FAS-024 - Strategic Real Estate Capital Reserve Fund Policy_2021
Title: Strategic Real Estate Capital Reserve Fund Policy
Subject: Strategic Real Estate Capital Reserve Fund Category: Finance and Administrative Services
Policy No.: FAS-024 M&C Report No.:
Effective Date: 2021-10-04 Next Review Date:
Area(s) this policy applies to: Finance and Office Responsible for review of this Policy:
Administrative Services Finance and Administrative Services
Related Instruments: Policy Sponsors:
M&C No 2021-273 Chief of Staff
Document Pages:
This document consists of 6 pages.
Revision History:
Common Clerk's Annotation for Official Record
Date of Passage of Current Framework:___October 4, 2021_______
I certify that this Policy was adopted by Common Council as indicated
above.
_ ____2021-10-07_____
Common Clerk Date
Date Created: Common Council Approval Date: Contact:
31.06.21 2021-10-04 Finance and Administrative Services
City of Saint John
Strategic Real Estate Capital Reserve
Table of Contents
1. POLICY STATEMENT..................................................................................................................... 3
2. EVALUATION CRITERIA AND PERMITTED USE OF THE FUND ....................................................... 3
3. BUSINESS CASE ............................................................................................................................ 4
4. RESPONSIBILITIES ........................................................................................................................ 5
5. FUNDING THE RESERVE ............................................................................................................... 6
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City of Saint John
Strategic Real Estate Capital Reserve
1. POLICY STATEMENT
1.1. This policy outlines the standards and guidelines that govern the management,
accounting, and evaluation criteria of the Strategic Real Estate Capital Reserve Fund
th
(“the Fund”) as established by Common Council on May 17, 2021.
1.2. The Strategic Real Estate Capital Reserve is subject to compliance with FAS-003
Operating and Capital Budget Policy as well as FAS-005 Capital Budget Policy.
1.3. The City of Saint John (“the City”) established the Fund from the net financial assets
that were returned to the City as part of the of the wind-up of Develop Saint John.
1.4. The Fund is to be exclusively used to support strategic real estate development
Projects (“Projects”) in Saint John.
2. EVALUATION CRITERIA AND PERMITTED USE OF THE FUND
2.1. All Projects must take place in the Saint John City Limits (“Saint John”).
2.2. All Projects must be catalytic in nature and give strong evidence that the completion
of the Project will lead to increased tax base, employment, or population growth, or
considerably increase the quality of life in Saint John (“Growth”).
2.3. The Fund may be used for the acquisition and purchase of land or real estate,
provided the City or its controlled entities retain ownership.
2.4. No more than $400,000 should be designated from the Fund for any specific Project,
including sub-Projects, however Council may approve a larger amount based on the
strength of a business case.
2.5. All Projects must align with PlanSJ.
2.6. Projects must demonstrate how they adhere to one or more of the City’s long-term
Growth plans or strategies.
2.7. Project proposals must be submitted at least 60 days prior to the Project start date.
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City of Saint John
Strategic Real Estate Capital Reserve
2.8. Project expenses incurred prior to obtaining Project approval by Common Council are
ineligible for reimbursement, unless specifically authorized by Common Council.
2.9. All Projects must demonstrate how they will recognize the City’s financial
contributions.
2.10. Legal fees are eligible costs but only if managed by the City or a controlled entity.
2.11. Procurement for Projects must align with the procurement policy of the City.
2.12. The Fund may not be used for capital renewal or the purchase of vehicles.
2.13. All Projects must be substantiated by a Business Case (“Business Case”).
3. BUSINESS CASE
A Business Case must:
3.1.1. Clearly outline the opportunity for the City and address how the Project will
lead to Growth;
3.1.2. Demonstrate good return on investment for the City and include a reasonable
Economic Impact Analysis;
3.1.3. Include a detailed budget with timelines for each expenditure;
3.1.4. List roles and responsibilities associated with Project governance;
3.1.5. List confirmed and unconfirmed funding contributions to the Project;
3.1.6. Outline risks and liabilities associated with the Project;
3.1.7. Outline all in-kind and expenditures expected of the City, for both the up-front
costs of the Project as well as future maintenance;
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City of Saint John
Strategic Real Estate Capital Reserve
4. RESPONSIBILITIES
4.1. Common Council:
4.1.1. Has oversight of this policy
4.1.2. Has sole authority to approve expenditures from the Fund.
4.2. Finance Committee
4.2.1. Is responsible for approving the Capital Budget.
4.3. Growth Committee:
4.3.1. Is responsible for evaluating all Projects.
4.3.2. Growth Committee may:
4.3.2.1. Recommend a Project to Common Council for its approval;
4.3.2.2. Reject a Project proposal outright;
4.3.2.3. Request that the Applicant make changes to the proposal;
4.3.2.4. Require an Applicant return to Growth Committee with a Project
evaluation at the completion of the Project;
4.4. The City Manager:
4.4.1. Shall ensure compliance with the principles and requirements contained in this
policy.
4.5. The Commissioner of Growth and Community Services:
4.5.1. Is responsible for assembling a cross-corporate staff team to carefully review
all Projects and accompanying business cases and provide advice and updates
to Growth Committee and Council on Projects.
4.6. The Commissioner of Finance:
4.6.1. Will develop and update this policy as necessary and present changes to
Council;
4.6.2. Will perform the transfers to and from this reserve as authorized by Council;
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City of Saint John
Strategic Real Estate Capital Reserve
5. FUNDING THE RESERVE
5.1. The Fund is established from $1,625,899 in net financial assets returned to the City
as part of the Wind-Down of Develop Saint John.
5.2. The City may elect to top-up the Fund as part of the annual budget process for the
City upon the recommendation of Finance Committee and approval of Common
Council.
5.3. The City may designate the proceeds of the sale of City owned assets, particularly
land, to be placed in the Fund.
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