Agenda of Finance and Council Controlled Organisations Committee

Notice of Meeting:

I hereby give notice that an ordinary meeting of the Finance and Council Controlled Organisations Committee will be held on:

Date: Tuesday 23 May 2017

Time: 1.30 pm (or at the conclusion of the previous meeting, whichever is later)

Venue: Edinburgh Room, Municipal Chambers,

The Octagon, Dunedin

Sue Bidrose

Chief Executive Officer

Finance and Council Controlled Organisations Committee

PUBLIC AGENDA

MEMBERSHIP

Chairperson	Cr Mike Lord
Deputy Chairperson	Cr Doug Hall
Members	Cr David Benson-Pope	Mayor Dave Cull
	Cr Rachel Elder	Cr Christine Garey
	Cr Aaron Hawkins	Cr Marie Laufiso
	Cr Damian Newell	Cr Jim O'Malley
	Cr Chris Staynes	Cr Conrad Stedman
	Cr Lee Vandervis	Cr Andrew Whiley
	Cr Kate Wilson

Senior Officer Gavin Logie, Acting Chief Financial Officer

Governance Support Officer Jenny Lapham

Jenny Lapham

Governance Support Officer

Telephone: 03 477 4000

Jenny.Lapham@dcc.govt.nz

www.dunedin.govt.nz

Note: Reports and recommendations contained in this agenda are not to be considered as Council policy until adopted.

Part A Reports

Financial Result - Period Ended 31 March 2017

Department: Finance

EXECUTIVE SUMMARY

1 This report provides the financial results for the period ended 31 March 2017 and the financial position as at that date.

RECOMMENDATIONS

That the ELT:

a) Notes the Financial Performance for the period ended 31 March 2017 and the Financial Position as at 31 March 2017.

BACKGROUND

2 This report provides a commentary of the financial performance of Council for the period ended 31 March 2017 and the financial position as at that date.

DISCUSSION

3 The net deficit (including Waipori) for the nine months to March 2017 was
$10.860 million or $7.692 million unfavourable to budget.

4 The unfavourable variance against budget was due to the following:

· $4.729 million - lower than expected grants revenue mainly as a result of Transport undertaking less subsidised roading work than expected (both operational and capital).

· $1.894 million – higher asset ops and maintenance costs. Parks costs were unfavourable $1.488 million mainly due to the increase in green space maintenance contract costs and the unbudgeted management contract associated with the University Oval. Property costs were unfavourable $750k mainly due to deferred maintenance issues for a number of properties now being addressed.

· $2.245 million – fees and levies expenditure was higher than expected due to: unbudgeted building assessments including structural and seismic engineering; unbudgeted fees associated to the district plan (2GP); contract review and audit costs in Parks; consultant backfilling of vacant positions in Transportation; resource consent processing and costs associated with appeals and compliance; and additional Building Services expenditure to assist with the building consent processing backlog.

· $3.446 million – higher depreciation costs as a result of the revaluation of Water and Waste assets effective from 1 July 2016.

5 These unfavourable variances were partially offset by:

· $2.093 million – higher than expected other operating revenue. This favourable variance was mainly due to: Three Waters revenue being $606k up on budget with water sales, trade waste charges and recoverable revenue being higher than expected. Property revenue was favourable $436k, largely due to better than expected occupancy rates for housing. Regulatory Services revenue was favourable $206k due to increased building consent activity and animal control infringement fees. Parks & Recreation income was also up due to unbudgeted income from the Waikouaiti forest harvest. Olveston revenue of $399k was not budgeted in the current year.

· $781k – materials supplies and services expenditure was less than expected largely due to Corporate Policy expenditure on climate change and sustainability being less than budgeted and the delayed timing of key projects under the Grow Dunedin Partnership.

· $677k – favourable grants expenditure. The $500k grant budgeted for the new hockey turf at Kings High School has not been required yet.

· $1.712 million – Waipori Fund, resulting from fair value gains across a number of investment portfolios. There was a significant increase in investment values during February/March partially driven the impact of a weaker NZD on international equity holdings.

6 Capital expenditure was less than budget by $20.839 million. Project delays have arisen across a number of portfolios while project scoping and design is finalised.

7 Total Council debt as at 31 March 2017 was $204.900 million or $11.908 million lower than budget. This variance reflected early debt repayment resulting primarily from the lower than expected expenditure on capital projects.

OPTIONS

8 Not applicable.

NEXT STEPS

9 Not applicable.

Signatories

Author:	Lawrie Warwood - Financial Analyst
Authoriser:	Gavin Logie - Acting Chief Financial Officer

Attachments

	Title	Page
a	Summary Financial Information	19
b	Statement of Financial Performance	20
c	Statement of Financial Position	21
d	Statement of Cashflows	22
e	Capital Expenditure Summary	23
f	Borrowing and Investment Policy	24
g	Statement of Public Debt	25
h	Summary of Operating Variances	26
i	Financial Review	27

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

The financial expenditure reported in this report relates to providing local infrastructure, public services and regulatory functions for the community.

Fit with strategic framework

	Contributes	Detracts	Not applicable
Social Wellbeing Strategy	☐	☐	☒
Economic Development Strategy	☐	☐	☒
Environment Strategy	☐	☐	☒
Arts and Culture Strategy	☐	☐	☒
3 Waters Strategy	☐	☐	☒
Spatial Plan	☐	☐	☒
Integrated Transport Strategy	☐	☐	☒
Parks and Recreation Strategy	☐	☐	☒
Other strategic projects/policies/plans	☐	☐	☒

This report has no direct contribution to the Strategic Framework, although the financial expenditure reported in this report has contributed to all of the strategies.

Māori Impact Statement

There are no known impacts for tangata whenua.

Sustainability

There are no known implications for sustainability.

LTP/Annual Plan / Financial Strategy /Infrastructure Strategy

This report fulfils the internal financial reporting requirements for Council.

Financial considerations

Not applicable – reporting only.

Significance

Not applicable – reporting only.

Engagement – external

There has been no external engagement.

Engagement - internal

The report is prepared as a summary for the individual department financial reports.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

There are no known implications for Community Boards.

Finance and Council Controlled Organisations Committee

23 May 2017

Waipori Fund - Quarter Ending March 2017

Department: Finance

EXECUTIVE SUMMARY

1 The attached report from Dunedin City Treasury Limited provides information on the results of the Waipori Fund for the quarter ending 31 March 2017.

RECOMMENDATIONS

That the Committee:

a) Notes the report from Dunedin City Treasury Limited on the Waipori Fund for the quarter ending 31 March 2017.

BACKGROUND

2 Not applicable.

DISCUSSION

3 Not applicable.

OPTIONS

4 Not applicable.

NEXT STEPS

5 Not applicable.

Signatories

Author:	Richard Davey - Treasury Manager
Authoriser:	Gavin Logie - Acting Chief Financial Officer

Attachments

Title

Page

Waipori Fund Quarterly Report - March 2017

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

This report relates to providing local infrastructure, public services and regulatory functions for the community.

Fit with strategic framework

	Contributes	Detracts	Not applicable
Social Wellbeing Strategy	☐	☐	☒
Economic Development Strategy	☐	☐	☒
Environment Strategy	☐	☐	☒
Arts and Culture Strategy	☐	☐	☒
3 Waters Strategy	☐	☐	☒
Spatial Plan	☐	☐	☒
Integrated Transport Strategy	☐	☐	☒
Parks and Recreation Strategy	☐	☐	☒
Other strategic projects/policies/plans	☐	☐	☒