which is a 5,000 square foot learning site.
The town’ lease cost is offset somewhat by the $125,000 annual sublease payments from the CAC. Some operating costs are also recovered from the CAC’s proportionate share, as well as from the library for its utility costs. The remainder of the library’s operating costs are covered by the town.
Operating costs are budgeted, not actual, and will be reconciled at the end of 2019.
The town may choose to buy out the building at any time during the lease, without penalty, at whatever the current market value of the building is at the time.
The Civic Centre is owned by Thackeray Enterprises Inc., an affiliate of the Landrex Group.
The pre-construction appraisal done in 2017 by the developer for Landrex’s internal use was declared at $10.1 million for the whole building.
The current value of the completed building is unknown.
A response from the town stated that a new appraisal would have to be done if the town decides to buy the building.
The town and the building owner would each need to conduct an independent appraisal and take the average value of the two appraisals to set a current value for the building.
“We knew what we were spending when we went into it,” said Bonnett, adding that overall, the town is in a good place on the balance sheet.
The audit report stated “the consolidated financial statements present fairly, in all material respects, the financial position of the Town of Ponoka as at December 31, 2018 and the results of its operations, change in its net financial assets and its cash flows for the year ended in accordance with Canadian public sector accounting standards.
“The 2018 financial statements have been prepared in accordance with Canadian public sector accounting standards and have been audited based on Canadian generally accepted auditing standards.”
The Municipal Government Act (MGA) Section 278 requires municipalities to submit audited financial statements and an auditor’s report by May 1 of each year.
Council voted in favour of accepting the financial statements and the auditor’s report.