Mayor’s Annual Financial Report: 2014-2015

Presented by Mayor William Steinberg at the November 2, 2015, Town Council meeting

In compliance with Article 474.1 of the Cities and Towns Act it is my pleasure to present the annual report on the financial situation of the Town of Hampstead. This report includes:

Highlights of the 2014 Financial Statements
Three-year program of capital expenditures
Preliminary information regarding the financial situation for 2015
General orientation for the 2016 budget
Remuneration of elected officers
List of all contracts involving an expenditure exceeding $25,000
Concluding remarks
Documents for download

 

HIGHLIGHTS OF THE 2014 FINANCIAL STATEMENTS

The financial statements for 2014 were audited by the Town’s external auditors “Goudreau Poirier”, who confirmed that these portrayed, in all important aspects, a true picture of the financial situation of the municipality for the fiscal year ended December 31st, 2014. Their report was tabled at the Regular Meeting of the Town Council held on Monday, June 15, 2015.

Unrestricted operating surplus

Per the 2014 Financial Statements, the operational surplus for the fiscal year was $1.834M.

This amount was added to the previous accumulated surplus of $2.611M from which the following was appropriated:
- $234.5 thousand for the purchase of a Watering truck;
- $65 thousand for Centennial celebrations;
- $20.5 thousand as a reserve for the 2017 municipal elections;
- $15 thousand as a reserve for a new public security vehicle;

Adding to this the closing balance of the Town’s working fund of $192.8 thousand, the overall accumulated surplus was $4.303M.

Long-term debt

At the end of 2014 the Town of Hampstead’s debt stood at $10.442M (2013 = $12.080M).  From this amount a debt figure of $9.331M (2013 = $10.875 M) results when we net out the grants to be received for certain projects. The table below provides estimated payments on long-term debt.

Estimated capital payments on long-term debt

MATURITY $
2015 738 000
2016 765 500
2017 758 300
2018 733 900
2019 761 600
2020 and + 6,684 600
TOTAL 10,441,900
GRANTS TO BE RECEIVED (1,056,160)
TOTAL NET LONG-TERM DEBT 9,385,740

Note: The numbers are based on the 2014 financial statements as of December 31, 2014. In fact, due to an accelerated pay down of capital in 2016, the future payments are expected to be lower than shown in the table.

Capital expenditures

As the restoration of our infrastructure remains one of the top priorities, capital expenditures in 2014 totalled $742.4 thousand and spanned a variety of different projects, mainly for infrastructure rehabilitation (sidewalks, a splash park in Councillor Park and road pavement). The table below provides details of the 2014 capital expenditures.

CATEGORY PROJECT 2014
Information technology Hardware- computers & server 13 614
Municipal installations Town Hall, CSR & PW building renovations 16 091
Infrastructure rehabilitation Water distribution network 20 698
  Parks & green areas 314 623
  Roads & sidewalks 282 393
Vehicles and equipment Tools, machinery & equipment 33 547
  Vehicles 61 398
  CAPITAL INVESTMENTS 742 364

Overall, the 2014 financial results indicate that the Town has fulfilled its commitments with respect to the budget adopted and finished the year with an operating surplus of $1.834M, and this, with the local tax increase below inflation at 1.75% for the average single-family home.


THREE-YEAR PROGRAM OF CAPITAL EXPENDITURES

The principal investments planned in the current three-year capital expenditures program reflect our desire for a diverse and vibrant development of the Town. The projects for 2015 are nearing completion with some final work extending into the coming fiscal year. The orientations for the 2016-2017-2018 capital expenditures program are being formulated.

This year, Hampstead has continued the infrastructure renewal program, focussing on road, sidewalk and water main rehabilitation as well as an Applewood Park beautification project. Added to this was the continuation of a large vehicle replacement program. Financing for these projects came principally from grants and accumulated surplus.

As in past years, a constant rejuvenation of our vehicle fleet, roads and street lights, park facilities, computer hardware/ software as well as various machinery and equipment allow for an enhanced efficiency of operations.

In summary, we will continue to focus on our longer-term plan to recover and build a renewed infrastructure while ensuring that our Town is kept clean, attractive and safe.


PRELIMINARY INFORMATION REGARDING THE FINANCIAL SITUATION FOR 2015

We continue to keep close control over our expenses while maintaining the quality of services offered to, and expected by, Hampstead residents. Of equal importance, we continue to prioritize open and frequent communication to ensure that our residents are informed and involved in our many Town initiatives.
With respect to revenues for the year 2015, we expect gains generated from:

- A non-compliance penalty from the Belvedere project
- Non-budgeted insurance proceeds per a Town Hall water damage claim plus auction proceeds from the sale of obsolete vehicles/equipment

Regarding the expenses we forecast savings on:

- Legal fees, professional studies and claims
- Blue collar overtime costs

A surplus appropriation is forthcoming to cover capital expenditures incurred under the current triennial program.


GENERAL ORIENTATION FOR 2016  BUDGET

The Director General of the Town in cooperation with Council and upper management is actively preparing the 2016 budget based on identified needs while keeping under consideration our residents’ limited capacity for tax increases. The coming budget will concentrate on historically demonstrated requirements and the credit allocations will be in sync with objectives and key results expected from each department.

We will take advantage of this opportunity to review and assess requests addressed to the Town Council by residents in order to improve the quality of life in the community. As in the past, our objective is not only to maintain that which has been acquired but to go one better in response to current financial and environmental realities. The final results will subsequently be presented to you during a special meeting in December where the budget forecast for 2016 and the next three-year capital expenditures program will be discussed.

We will take into consideration all necessary priorities and needs not only to ensure a sustainable and beneficial development but to promote an enviable quality of life for our residents while controlling tax increases. Nonetheless, a challenge we are still faced with in the upcoming year is to manage cost increases occurring in such areas as vehicle maintenance, the cost of repair/maintenance of aging Town buildings and inflationary price hikes.


REMUNERATION OF ELECTED OFFICERS

As members of the Town Council, an annual remuneration plus an annual allowance for expenses related to these functions is received. This remuneration is in accordance with the provisions of the Act respecting the remuneration of elected municipal officers. The table below provides details on the 2015 remuneration and allowances.
 

Title Town
Remuneration
Town
Expense
Allowance
Agglomeration
Remuneration
Public Security
Commission
Remuneration
(note 1)
Mayor $36,687 $15,976 $10,999 $10,999
Councillors (6) $11,112 $5,556    

Note 1: Maximum remuneration to be received should all meetings be attended in the current year.

LIST OF ALL CONTRACTS INVOLVING AN EXPENDITURE EXCEEDING $25,000

In accordance with the law, we have deposited with the Public Affairs and Registry Department the list of all contracts involving expenditures of more than $ 2,000 concluded during the period from November 2014 to October 2015, with the same contractor when all these contracts include a total cost exceeding $ 25,000. This list shows for each contract, the name of each contractor, the purpose of the contract and the amount of consideration.

To view this list, please click here.
 

CONCLUDING REMARKS

As shown in this report the financial health of the town is excellent. While we face some financial challenges as we enter 2016, I remain confident that we will keep local tax increases below inflation as we have for the past eight years. However, we will have to be extra vigilant and scrutinize all expenditures carefully in order to secure the quality of services and the sound management of public funds rightfully expected by our residents.

In order to increase knowledge of and accessibility to municipal management, we are continuing to develop our communication tools and approaches. Please rest assured that we will spare no effort to ensure that Hampstead remains a peaceful, happy, healthy, and safe community. Let us continue to build a better tomorrow, together. Your councillors and I sincerely thank you for your support.

And last but not least, the success of this Town is built on the contributions and hard work of its employees. I take this opportunity to emphasize the work of all our Town employees, the able employees at Town Hall, the blue collars who maintain our streets, the Recreation staff for our programs, and our Public Security Agents who keep our Town safe. I thank them all for making Hampstead the wonderful community that we enjoy so much.


Dr. William Steinberg
Mayor, Town of Hampstead


DOCUMENTS FOR DOWNLOAD

To view the report in its entirety, please click here.