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2009-07-27_Agenda Packet--Dossier de l'ordre du jourCity of Saint John Common Council Meeting Monday, July 27, 2009 Committee of the Whole 1. Call to Order 5:30 p.m. - 7:00 p.m. Lily Lake Pavilion Building at Rockwood Park 1.1(a,b,c) Rockwood Park Presentation to Council 7:30 p.m. 8th Floor Boardroom City Hall 1.2(a,b,c,d) 2008 Audited Financial Statements 13 Employment Matter 10.2(4)(j) City of Saint John Seance du conseil communal Le lundi 27 juillet 2009 Comite plenier 1. Ouverture de la seance De 17 h30 a 19 h, pavillon Lily Lake au parc Rockwood 1.1 (a, b, c) Presentation relative au parc Rockwood faite au conseil 19 h 30 Salle de conference, 8e Rage, hotel de ville 1.2 (a b, c, d) Etats financiers verifies de 2008 13 Questions relatives a 1'emploi — paragraphe 10.2(4)(j) 0 City of Saint John Seance du conseil communal Le lundi 27 juillet 2009 Comite plenier 1. Ouverture de la seance De 17 h30 a 19 h, pavillon Lily Lake au parc Rockwood 1.1 (a, b, c) Presentation relative au parc Rockwood faite au conseil 19 h 30 Salle de conference, 8e Rage, hotel de ville 1.2 (a b, c, d) Etats financiers verifies de 2008 13 Questions relatives a 1'emploi — paragraphe 10.2(4)(j) io '00 0 0 0> 0 72,70, �u ca 3: cn M" EO On ...:.a �F I cu EI LO co 3: L. 0 C/) rr�r LL U Q. O Z 0 CL x w C/) 4 is U) is 1 1 0 Ach c U) LL 0 i L co LL 2:% C O U LAC L 0 CL. .L 0 0 U) U i 0 J cn O /L � I..V 0 0 .c:: cV/'� i U) co W, (D En z 0 cn L cm 0 L. Cl. V C� m L VJ cn a) c� J cn H L Q ^L U co 0 m a� E E =3 cn J _.1 Q CL i L L I..L. 0 U 06 co U 0 mil l� �l U 0 U 1 • J N O N O C Ca u J N O (� J i IVO c 0 U) sl? cu a cu le U) (D 061, C/) >t 0 co r) co (1) En Wr 1 on U O C C: N 4-0 C W L Q U LL 1 LJ cu �I U U) m II U U 06 N W Ncu L. O CL L Am L C6 N C L U �, � V U O �J 0 0o C i O U 06 0 m m 0 0 (0 0 0 U (Q Q1 O cu �r C N rm U J ■ u A.-O t � Q i Cl) Cl) 4-1 I1 LL L. N L.. 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On behalf of the Board of Directors, I welcome you to the W. Franklin Hathaway Pavilion on Lily Lake; or as is more commonly know by the citizens the Lily Lake Pavilion. We are extremely pleased and honored that you have agreed to hold a Committee of the Whole meeting at the Pavilion and to allow the major stakeholders in Rockwood Park the opportunity to make a presentation to Council. This evening you will hear from two organizations that have a long history with the Lily Lake Pavilion and Rockwood Park; the Saint John Horticultural Association, and Lily Lake Pavilion Inc. Both organizations are committed to the future development of Rockwood Park. It has come to our attention that some members of Council, as well as some citizens, do not frilly understand the relationship between the three organizations and the City of Saint John. Let me The Lily Lake Pavilion; is governed by a volunteer Board of Directors nominated by the Saint John Horticultural Association and the W. Franklin Hathaway Trust. (Insert a slide of organizational structure) I would like to introduce the directors here this evening, and ask that they stand as their names are being read; Bill Farren, Donna Gates, David Hayward, Bill Merrifield, Gordon Mouland, Jim McAllister, Chris Pyne, Pat Riley, Carolyn Van derVeen, and Alanna Waberski. Also members of our Board who could not be here tonight are Heather Acker, Jennifer Milbury and Tom Tracey. These directors are community minded citizens who give freely of their time and talents to govern the operations of the Pavilion. The day to day operations of the Pavilion is managed by our Facility Manager Cathy Taylor. We are very fortunate to have such a talented manager. In addition we employ 3 I well trained staff on both a fiilltime and part time basis to operate the banquet facilities, staff Lily's Cafe and provide many community programs for the citizens. The purpose of our presentation this evening is to provide you with an opportunity to: 1. Witness the completion of Phase 1 of the Rockwood Park Re- development Project, 2. Observe the operation of our day camp for disadvantaged children (as some of you saw earlier), 3. Participate in the public announcement of the sponsorship for our 2010 Pond Hockey tournament, 50 4. Become committed to the continuation of the Rockwood Park Re- development Project, S. Make the future recreational programs and projects in Rockwood Park a priority for the Management of the City of Saint John, 6. Improve the security in Rockwood Park. The revitalized Pavilion that you are meeting in tonight would not have been possible without the dedication and commitment of the late Wallace MacMurray. Wally's determination that the building would not continue to be a disgrace to the community inspired many citizens and corporations to step forward and provide the necessary funding to restore this building. Wally spent the last years of his life committed to the restoration of the Pavilion. As the Past President of the Saint John Horticultural Association, he formed a three person committee of the Directors of the Association and challenged the committee to find the necessary funding for and to complete the design of the renovation to the Pavilion. Through Wally's initiatives the committee formed a partnership between the Association and the W. Franklin Hathaway Trust to spearhead the financing of the restoration of the building. The members of the W. Franklin Hathaway Trust were attempting to establish a labour museum to recognize the contributions made by the district labour organizations to our community. They saw the renovation of the Pavilion as a way of investing their fiends in the community and providing for the requirements outlined in the Hathaway Trust. If you have not had an opportunity to view the Labour Museum, which is located in the room next to this hall, I would encourage you to do so after your meeting. There are many who answered Wally's challenge to assist in the restoration of the Pavilion. I direct your attention to the far wall to see the hundreds of commemorative plaques purchased by the citizens to assist with the financing of the restoration. In the front lobby there are additional plaques recognizing those citizens or corporations who provided significant financial contributions. It is always risky to publicly acknowledge certain corporations, given the fact that some may feel left out. However, I would be remiss if I did not acknowledge the financial contributions to the Pavilion by Canaport LNG. If it were not for Jorge Cicarelli the Pavilion would never have been refurbished. At the I O' hour when we were prepared to "throw in the towel ", due to a $450,000 shortfall in the financing, Canaport LNG provided the necessary funds to allow us to complete the project. The directors are proud of the fact that not only do we have over $2M invested in the Pavilion and associated equipment with no debt; we have a building for which the community can be proud. (I would now call upon Ian ,Stead, Pi-esideut of the Saint John Hoi-ticultui-al Association foi- a pi-eseutatiou f -om theii- dii-ectoi-s) 51 IAN STEAD PRESENTATION ADDRESS TO COMMON COUNCIL by IAN STEAD, PRESIDENT, SAINT JOHN HORTICULTURAL ASSOCIATION YOUR WORSHIP THE MAYOR AND COUNCILLORS - I stand before you as President of the Saint John Horticultural Association (SJHA), the former owners of Rockwood Park. In 1967, Centennial Money was available for municipal parks and at that time, the SJHA transferred the lands to the City of Saint John to avail ourselves of these funds. Our Association has a strong sense of duty with respect to the well -being (both natural and physical) of Rockwood Park (RP) and also are very interested in its success as a recreational venue for the citizens of Saint John. The most important challenge for the stakeholders is to increase the usage. What you presently see before you, Lily Lake Pavilion (LLP), its renovation, and Part of Phase I of RP Redevelopment have already increased the usage of the Park. Rock climbing, children's programs, canoe courses, the Pond Hockey Tournament, the Triathlon, various walks for charity, all increase the use of RP. You should be here to watch the school children run around Fisher Lakes, it's exciting!!! The City has a plan in its possession - the 1988 Park Master Plan, which if implemented would keep this energy ongoing and growing. This Plan needs to be taken off the shelf, updated (this will cost) and the City has to make a sustaining contribution to RP. I noted in this Plan that at that time the annual contribution in 1988 dollars suggested was $744,000 which included a $220,000 subsidy to the Zoo. RP could have the following, not to be all inclusive or exclusive: 1. chalets for rent year round 2. accommodation for summer camps 3. well- defined trail systems 4. RP with enough planning could be promoted as a tourist destination, with accommodation, food and activities Yes, I know this costs money, but if there is enough determination, things will happen. Without the vision of SJHA's past - president, the late Wallace D. MacMurray, you would not be sitting here in this structure that was slated for demolition. Things do happen! In closing, 52 1. SJHA requests that the Rockwood Park/ Lily Lake Development Plan be completed as soon as possible and the entrance to the park be tendered immediately, and, 2. the Master Plan be revisited and updated immediately, consulting stakeholders, and, 3. the City define its commitment to the Park. Robert Capson Presentation Part Two During the past year the Pavilion has become the place to be for many citizens; from international flavored dinners hosted by Canaport LNG, Greekfest, corporate meetings and banquets, wedding receptions, seasonal festivals for the youth and the 2009 Pond Hockey tournament. However it also became evident that we could not sustain the facility and meet operating costs from only the rental of the banquet hall. Many citizens commented that we needed to make the Pavilion a destination place and provide services for those who come to the Park to walls, participate in the programs offered or to skate in the winter months. To meet our financial requirements and to address the comments of the citizens we opened Lily's Cafe in December last year. We have been extremely pleased with the reception this cafe has received from the citizens of Saint John as well as the tourists who have visited our city, particularly those who have stayed in the Rockwood Park Campground. With the recent expansion of the Cafe to the deck area we have provided a facility unique in the city. A great meal on the shore of a beautiful lake! All we need is good weather. The directors are committed to operate this facility and meet financial requirements form our internal cash flow. We will not be soliciting the community to meet operating costs. However, as is stated in our mission statement "Our mission is to be a shining example of a modern coiiiiiiiiviity- iiiividcL/ facility that gives back. The Pavilion itself, and t ie f tnas generated fi-om its irork, provide memorable, reirardiug recreational experiences f )r all the people of Saint John " Rockwood Park Re- development Project We want to thank the Council and Senior City Management for their commitment to the completion of Phase 1 of the Rockwood Park Re- development Project. As you entered Rockwood Park this evening you observed the new road, new lightening, the landscaping and the development around Lily Lake. This portion of the project has made a significant improvement to the Park entrance. In addition we certainly have to thank Brunswick Pipelines for their significant contributions to fiend the re- development of the Rockwood Park including the main entrance. Their contribution of over $5M will go a long way to make Rockwood Park the premier park in the province. Past and Future Program and Events in Rockwood Park 53 The staff of the Pavilion, in conjunction with the staff of the City of Saint John's Leisure Services department, has sponsored many community programs and events. As you witnessed earlier today we are hosting our first day camp for underprivileged children this summer. By the end of the summer season we will have provided a day camping experienced for over 300 children at no cost to their parents. (I irould uoij) ask Cathy Taylor, the Facility Manager cif the Pavilion and Helen Bridgeo, to outline some of the past events and our plans for fixture programs) Cathy Taylor & Helen Bridgeo Presentation Thank you your worship and members of council for allowing us to present our vision for the Lily Lake Pavilion and Rockwood Park to you this evening. To say we are proud and excited about the changes that have already taken place in the Park would be an understatement. We are ecstatic! I think you will agree that by working together, we have turned this sleepy urban park into a world class recreation facility. A couple of weeks ago, Rockwood Park hosted a canoe dance workshop and demonstration that was facilitated by the President of the Ontario Recreational Canoe and Kayak Association, Mr. Gordon Haggert. In Mr. Haggert's words "you have an awesome water /sports facility here ... better than what they have in any Ontario city." We tend to take it for granted sometimes since this world class facility is located in our own back yard. As you have already heard from Bob, Rockwood Park and the Pavilion have developed a fantastic partnership that we are looking to continue and grow. Helen and I are here tonight, representing all stakeholders in the park, to bring you up to date on what we've been up to in the park since our last presentation to council in 2007, and what the future could hold for the Park. 54 Helen: Rockwood Park is enjoying a lot of attention these days! We are front and center with many major charitable and recreation based activities. We have a wonderful working relationship with all park stakeholders, who truly love this park and work extremely hard to bring life to the Park. Rockwood Park played host to hundreds of community events last year and we expect a huge increase next year, as more and more people realize the potential and resources within the park. I want to give you a brief power point presentation on the events we have hosted in the past and give you a chance to experience what really happens here in the park everyday, year round. Let's start with • The Autism walk • Valiant Kids Help Phone Walk • Hospice Fundraiser Walk • Safe Kids Expo • Mothers Against Drunk Driving Awareness Walk • Fishing Derby in co- operation with Hammond River Angling Association • School Programs including: Cross Country Races • Lost in the Woods School Program • Velo New Brunswick Bike Races • Summer Beach Programs Fisher Lakes • Summer Beach Programs Lily Lake • Kids & Cops Expo in Partnership with Big Brothers/Big Sisters • Community Gardens Weekly Social • Canada Day Events in the Park • Canoes On the Lake 55 • Kayaks on the Lake • Boys and Girls Club Beach Day • Rock Climbing at the Park • Campground Entertainment • Greek Festival ( 2 Slides) • New Brunswick Day at the Park • Numerous Corporate Events and Picnics • Seniors Cards in the Park • Nordic Walking Clinics • Fall Community BBQ and Corn Boil • Halloween Kids Party ( 3 slides) • Christmas Social and Open House • Winter Carnival • Winter Fest in co- operation with the Town of Rothesay and Quispamsis • Winter Blast Community Centers Gathering • Pond Hockey Tournament • Easter Bunny visits the Park • Easter Wagon Ride All of the events I have presented to you are already booked here again next year. We have also already booked the CIBC Run for the Cure, the Terry Fox Run and the Greek Festival for next year. Rockwood Park is on the move. Cathy: Our vision is to develop and market Rockwood Park under the banner "Destination Rockwood Park- Four Seasons of Recreation ". By promoting health and wellness through active living to our citizens and tourists alike we envision Rockwood Park as the leader in recreational pursuits for all levels of fitness and interests. Working with partners such as Leisure 56 Services, Tourism Saint John and the new DMO, Daytripping, Rockwood Park Golf Course and Driving Range, The Cherry Brook Zoo, and Rockwood Park Stables we envision offering a full itinerary of activities that will showcase Rockwood Park and the Hatheway Pavilion as a cultural, recreational and entertainment center for all citizens of Saint John on a regular basis, not just for special events. Imagine if you will the Pavilion and Rockwood Park providing the following recreational programs free of charge for our citizens to enjoy: • Family Movie night in the Park — Bring your own lawn chairs and enjoy free popcorn and family entertainment • Shakespeare in the Park — Enjoy an afternoon of cultural entertainment by the many talented performers in our city • Workers Wellness Walks and Talks — Park the car, and get on those sneakers and hit one the many fantastic trails in the park led by a health and wellness professional • Family Fun Days — Every Sunday you can count on Rockwood Park providing an afternoon of fun for the whole family with free entertainment, clowns, face painting and special guests • Rockwood Park Summer Day Camps — Sign up the kids for high adventure utilizing all the elements of the Park • Bonfire Sing Along — Bring the kids and your friends to a musical experience by the lake. Don't forget the marshmallows!! • Summer Canoe Clinics — learn how to canoe or kayak for lifelong enjoyment on the water • Fauna and Foliage Horticultural Walks and Talks — learn all about the plants and flowers in the park and learn how to create your own park right in your own backyard. 57 • Grow Your Own Garden Party- Enjoy the benefits of gardening in your very own garden. Join us for a community garden social every week. • Seniors Cards in the Park — bring your love of the game and enjoy friendship and fun at this weekly social activity • Red Cross Certified Learn to Swim Programs- Free swimming certifications from a professional instructor. • School Rowing Programs — Join a team at your school and compete at the Provincial level of rowing • Pond Hockey for Kids — The love of the game starts here! Join up for weekly organized games. • Snow Shoeing for Health — A great winter activity for all levels of fitness. Strap on the shoes and enjoy your day at the Park In order to achieve our full potential, we need the resources and personnel to accomplish our goals. We are investigating various sources of funding for the events and activities demanded by our citizens. Corporate sponsorship and partnerships for programs and events will be a key source of funding. We respectfully request that the city work with us to provide adequate human resources to administer these programs year round 7 days a week. With the increased activity to the Park will come increased traffic and parking issues. Parking around the Pavilion and Interpretation Center was already at a premium before Phase I was completed. With a more user friendly park, we have eliminated several parking sites and are left with very little parking It is vital that we immediately commence Phase II of the Rockwood Park Redevelopment Plan in order to provide adequate parking and facilities to accommodate the demand. 58 Keep your eyes on Rockwood Park because we have an excited team, we have the will of the people, and we have one of the finest recreational facilities in Canada and we intend to use it! But we can't do that without a leader. Helen will introduce us to our honorary leader... Helen: Here's our cute little leader, but she lacks a name, so we're hosting a contest to name this little leaper so she can open all the important events hosted here at Rockwood Park. We've teamed up with each and every stakeholder in the Park and have developed a contest to name the Rockwood Park mascot. Look for our prize package and contest announcement in the Telegraph Journal. Robert Capson Part 3 Thank you Cathy and Helen! I'm sure you will agree that the future looks bright for Rockwood Park. Our directors are excited about the benefits Rockwood Park has to offer. For decades this Park, the second largest in Canada, has been considered a priceless asset to our city. After many years of neglect we have the potential to make it a destination for all. By this time you are probably asking yourselves what do the directors of Lily Lake Pavilion Inc. want. Our requests can be categorized into three issues, (1) Re- development Project, (2) Increased Leisure Services and (3) increased security. Rockwood Park Re- development Project As I just mentioned earlier, when you came in the Park today you witnessed the final stages of Phase 1 of the re- development project. We are absolutely thrilled at the transformation of the entrance to the Pavilion. While we have experienced significant disruptions due to constriction we have been able to continue to operate and provide community programs. However we continue to experience significant parking and traffic issues. (Slide of traffic at last year's pond hockey) These problems can only be addressed if we are able to complete the second phase of the project. 59 The re- development project consists of 5 phases that have a combined total capital cost of $10.2M. Let me illustrate the different phases. (slides of the 5 phases). Our objective is to have Phase 2 completed this year. This phase will provide the Park with a new entrance and parking for the citizens attending the various community programs planned this year. As you can see Phase 2 has a projected cost of $3.4M. During a recent meeting with the Mayor and the previous City Manager it was identified that the City had committed $IM in the 2010 capital budget. In addition there was $1.2M allocated from Emera to the Saint John Horticultural Association for future trail development in the Park. It is our understanding that the Horticultural Association are willing to release these fiends to be included with the City's portion resulting in $2.2M for this phase. We are therefore short $1.2M for the completion of this phase. We were surprised that the re- development project was not included in capital funding requests made by the City the provincial and federal governments. Representative of our Board have met with Hon. Stuart Jamison, NB Minister of Tourism and Hon. Rodney Weston, MP for Saint John requesting that their respective governments commit $600K to match the fiends available in order to complete Phase 2. While we received enthusiasm from these representatives to date we have not been advised of the funding. We are well aware of the tremendous pressures Council is experiencing from many sources for funding; harbor clean -up, water improvements, better roads. This Council has made recreation a priority of the City and what better way to deliver these services than continued improvements to Rockwood Park. We request that Council make the completion of Phase 2 a high priority and instruct staff to find the funding necessary to complete the next phase. Our second request is: Increased program services from Leisure Services Department There is no doubt that Rockwood Park has taken on a new life. While the community has always recognized the value of the Park, in the past decade there has been little activity to make the Park the destination area for our citizens. As you saw from Cathy and Helen's presentation we have just scratched the surface of the many programs we can offer to the community. With the Pond Hockey Tournament last year we experienced significant issues in our attempt to ensure the event would be successful. Not the least of which was snow removal, ice maintenance and traffic control. There is no doubt that the staff of Leisure Services and Operations stepped up to the plate. at the last minute and provided the many services required. We certainly could not have held the event without their support. We thank them for their support! However as we go forward and plan many programs and activities in the Park we need assurances that the staff will be able to provide the many services that will be required. The mandate of the Lily Lake Board is to operate the Pavilion and provide the facility for community events. While we could simply concern ourselves with activities within the confines of the building; we do want to promote the Park and provide programs and events for the citizens. As an example, due to budget cuts and the lack of activities in the Park during the winter months there have been no support staff in the Park. There were no fiends in the operating budgets for ice maintenance, trail grooming and general park maintenance. If .f we are to expand the programs and activities in the Park we need assurances that the funds will be budgeted to meet the operational demands. Our staff and directors are very willing to work with city management to identify the various programs and community events and establish budgets to ensure the success of these events. These events can only work if we cooperate. Our ask of Council is to direct senior staff to work with our staff to identify the programs and the associated costs and to ensure there are sufficient staff in the Park to maintain the grounds and co- operate the programs. Out third and final request: Increased Park Security One of our biggest hurtles is the public perception that the Park is not a safe place to walls, run or bike. As you are aware there have been several incidents in the Park that have created that impression, sexual misconduct, after hour drinking, vandalism and a murder two years ago. Two weeks ago we had an attempted break and enter in the Pavilion. We were fortunate that the culprits did not gain access to all areas of the building and nothing was stolen. However there was considerable damage to our patio doors. As some people realize that we have a considerable investment in the facilty and equipment we will may experience more of this activity. Recently one of our directors in a conversation with a police officer mentioned that she liked to walls in the Park. She was informed that was a dangerous activity and she should not walls alone. While the officer was attempting to apprise her of the dangers it does little to quell the perceptions of the Park. We need to do whatever it takes to make the Park safe for all our citizens. A number of years ago the Park was patrolled by a police officer on horseback. This not only did this proved to be a deterrent to the criminal element but also provided the police with great public relations opportunity. While it may not be economical given today's budget restraints to have a horse patrol surely we could have police on bicycles or the three wheeled scooters seen around town. Regardless how it is accomplished we need to increase the presence of the police in the Park to reduce the opportunity for break and entry, vandalism and sexual activities. We need to give the Park back to the people and make it save for them. We request that Council direct the Police Chief to work with our staff and the staff of Leisure Services to produce a plan to increase the presence of the police department in the Park. Mr. Mayor and councilors this concludes our presentation this evening. Please take the appropriate action to commit to our three requests. This is your opportunity to show the citizens that you support recreational activities and are committed to make Rockwood Park an outstanding success. As you leave I encourage you to view the photos around the Wallace MacMurray Room to see the history of Rockwood Park and the many activities that took place here over the past century. I also suggest you visit the Labour Museum. We thank you for holding your meeting in the Pavilion, and we thank you for allowing us to make this presentation. Should any of the councilors have any questions our staff, directors or I would be willing to answer them. AN 62 ATHEWAY PAVILION AT LILY LAKE Summer 2009 The Hatheway Pavilion at Lily Lake is more than just a building. It is an outstanding example of what a community can do when it comes together with a common purpose. An iconic landmark on the shore of lily Lake since the turn of the 201' century, the first Pavilion was erected across the lake from where it currently stands. It was adorned with a bell- shaped cupola, dormer windows and gingerbread trimmings. When an unfortunate electrical fire claimed the Pavilion in the 1950s, a new building was constructed on the present site and stood unchanged until 2000. It was then that the Saint John Horticultural Association, who for the past 40 years had operated Rockwood Park, began spearheading an extensive restoration project for the site. The Association formed a committee and entered into a partnership with the Hatheway "Trust for the revitalization and long -term operation of the Pavilion. Under the dedicated leadership of the late Wallace MacMurray, and through contributions from several individuals and organizations such as Canaport LNG, a complete redesign and renovation of this landmark was completed. This was truly a turning point in the Pavilions story. ell Now, the new Pavilion stands completed and alive. Many dedicated volunteers have helped restore the building to its former grandeur. But, there's more. Curs is a building with a purpose. Lily Lake Pavilion Inc. is a registered charity, operated by a volunteer Board of Directors. With terrific support from the City of Saint John, the Pavilion offers and facilitates outstanding recreational experiences for the people of Saint John and surrounding areas, with a particular commitment to our youngest citizens. Through fundraising efforts and our business operations, the Pavilion generates funds to provide memorable recreational experiences for those who need it most. If members of our community are unable to realize these opportunities for themselves, for financial or other reasons, we endeavour to bring these opportunities to them. 2009 Board of Directors The 2008 Pavilion Cup We are so fortunate to have Rockwood Park as our home - Canada's largest urban park and a true Saint John treasure. This means we have the best recreational and leisure opportunities available, right on our doorstep. Many community events have been hosted at the Pavilion since it re-opened in November 2006. We work closely with many local charities to facilitate their recreational events year round. The addition of a new deck and performance stage will enable us to provide even more family and community events at Lily Lake. As a direct result of the tournament, 300 Saint John children will experience a week-long day camp at the Pavilion this July and August. This could not have been possible without our many community sponsors and volunteers. Thank you all. — n — The Board of Directors of Lily Lake feel strongly that we are accountable to the people of Saint John. We live here too. The following is a summary of how funds raised were allocated during our financial year, ending April 30, 2009. Lily Lake Pavilion Inc. Balance Sheet Unaudited As at April 30, 2009 ASSETS 2009 2008 Current: Cash $ 95,134 70,196 Investments 9,450 9,450 Accounts receivable 26,011 30,344 Inventory - at the lower of the cost and net realizable value 17,189 6,668 Prepaid expenses 5,631 1,669 153,415 118,327 Capital: 2,087,692 1,894,787 $2,241,107 $2,013,114 LIABILITIES AND NET ASSETS 2009 2008 Current liabilities: Accounts payable 37,483 15,561 Unearned revenue 54,607 57,925 92,090 73,486 Net assets: Unrestricted 61,325 44,841 Building Fund 2,087,692 1,894,787 2,149,017 1,939,628 $2,241,107 $2,013,114 Board of Directors Hatheway Pavilion at Lily Lake Heather Acker Robert Capson, Chair Councillor Bill Farren David Hayward Jim McAllister, Treasurer Bill Merrifield Jennifer Millbury Gordon Mouland Chris Pyne Donna Redmond Gates Patrick Riley Cathy Taylor, Facility Manager Tom Tracey, President George Vair Carolyn Van der Veen Alanna Waberski, Secretary 66 July 13, 2009 His Worship Mayor Ivan Court And Members of Common Council Your Worship and Councillors: RE: 2008 Audited Financial Statements The 2008 audited financial statements for the following funds will be presented to Common Council on July 27th, 2009: 1. City of Saint John General Fund 2. City of Saint John Water and Sewerage Utility 3. City of Saint John Reserve and Trust Funds Ernst & Young have audited these financial statements and their Auditor's Report is attached to each set of statements. Any questions related to the audit should be directed to the representatives of Ernst & Young who will be in attendance. As in previous years, it is suggested that questions relating to the operating results or financial position of the General Fund, the Utility or the Reserve and Trust Funds be directed to the Commissioner of Finance, Mr. Yeomans. This procedure will recognize management's responsibility for the finances of the City and the preparation of the financial statements. Your Finance Committee reviewed the financial statements with Finance Department staff and Ernst & Young representatives on June 29th, 2009. Upon completion of the presentation of these statements I will move the following motion: That the audited financial statements of the City of Saint John General Fund, Water and Sewerage Utility and the Reserve and Trust Funds for the year ended December 31, 2008 be approved as presented. Respectfully submitted, Deputy Mayor Stephen Chase Chair Finance Committee �II AI N ' pt i4 IN P.O. Box 1971 Saint John, NIB Canada E21-40 1 wwwsainqohn.ca � C.P. 1971 Saint John, N.-B. Canada E2L 41.1 67 2008 OPERATING HIGHLIGHTS THE CITY OF SAINT JOHN GENERAL FUND AND THE CITY OF SAINT JOHN WATER AND SEWERAGE UTILITY OVERVIEW The General Fund realized a surplus for the year ended December 31, 2008 of $382,488 based on total revenues of $118,744,414 and total expenditures of $118,361,926. Revenues Expenditures Surplus Budget $116,644,755 $116,644,755 $ 0 Actual $118,744,414 $118,361,926 $ 382,488 Variance $ 2,099,659 $ (1,717,171) $ 382,488 The Water and Sewerage Utility incurred a deficit for the year ended December 31, 2008 of $117,833 on revenues of $28,714,858 and excess revenue from previous years of $113,659 versus expenditures of $28,946,350. Revenues Expenditures Excess revenue previous years Surplus Budget $ 29,733,124 $ 29,846,783 $ (113,659) $ 0 Actual $ 28,714,858 $ 28, 946, 350 $ (113,659) $ (117,833) .. Variance $ (1,018,266) $ 900,433 $ 0 $ (117,833) 2008 Operating Highlights GENERALFUND Revenue Analysis The primary items that contributed to the positive revenue variance of $2,099,659 for the year ended December 31, 2008 include the following: - Building permit revenue of $1,707,849 (2007 - $1,424,175) versus a budget of $1,000,000 for a positive variance of $ 707,849; - Short-term interest revenue of $667,129 (2007 - $853,363) versus a budget of $250,000 for a positive variance of $417,129; - Miscellaneous revenue of $1,496,827 (2007 - $9,145,474) versus a budget of $788,839 for a positive variance of $707,988. The total positive variance for these three revenue areas is $1,832,966 or 87.3% of the total revenue variance. While this analysis explains the revenue items that contributed to the surplus it is important to not lose sight of the fact that the major sources of revenue for the General Fund are property taxes and the Unconditional Grant. Property tax revenue in 2008 was $90,624,562 (2007 - $84,246,996) or 76.3% of total revenues collected. The unconditional grant received in 2008 was $19,499,823 (2007 - $19,117,473) which represented 16.4% of total revenue. The combined total of Property Taxes and Unconditional Grant for 2008 was $110,124,385 (2007 - $103,364,469) or 92.7% of total revenues collected by the General Fund. Expenditure Analysis In terms of the expenditure analysis there were both positive and negative variances in virtually all budgets that impacted the 2008 General Fund operating results. As outlined above expenditures for the General Fund were $1,717,171 more than budgeted. The following areas were over spent in comparison to budget resulting in negative variances for 2008: Saint John Police Commission expenditures of $21,214,898 (2007 - $18,975,273) versus a budget of $20,063,849 a negative variance of $1,151,049. A portion of this variance $219,000 would be offset by recoveries for funds received and credited to miscellaneous revenue; 2 .• 2008 Operating Highlights Expenditure Analysis (continued) - Saint John Transit Commission 2008 funding of $4,129,712 (2007 - $3,436,818) versus a budget of $3,519,925 a negative variance of $692,894; - Transportation Services 2008 expenditures of $19,515,503 (2007 - $16,936,629) versus a budget of $18,571,555 a negative variance of $944,148; - Environmental Health Services (solid waste collection) expenditures of $4,020,851 (2007 — $3,151,196) versus a budget of $3,624,979 a negative variance of $395,872; - Fiscal charges with expenditures of $16,573,226 (2007 — $17,673,536) versus a budget of $16,284,270 a negative variance of $288,956. The following expenditure areas were under spent in comparison to budget resulting in positive variances for 2008: - Public Safety Communication Centre with expenditures of $1,666,060 (2007 - $1,891,394) versus a budget of $2,062,840 a positive variance of $396,780; - Information Systems and Support had expenditures of $1,628,199 (2007 — $1,815,109) versus a budget of $2,018,794 a positive variance of $390,595; - Market Square Common Area costs in the amount of $1,769,228 (2007 - $1,787,105) versus a budget of $2,078,407 a positive variance of $309,179; - Fire Department with expenditures of $19,254,186 (2007 - $17,997,331) versus a budget of $19,440,419 a positive variance of $186,233; - The Tourism Department had expenditures of $894,626 (2007 - $911,478) versus a budget of $1,035,218 a positive variance of $140,592; - General Administrative expenditures totaled $ #2,501,823 (2007 - $2,425,525) versus a budget of $2,608,137 a positive variance of $106,314. s 2008 Operating Highlights There are other key points that should be discussed in terms of these Financial Statements. The first one is the amount of debenture debt outstanding at the end of 2008. The total was $58,726,600 (2007 - $52,390,700) which represents an increase of $6,335,900 compared to 2007. Debentures were issued in 2008 in the amount of $14,000,000 (2007 - $5,700,000). Principal repayments on debentures in 2008 were $7,737,670 (2007 - $8,177,628). The driver of the debenture borrowings is funding for the capital program. In 2008 the City of Saint John General Fund invested $27,107,570 in capital assets (2007 - $21,773,499). Another key item is the Pension Plan and the status of its funding. The last actuarial valuation was completed at December 31, 2006 and resulted in an unfunded liability on a going concern basis of $31,014,900. The 2006 valuation has been updated by extrapolation for year -end 2008 and the results indicate an unfunded liability on a going concern basis of $150,573,229. The details of this extrapolation are included in the Notes to Financial Statements, note 4.13. Pension Plan Actuarial Information page 13 in the General Fund draft Financial Statements. WATER & SEWERAGE UTILITY As stated in the overview at the beginning of this report the Water & Sewerage Utility had a deficit for the year ended December 31, 2008 of $117,833 (2007 - $407,346). Total revenue generated from utility customers in 2008 was $25,943,716 (2007 $26,269,058) versus a budget of $26,865,001 a negative variance of $921,285. Two other sources of revenue come from charges to the General Fund for Water Supply for Fire Protection and a charge for Storm Sewer. These charges are based on costs incurred by the Utility and have been determined using calculations provided in the Business Plan review completed in 2002. The revenue for the Water Supply for Fire Protection in 2008 was $1,853,126 (2007 - $1,909,618) versus a budget of $1,882,000 a negative variance of $28,874. The Storm Sewer revenue was $918,016 (2007 - $962,024) versus a budget of $986,123 a negative variance of $68,107. 4 FA 2008 Operating Highlights The shortfall in revenues was offset for the most part by savings in total expenses and fiscal services of $900,433. The operating expenses for 2008 were $17,415,447 (2007 - $16,787,368) versus a budget of $17,311,931 a negative variance of $103,516. Fiscal charges in 2008 were $11,530,903 (2007 - $12,823,023) versus a budget of $12,534,853 a positive variance of $1,003,950 a result of the Utility issuing less debenture debt than anticipated. As with the General Fund the other key points that should be discussed in terms of these Financial Statements are debenture debt and investment in capital assets. The debenture debt outstanding at the end of 2008 was $45,504,000 (2007 - $45,307,000) which represents an increase of $197,000 compared to 2007. Debentures were issued in 2008 in the amount of $6,000,000 (2007 - $7,000,000). Principal repayments on debentures in 2008 were $5,803,000 (2007 - $5,962,000). The driver of the debenture borrowings for the Utility is the same as for the General Fund, funding for the capital program. In 2008 the Saint John Water invested $10,148,961 in capital assets (2007 - $12,915,284). CONCLUSION For the year ended December 31, 2008 The City of Saint John General Fund realized a surplus of $382,488 and Saint John Water experienced a deficit of $117,833. Staff, working with Common Council, will continue to monitor our operating results with a view to controlling costs as well as looking for new ways to generate revenues as we strive to provide citizens and ratepayers with the services they require at the best possible value. F 72 FINANCIAL STATEMENTS „%;;;, 73 CONTENTS Auditors' Report Operating Fund Balance Sheet Operating Fund Statement of Revenue and Operating Fund Statement of Equity Capital and Loan Fund Balance Sheet Capital and Loan Fund Statement of Eqa Statement of Source and Application of Notes to Financial Statements Operating Fund Schedule of Operating Fund 74 Pgge 1 2 3 4 5 6 7 8 -17 18 -19 20 -25 AUDITORS' REPORT To His Worship The Mayor and Members of Common Council of The City of Saint John We have audited the balance sheets of the ( The City of Saint John General Fund statements of revenue and expenses, eq financing for the year then ended. The�c comply with Section 8 of the Control o�1v� financial statements are the responsibili, is to express an opinion on these financial "s� We conducted our audit in accordance standards. Those standards require that reasonable assurance whether the financial An audit includes examining, on a,tV.1 disclosures in the financial statemeni �r ari principles used and significant estunates mt overall financial statement nresdhtat on. In our opinion, these financials financial position of The.,-City df5. and the results of its operatdns and the year then ended in ccordance these financial statements.,", atmg" d e apital and Loan Fund of 1..,. p at !!r 2008 and the related . and' application of capital racial a been prepared to ipali fife runswxcic. These �Ctty snag f;.; �ptsibility ents`iased on our ily accepted auditing i an audit to obtain naterial misstatement. P g the amounts and sing the accounting well as evaluating the ul;' hr all material respects, the Yumd as at December 31, 2008 ilicatk)n of its capital financing for accounting described in note 1 to These financial statements, which have not been, and were not intended to be, prepared m accordance with CanAdian generally accepted accounting principles, are solely for the tnformAora,and use of His Warship The Mayor and Members of Common Council of `The :City of,Siin John, and the nister of Local Government of the Province of New Brunswick;�-and arm not mtend&d b5 ba and should not be used for any other purpose. They have been p�r�pafed to, and" do, comply with Section 8 of the Control of Municipalities Act" df1u.Brunswick. Chartered Accountants 75 The City of Saint John General Fund OPERATING FUND BALANCE SHEET As at December 31 2008 2007 PaeY ASSETS 'Vi % i j UPIi/ Cash and short term deposits Accounts receivable p 9,824570 16,077122 Due from associated entities fy /1� /J a , Water and Sewerage a ad�`�,,,'ti ,2 876�� „� 8 a A ital and Loan � 1s,� I483,348 i Water and Sewerage Utility Operating .lttJ; �% Nl, 3,79(r;7o„ , ' - 5 General Capital and Loan Fund ��%� �1' p i,�y � �� 91 �'�' 8,362,829 "' 1 610 254 r r , City of Saint John - Pension Fund '' , 11 '� U�� Saint John Non Profit Housing Inc. �d �, 350 600 Inventory of materials and supplies, a, 1,41RIN �rt�ia lower of cost and replacement co � � p x' / %/ X7,177 841,780 ] 4 Deferred expense - Pension (nor � o ,,�� „7- �iy$ "41,587 6,455,450 Prepaid expenses �; jI '��,, � 851,190 439,908 LIABILITIES AND 14 Accounts payable and 10 Other payables [not '0 Interest payable on Due to associated, Saint John P -' t Power Comob c Harbour Station ;Hh "T'he Citv of Saint J3h Computer replacement i Fleet replacement fund 11 Lon -term debt notc�3 h A t ''n,' 4, - Equity f„ See accompril Approved by Mayor debt City of Saint John Fund Fee 13,264,924 10,3 88,856 7,197,336 6,636,450 555,601 640,819 4,281,518 4,050,614 12,259 12,259 22,021 22,021 - 146,650 316,460 356,818 - 9,568,929 650,962 746,483 733,164 869,544 1,022,485 198,410 6,720,000 8,400,000 34,776,730 42,037,853 313,193 988,603 35,089,923 43,026,456 Chair of Finance Committee 2 The City of Saint John General Fund OPERATING FUND STATEMENT OF REVENUE AND EXPENSES As at December 31 Budget Actual 2008 2008 Unaudited IU ,, !, Penn Actual 2007 REVENUE Property taxes ju�90,624,562 ? 90,624,562 84 246,996 Unconditional grant i o t Province of New Brunswick 19,499;823 19, ,9,117,473 18 Sale of goods and services 1-044;50 yF 1,101, 989,038 19 Other revenue from own sources �4,47,331 5,735,950 5,725,015 19 Conditional grants from other governments 25D,000 y - 285,635 315,404 Miscellaneous revenue .� ��_ : 88 839 1), 4if 827 1,145,474 Total revenues 1^144,414 111,539,440 EXPENSES 20 General government services �" ,� -, 10,592,508 10,068,656 21 Protective services ! , �' °' t ��% f� 45,799,875 42,210,533 22 Transportation services 25,128,391 22,002,121 Environmental heal ices °' l "�� 3,624, 4,020,851 3,151,196 23 Environmental dev services , `h'�*,9 8 9,327 936 9,095,870 f: 24 Recreational and c services 7,977,037 7,340,845 !' ?. 25 Fiscal services ` 0 16,573,226 17 673,536 If, k > 4 Excess of (reVfnijiW nses second previou�yti�,'.,� (1,057,898) (1,057,898) 65,935 : '.- Total expensel ".1is AlU rviees 116,644,755 118361,926 111.608.692 77 K The City of Saint John General Fund OPERATING FUND STATEMENT OF EQUITY Year ended December 31 2607 Equity, beginning of year 988 603 991,960 Add: V , 3 Excess of revenues over expenses �f ( expenses over revenues) for the Year � MAU. v� + +.. ,, (69.292) Add: 3 Excess of (revenues over expenses) 935 2 Equity, end of year 313.193 988.603 r'! The City of Saint John General Fund CAPITAL AND LOAN FUND BALANCE SHEET As at December 31 2007 S ASSETSZ� Due from associated entities i� Water and Sewerage Operating Fund 17,326 Saint John Parking Commission Saint John Transit Commission n,,1 119;93 "U 17,326 Investments in shares of wholly owned company," ' V1 Saint John Industrial Parks Ltd., at cost �' r;' �9� 994 994 12 Land, buildings, plant and equipment engineering structures fnote 3 3;916 418,226 346 %Y '145;454,833 418,244,666 LIABILITIES AND EQUP, I 1 Debenture debt [note 3] 11 Other long -term debt (note 3 Saint John Parking b olkmis Deferred contribut Due to associated s 2 GeneralOperv&A Water and S&' -! ity Capital "W 58,726,600 52,390,700 220,710 294,280 2,052,206 276,457 8,362,829 1,610,254 - 1,253,713 - 2.894.194 69,362,345 58,719,598 41 Chair of Finance Committee 5 The City of Saint John General Fund CAPITAL AND LOAN FUND STATEMENT OF EQUITY As at December 31 Equi beginning of year Debt repaid by the General Operating Debenture debt Canada Mortgage and Housing Corp Saint John Parkine Commission Proceeds of land sales in em Capital projects financed by Operating Fund Fixed assets purcas _th General rating 5 Equity. end See accompanyiw n6 W i "P, .:1 382,499 87,123 ,132,113 500,241 2,717,589 2,841,918 0 The City of Saint John General Fund STATEMENT OF SOURCE AND APPLICATION OF CAPITAL FINANCING Actual Actual 2008 2007 Source Bond Issue 00 5,700,000 Contributions in aid of construction Federal Government 98,151 Provincial Government 973,985 "I"' A, Other 0# 3,595,79G 401,850 Fixed assets purchased by the General Operating F6`A4A,,, '3 2 717,589 2,841,918 Capital projects financed by the General Operating find 1w, 1,132,113 500,241 Proceeds on land sales in excess of estimated =m lip r 2,499 87,123 Debt repaid by the General Operating Fu Fu 7,670 YIN 8,177,628 I Increase in amount due to the General 2,575 4,809,523 Increase in amount due to Water an of, 1, u^o Utility Capital and Loan Fund 1 184 355 ,, Deferred contributions 1,775,749 276,457 EA 43,348,579 35,251,231 Application Z1� P Ap", Capital expenditures 21,773,499 Debt repayment 7,737,670 8.177,628 Increase in amounts u 6ciated entities 102,597 972,720 Decrease an= g/maunt due v werage 14Loan 1,253,713 , ` 66cr&ase 1 IV W0 0 associat 2,894,194 - tontribut ion !JA Transit Co !AJssjon 4,252,535 4,3273 84 43348.579 35.251.231 Z r1 The City of Saint John General Fund NOTES TO FINANCIAL STATEMENTS December 31, 2008 1. ACCOUNTING POLICIES These financial statements have been accounting principles prescribed for of Local Government. Financial statement presentation The General Fund financial prepared in accordance with the City's working capital reflects its investment in.fixe Fixed assets and to the Saint John (the "City ") have been ing The Operating Fund reflects ,# -the Capital and Loan Fund = -term debt. ro�ded at cost. Funds received through capital assistance Ff f� 0�1 a "I'll, 1 loan forgiveness are treated as additions to , except �vlere the asset was acquired under the Urban Renewal the funds received are netted against the asset cost. lepreciation on its fixed assets, but an amount equal to annual to operations and credited to equity in capital assets. The City The City follows the accrual method of accounting for revenue and expenses. 8 82 The City of Saint John General Fund NOTES TO FINANCIAL STATEMENTS December 31, 2008 1. ACCOUNTING POLICIES (continued) Accounting for second previous year's Section 89 of the Municipalities Act revenue over expenses for a fiscal year be i and that similarly, the excess of expenses expenses in the second ensuing year. .Accounting estimates principles requires reported amounts of 'econaresistang year year be included in r ith generally accepted accounting and assumptions that affect the of the financial statements and the expenses during the reporting periods. Actual results City's financial instruments other than Iong -term debt of their short -term maturity and normal credit terms. do not represent significant concentration of credit risk are owed by a large number of ratepayers on nom 83 9 The City of saint John General Fund December 31, 2008 Heart and lung liability Vacation pay Retirement allowance fy 2008 2007 ` s s '0 000 1,950 2 14,500 The City pays certain amounts to disabled spouses as a result of the eye ��far provisions of an Act of the Le shillur r rtt as the Act. An actuarial �' /�rw /aiD w. w� �o r'. =• review of this plan was coniple r �� er 31, 20 a estimated actuarial + r� , ° P. � �i n?i JAY A present value of benefits at I c� r 3I, r "�� 9,00 , This review only covers current claimants and does 1 de I e f The City has Employees uponrrdtomerlt rrf�, ✓hu allowance equal to 2Sne'mo% from the City of iiint John are entitled to a retirement pay ti's Tray, to a maximum of six months, for every five years of eenraended to provide certain employees with a payout tpept�ng the early payout option eliminates further lowarihe entitlement for those employees. after June 1, 1998; and Management employees hired after gible for retirement allowance, now or in the future. These the Local 18 collective bargaining agreement and the and conditions of employment. 84 10 The City of Saint John General Fund NOTES TO FINANCIAL STATEMENTS December 31, 2008 3. DEBENTURE AND OTHER LONG -TERM DEBT Debentures consist of the following: i� ;i� err Term 2008 2007 rate', %/ Year of Interest iy Texm , � „ ��/'3Qi18 2007 ,/ Issue Rate �3Cears ,„ ,B�laki f{ Balance / N ti yr,fl 1l I 1998 5.2500 to 5.6250 4" �� f lU� " F ' 10„ " - ii '729,500 1999 5.2000 to 5.7500 ,' 2_1 'fig 862,�QO!/ 41' V1,11,131,11 1,731,200 2000 6.1Q00 to 6.4000 1,328,000 10 ��'�rt 1,992,000 2001 2.4500 to 5.50000 f 1,515,000 2,020,000 2002 3.3750 to 5.7500 m I O ''��ai �'''3 2$4 000 3,980,000 2003 3.0500 to ' 5,670,000 6,604,000 2003 2.7500 to 5125p 2y970,000 3,564,000 2004 2.7500 t(�4'8fb Ali , "� r 8,662,000 9,449,000 2005 ,O 3.7500 4.3750 to �� f f if%,"A s y , , / 5,681,000 6 154 000 , 2006 4.1500t6AA500 I0 ��, %, � 9,534,000 10,267,000 2007 4 500 to4.8500 �' �, �y % „'' 10 �� 5,320,000 5,700,000 2008 3 306 4.8500 At r � r "��k � 1Q '� f `;� 8,500,000 - y�to @ % 2008 2,100 to 5.5500 < %,,ISf -," 5 00 000 - Debenture Debt ��„ �l F Z. 11 '`' %i, / %; "` 58,726,600 52,390,700 0 Other long -term debt 6601 sis G# thqfoIlowing: �' / Y ui , ,; Interest' Term 2008 2007 rate', %/ Years Balance Balance k 2007 ' t , ,� °" 4.36 5 6,720,000 8,400,000 ,;,Province of New Brunswick: 2.75 7 220,710 294,280 -Salat'Iahu Parkini6ifimission Other long4e rm'debt 6,940,710 8,694,280 11 85 The City of Saint John General Fund NOTES TO FINANCIAL STATEMENTS December 31, 2008 3. DEBENTURE AND OTHER LONG -TERM DEBT (continued) The aggregate amount of principal payments re uuid -O' teat g ;,the next five years is as follows: t, '� k 2009 r �� -. 9C7A117o 2010ri,Mr4 ;, , ' 8,753`,5 �U 2011 �J e,�p � 8,089,5 b 2012 0 • ��t, 7,511,000 f 2013 `?,Q35,000 Fixed assets include $17,769,941 (2 �9 )7 d 70) for�hkh; Wancing has not been arranged at year end, 4. PENSION PLAN 1� r A. OVERVIEW -p, The City provides � � d irmt °� p ee i accordance with the provisions of tm the revised City of mri�t dhn 1 e�sr� �;d t Acted on May 12, 1994 and last amended onufir�l,2 �O1 The 1s k�ristered by a Board of Trustees, representing �Co � f y�.�; uinie�l.l, rrwana erne ; unionized employees and retired employees. irilt Cr the plan was governed by The City of Saint John Pension Act, 1970. ,` abject to the provisions of the New Brunswick Pension B! ppoz�sActwhich be ,jainuary 1, 1992. The'plan, is`'a defined benefit " irchu provides for pensions based on length of service and ra taf.pay „Both Navy 1mic�ipality and the employees make contributions to the plan. T ity ;s. contribution limits are fixed by legislation at a minimum amount of 70% of en`�loyee earnings. The City is currently contributing at a rate of 11.6% of salary. EfeCtive May 1, 2007 the employee contribution rate was changed from 8.5% to 10.5% "of pensionable earnings. The additional 2% employee contributions will 1?e,rnade until the sooner of May 1, 2010 or to the date when the going cbncem uniiytided liability has been eliminated. The City charges all of its contributi ons to expense in the year the contribution is made. The amount contributed for enl5la±es, o#hex' than those funded by the Water and Sewerage Utility, for 2008 was $7;958,994 (2007 - $7,714,410). 12 .6 The City of Saint John General Fund NOTES TO FINANCIAL STATEMENTS December 31, 2008 4. PENSION PLAN (continued) B. ACTUARIAL INFORMATION The 2006 actuarial valuation indicated thg e5, nt val e o ;', i& tmulated plan bene% was $ 396, 778,000 and the adjusted m4k6t1*alue of(iiet AWtsyAy ilable to provide ' a= 6 benefits was $365,763,100 with an esttmat4 d unfundrdiliabWt�rjq $3X,014,90 ~ on a going concern basis. As of December 31,20t}6x the�'lxabtlities ona solenaylbasis were greater assets Y eater than the solvent b The 2006 valuation has been updated by extx60614ti6n to`, Dee ember 31, 2008 and the results indicate that the accumulated plan bents nom+ exceed t}e adjusted market value of assets available to provide benefits resulting in a dq� 150,573,229 on a going concern basis. This valuation relates to the enti �` 610d %s employees` funded through both the General Fund and the Wate °� '� ewer current costs and special funding 4A,f payments are allocated to each ` n the oreentage of payroll. gym , o„ " VIlf r`'% �'d' 7' €r f IJ %,d C. DUE TO THE P4ON PL � 9i The New Brunswick n Benefrs A u es, at a solvency deficiency be funded over a period of e, nless an exemgri4 requested to fund over a period of no more than 15 yeaq,"ox rind to December 31, 2018, whichever is shorter, or an exemption from mak1to ,.!%y. payments is granted. 1n 2007, the,exez ption fro" r 491vency special payments to the pension plan was sought and�rcervd,` ;As a restiJF wing this exemption there is no longer solvency �ii ding due frorrt tie City as at Dpi *ber 31, 2007. u r During 2008, the`Ctty paid the plan $2:623,662, which represented required special funding and interest`omigoing concern basis (2007 - $4,358,454). The General Fund's share of this for 2Q0$ is $2,311,446. The City is required to make special going concern payments unti12018: y IN 87 The City of Saint John General Fund NOTES TO FINANCIAL STATEMENTS December 31, 2008 C. DUE TO THE PENSION PLAN ( During 2006 the City of Saint John paid thb, lan $4 1331`10,0 which represented required special funding and interest on a going conceCtt baste for the years 2004 to 2006. The General Fund's share of ' kklts anngWxt has` $I't?�7'9 262 of!�which $1,200,000 was expensed in 2005,1,P`9s expensedt iii a�20 D6, ; and $1,613,863 was expensed in 2007 and 2008,'leavng an unamoiei balance of $4,841,587. The City received approval t ;,atni?rt�ze this expense "over :4 period ending in 2011. 5. CONMUTMENTS Saint John Transit During 1979, the Saint John Tr visit Comnitssi6n,was, created by an Act of the Legislative Assembly of Ne�`ti `o �runsWiG1K'� Uitde "provisions of the Act, the Commission has the authority to,mamtatu aiid operate :.public transit system within _ the City of Saint John, all operating losses an t charges being funded by the City. The City is also1for the detrtures }ssved on behalf of the Commission which at December 1008 amounted `to;$4,43(1000 (2007 - $3,442,300), The Greater Sa3gt *t1 +gnomic Development Commission, Inc. Durthg i9 the Great du Economic Development Commission, Inc. was mcororated `rticles lion provide a funding formula for costs to be shared by.e p �rCtRsting mil Mies. The participating municipalities are the Town of Qua �ihe Town Wo hesay, the Town of Grand Bay - Westfield, and the City of Sain J�q. "„ oy� Greater Saint Johni<Rianal Facilities Commission During 1998, the 'Saint John Regional Facilities Commission was created by att` Act of the te Assembly of New Brunswick. Under the provisions of the A` C txtna s 16ii.has the authority to determine the annual amount of the total munictp . "r�jibri�ru[tton to be made towards the operation of five regional facilities: the Canaca'9Gs Aquatic Centre, Harbour Station, the Saint John Trade and Convention'' ter, the Imperial Theatre and the Saint John Arts Centre. Under the provisions of the Act, the City's contribution is its prorata share of the Commission's operating budget based on the tax bases of the participating municipalities. The participating municipalities are the Town of Quispamsis, the Town of Rothesay, the Town of Grand Bay - Westfield, and the City of Saint John. 14 :: The City of Saint John General Fund NOTES TO FINANCIAL STATEMENTS December 31, 2008 5. COMMITMENTS (continued) Market Square Central Building Complex - Lease The Central Building Complex of the Market Sq are Prajeci was''�pened to the public in May, 1983. This complex includes the itbrih" trader 4 „�bnventjon center, parking garage and retail and commercial space. 'Und& the isnnirof hr`e , ty six year leases, the City is responsible for the proportioriater share of�the coirtplex'sr common: 'area operating expenses, including property tax6s,rr6I" to`fi e library, tr2 e'and convention centre and parking garage. Collective agreements 0 There are provisions within a numbe etive agreettteztts beiwcen the City and bargaining units representing its em VIM, t expenditure of funds. The Agreement with C sting the Csity's outside workers, commits the City to employ a "m o %y ees at an approximate annual expenditure of $13,600,000. agree # on- December 31, 2010. The Agreement with CUPE Local 4 " " ese e �' " � g �iszde workers, has a no -lay -off provision related to all empld , hir 4 rior to t 9, 1985 resulting in an approximate annual expo` re $1, IO. greement expired on December 31, 2007 and was subs ;renewed 108 for the years 2008 -2011. In addition, the -6e Agreement rthe Saint John Board of Police Commissioners a t ocal 61, represent ng the City's Police Officers, contains a noday -off provision ) ' an approximate annual expenditure of $10,059,000. This ttt, expired on ,007 and was subsequently renewed on July 29`h, 2008 pctrug n, eu(�rrra�iiy'fund ing ,`,; In June of 2005 flie City approved a grant of $2,000,000 to the University of New 1 Brunswick, Saint John catnpus. This funding to the University's campaign "Forging Our Futures" is paid in cash "r in kind over a period of 10 years commencing in 2006. !! ` 15 We The City of Saint John General Fund NOTES TO FINANCIAL STATEMENTS December 31, 2008 6. CONTINGENCIES The City is liable for the debentures and supporting entities: The Water and Sewe of December 31, 2008 in the amount of 9 In accordance with the Clean Environmenf'tA,c � 1P Ctt of the debentures and other long -term debt issued ort(b Commission. The portion attributable to th6lq Percentage of total population within all pari7�ipitttng p areas. The total of such debt outstanding at December 3I $12,993,000). Based on 2003 populations, the City of the Commission's debt. 7. RESTRICTIONS ON Section 89 of the Muni( municipality's borrowings budget of the municipqhl property in the munict Fund and the General 8. on behalf of its self - debt outstanding as is also liable for a pro -rata share ehalf of the Fu li`d Waste rtiuntctpalities and unincorporated V2008 Waq $11,279,000 (2007 - rs:.lia%le'for approximately 55% ]i R t o�of;New Brunswick restricts a o g p , ss to I t an four percent of the operating snd ss two p °ant of the assessed value of real �r capital wings by the General Operating and Loan Wt these legislative restrictions. lw 1 vTS t "e:r 31, 2008 represent current transactions and are in 64$* ,by the Department of Local Government. 16 The City of Saint John General Fund NOTES TO FINANCIAL STATEMENTS December 31, 2008 9. TRANSACTIONS WITH THE CITY OF SAINT SEWERAGE UTILITY (the "Utility ") �� The General Operating Fund reimbursed $1,909,618) for water supply for Fire prot sewerage charges. The General Operating Fund charged the $1,337,000) for its share of general governme direct service between funds are not reflected ,,R AND 1,853,126 (2007 - )62.024) for storm Fund $11,367,000. (2007 - Charges for the provision of 41 on a monthly tatements previously It The City of Saint John General Fund OPERATING FUND SCHEDULE OF REVENUE ITEMS (I of 2) As at December 31 Sale of Goods and Services Protective services Point Lepreau Training Garbage collection and disposal Recreational and cultural Administrative service Pension Fund Housing Operations �y f Saint John Transit Commissi"oi Actual Actual 2008 2007 40,400 40,000 t,10 27,143 6,618 S,00a °' , x,500 r, o,n.u, 809,247 756,420 138,227 100,000 45,000 44,000 3 1,044,500,,,: 1,101,617 989,038 18 The City of Saint John General Fund OPERATING FUND SCHEDULE OF REVENUE ITEMS (2 of 2) As at December 3 +1 R, de Actual 2007 age ....m Other Revenue from Own Sources Licenses and permits Business and other' °t� 99,315 91,705 �% °f1707 849 1,424 175 Building l ,?, - 'l� ^�' � , , Plumbing C u� 70,000 , ",1 8,484 98,744 Gas pipel.ine J'y�� '�y� , 5011 ��4��6,564 282,740 e /y�rti 1472,212 1,897,364 Fines and parking i P" " 11811w," � a Parkin and traffic v lats 9 1 �/, Parking �,�I f�� y�� ,� 598,137 580,853 Parking meters �� ,,� �� 775,4 793,977 784,875 �:Ytr Market Square P G e 1,022 1,025,928 959,729 2,418,042 2,325,457 Rentals Market tbui� � 45,000 491,830 491,442 Land and � � 193,000 I86,737 157,389 "11 628,000 678,567 648,831 �J�J�Ir` l7 Si ti St Mole A,� 250,000 667,129 853,363 250,000 667,129 853,363 3 ��J f `; 4,437,031 5,735,950 5,725,015 Other Go vernments agencies IgEmhighways 250,000 285,635 315,404 k' r 250,000 285,635 315,404 19 7AN The City of Saint John General Fund OPERATING FUND SCHEDULE OF EXPENSE ITEMS (1 of 6) As at December 31 L47i %�yy /�% ��Actual Actual 2008 2007 �llllltflt411t )� �''/ Page kk Ao General Government Service Legislative Mayor's Office 174,204 ,�! 209,297 Common Council �IU 419,075 418,832 General Administrative 20 The City of Saint John General Fund OPERATING FUND SCHEDULE OF EXPENSE ITEMS (2 of 6) As at December 31 Protective Services Police Protection Fire Protection Salaries and other operating costs 17 Water supply [note 9] Emergency Measures Emergency Measures Emergency Dispatch Other Protection Building 1nspe Animal RescAR 3 Actual Actual r r� zoos zoo? 71,273 54,186 17,997,331 glltg0f`� 126 1,909,618.00 r 229,335 158,484.15 1,666,060 1,801,394 �1 �l rwl 1,445,125 1,237,812 0 137,145 130,621 .828 45.799.875 42.210.533 21 The City of Saint John General Fund OPERATING FUND SCHEDULE OF EXPENSE ITEMS (3 of 6) As at December 31 Transportation Services Common Services Mechanical Administration Engineering Bu Actual 2007 S 978,003 1,771,975 1,810,043 414,810 '' ' ny ;,,.359,516 382,973 W. The City of Saint John General Fund OPERATING FUND SCHEDULE OF EXPENSE ITEMS (4 of 6) As at December 31 Environmental Development Research and Planning Administration and GIS Real Estate Management Market Square Corporation Environment Committee Heritage Development Board 14 Greater SMnt Jolin Economic, Developtneril jpole 5] Saint John lndzntriwfl 1P4rks v y y 4 I G 15 Market Sgtnare Cam mprt A.r W Growth 8lrrrttgy lnWifl" c 15 Regional Facili'tl sCwalsi +'. Tourism acid (2,6m. calions 'Am Budget """J""'" Actual Actual 2008 i% X2008 2007 9, i r na'tlmted IN.,20. 877j'2 "742,952 q2 743,781 ' r `'' 670,586 1,392,121 1,241,203 6,028 'Y"/f o' 296,028 310,616 4,400 v U i 4,048 2,314 4,702 "x, ` 211,309 199,734 R1 437,616 408,420 275,000 82,200 )78 1,769,228 1,787,105 Sr 25,000 28,641 1,599,389 1,841,424 j "'M .18 894,626 911,478 6° „,:10'7 802,587 869,197 1162'103 9,327,936 9,095,870 R1 The City of Saint John General Fund OPERATING FUND SCHEDULE OF EXPENSE ITEMS (5 of As at December 31 a1 Actual 2007 U 5 Page %f,u pq Recreational and Cultural Services Recreational 77, x- Administration 714,357 Pro Kids It 7 78,101 74,808 Community Centers yd i, 12 36,001N'x7!,`/Q,, ""'1 44,985 1,153,285 Arenas g �wji, 258,103 58 90 1,199,532 Sportsfields 4; 937 56,512 1,370,125 Parks ",53 7 f-136,235 1,507,030 it Cultural 378 (N-� 383,987 369,280 Saint John Free Public Libi-Ai�k Cultural Service; Grants 103 V 94,740 1,039,932 94,390 858,038 3 "D N 7,977,037 7,340,845 ATI 24 The City of Saint John General Fund OPERATING FUND SCHEDULE OF EXPENSE ITEMS (6 of 6) As at December 31 Page G, S Fiscal Services " / 'r, Interest on long -term debt M", Debenture debt 460,072 Other long -term debts Principal installments P Gnu Y Debenture debt�� ; ;',�' , r,6, 100 Other long -term debt 1 j0 ,y , Capital projects financed by ' 1" U , the General Operating Pund� 000,0© Other debt charges 80,�O�J Short-term financyngf 01/1 �' �` 25� 000` 12 Funding of Per►sion�Fund [note 4] ``� 4'144'1165 w t s �l' + Other miscelianecsusaf% " 16,284,270 Lai Actual 8 2007 $ 2,617,622, ' 2,521,078 9,417 11,786 164,100 8,098,100 73,570 79,528 1,000,000 735,000 93,727 54,108 274,524 260,296 4,223,078 5,453,568 617,188 460,072 16,573,226 17,673,536 25 Finam The Wat Deceri roe 4 " l We Operating Fund Balance Sheet Operating Fund Statement of Revenue and Ex Operating Fund Statement of Deficit 4 •. Mlffnms .�� Capital and Loan Fund Statement Statement of Source and Application Notes to Financial S ffill R, 2 3 4 5 6 7 8 -14 AUDITORS' REPORT To His Worship The Mayor and Members of Common Council of The City of Saint John We have audited the balance sheets of the Operating Fund "arid Capital and Loan Fund of The City of Saint John Water and,.,O'Sewerage Utility as at December 31, 2008 and the related statements of revenue %and expenses, deficit, equity and source and application of capital financing foi the year then ended. These financial statements have been prepared "to "comply withSection 8 of the Control of Municipalities Act of New Brunswick. These financial statements are the responsibility of the City's management Our responsibility is' °tp express an opinion on these financial statements based on" audit We conducted our audit in accordance standards. Those standards require; t>za reasonable assurance whether the `fir misstatement. An audit includes exam the amounts and disclosures,, in the fine assessing the accounting principles u management, as °well #§ evaldating the o Canadian generally accepted auditing plan and }erform an audit to obtain ; statements are free of material on aiitesfbasis, evidence supporting 1 statements. An audit also includes and significant estimates made by 1"financial statement presentation. In our opttori, these financial statements present fairly, in all material respects, the financial posit, of The City of Saint John Water and Sewerage Utility as at December 31, 2008 and tiae''results of its operations and the source and application of its capital :financing for the year then ended in accordance with the basis of accounting described in note 1 to these financial statements. These financial statements, which have not been, and were not intended to be, prepared in accordance with Canadian generally accepted accounting principles, are solely for the information and use of His Worship The Mayor and Members of Common Council of The City of Saint John, and the Minister of Local Government of the Province of New Brunswick, and are not intended to be and should not be used for any other purpose. They have been prepared to, and do, comply with Section 8 of the Control of Municipalities Act of New Brunswick. Saint John, Canada, March 24, 2009. 102 Chartered Accountants The City of Saint John Water and Sewerage Utility OPERATING FUND BALANCESHEET As at December 31 Page ASSETS //1////0//f/F' Accounts receivable "/'0" Due from General Operating Fund Due from Water & Sewerage 5 Utility Capital and Loan Fund Prepaid expenses LIABILITIES;, Accounts payab Due to Gen" 1 I 1 Other payables" Interest navable Due to Water" and,Sevs 5 Utility Capital and „ / c � 4. 4 Defici� note 4] G' Sec' accompanying n Signed on behalf of the Council: Mayor ICIT)1 ed chal Loan F Fund 103 ,2008 2007 5,9461086 X5,895,693 ® -® 9,568,929 1,021,051 - -- 55,849 - -- ,— ; 022,986 15,464,622 2,562,315 2,507,877 7,664 17,326 744,136 733,045 293,451 343,699 3,796,275 --- - -- _ 12,012,038 7,403,841 15,613,985 (380,855) (149,363) 7,022,986 15,464,622 Chair of Finance Committee 4 The City of Saint John Water and Sewerage Utility OPERATING FUND STATEMENT OF REVENUE AND EXPENSES Year ended December 31 Budget Actual Actual (unaudited) 2008 ��djrllJl2008 2007 Page Revenues 001 es to customers 26,865 25943,716 26,269,058 Charges to General Operating Fund [note 5] 12 Water supply for fire protection i11 1,882,000 1,853;k26 1,909,618 12 Storm sewerage � �� 986.j�23 918,015 /'1962,024 �— ,$68, 1,21, 2,771,142Y/ 2,871,642 Total revenues 28,714,858 29,140,700 Expenses� �,,� -- Water supply 2,246,678„ 1;857,808 1,809,032 Purification and treatment �` Pumpingsion and distribution ��U�I/ 4216,200 1,057,997 1,0168,898 Sewerage Collection and Disposal] �a�� Sewerage collection system 1 1,630,579 1,347,116 Sewerage treatment and'disposal 1, 3,405,817 3,652,724 3,413,484 y Billing and collectionn �; 422,560 533,791 405,144 Operational support ,y 738,604 674,042 723,702 Engineering °;'�� 772,756 830,090 832,475 12 A oveln »e lon and geriral,„ r t ervices 7rotc „5 , 2,826,561 22878,584 3,058,882 1,7,311,931 17,415,447 _ 16,787,368 See accompanying notes 104 3 Inter6'st bii long -term debt Delieiiturc debt Ii,; 2,490,834 2,167,168 2,072,810 Principal mstallnients 6 Debentui'e'debt 1! rrt, , 5,803,000 5,803,000 5,962,000 Discount on debentures issued 787,950 36,717 61,089 Capital projects,financed by the General Operating Fund 2,898,392 2,898,392 3,753,935 12 Short -term financing costs [,rote 5] 330,000 288,910 430,027 14 Funding pension fund [note 6] 200,177 312,216 518,662 Infrastructure agreement reserve _ 24,500 _ 24,500 _ 24,500 12, 534, 853 11,530,903 - 12, 823,023 Total expenses and fiscal services 29,846,783 28,946,350 29,610,391 Excess of expenses over revenues (113,659) (231,492) (469,691) 4 Excess revenue of previous years 113,659 113,659 62,345 4 Excess of expenses over revenues for the year - -- (117,833) (407,346) See accompanying notes 104 3 The City of Saint John Water and Sewerage Utility OPERATING FUND STATEMENT OF DEFICIT Year ended December 31 Page (Deficit) equity, beginning of year Add: 3 Excess of expenses over revenues for t Deduct: 3 Excess reven yearue of previous s 11 Deficit, end of year erode 41,,n See aeconzpmtying bodes 105 08 2007 320,328 (117,833} (407,346) (267,196)x;; (87,018) (113,659) (62,345) (380,855) (149.363) in The City of Saint John Water and Sewerage Utility CAPITAL AND LOAN FUND BALANCESHEET As at December 31 P; ASSETS Due from General Capital and Loan 1° i 2 Due from Water and Sewerage � Utility Operating Fund 10 Fixed assets [mote 2] '1/0 /silo„ LIABILITIES AND EQUITY 10 Debentures [note 21 Due to General, operating Fund 2 Due to Water "and Sewerage Utility Operating Fund 14 Deferred contribution notc. 8 6 Efu�ty See accon?p —q' nyinsg notes ygr l Signed on behalf,,,,ofthe Mayor i1. 2008 2007 Wj - -- ' 12,012,038 243,778,811 233,629,850 243,778,811 246,895.601 "°� °x'45,504,000 1,244,876 1,021,051 1,510,061 49,279,988 194,498,823 243.778.811 45,307,000 17,483,348 62,790,348 246,895,601 Chair of Finance Committee 0 The City of Saint John Water and Sewerage Utility CAPITAL AND LOAN FUND STATEMENT OF EQUITY Year ended December 31 Equity, beginning of year Debt repaid during the year by the Uf`ility "Operatiii 3 Debenture debt Contributions in aid of construction , Federal and Provincial Govem ei nt �r ; Fixed assets purchased by the UtxlityfOeiafzng Fu 3 Capital projeqs'financed by the Utility d Operat in} Fund 5 Equity, end qi year 5/r_ .See 107 2008 2007 184,105;253 171,773,601 and 5,803,000 5,962,000 5,803,000 5,962,000 1,365,029 1,885,216 d 72,233 399,996 3,153,308 4,084,440 194,498,823 184,105,253 31 The City of Saint John Water and Sewerage Utility STATEMENT OF SOURCE AND APPLICATION OF CAPITAL FINANCING Year ended December 31 2008 2007 8 Source Debenture issue /`l 6,000,000 7,000,000 Government contributions n,,,;�''�1,365,029 1,885,216 Increase in amount due to General Operating Fund i -, - 5,178,905 Fixed assets purchased by Utility Operating Fund 72,233 399,996 Debt repaid by Utility Operating Fund ' 803,000 5,962,000 " Capital projects financed by the Utility Operating Fund 3,153,308 4,084,440 Deferred contributions „t -� „o „' I,510,061 - -- Decrease in amounts from Utility Operating Fund �� J�� 12,012,038 - -- General Capital anti Loan r' d lkoll r 1,253,713 - -- Increase in amounts due,to Water and Sewer i/w Utility Operating Fund " 1,021,051 - -- 7 „0i'�° �' d.. 32,190,433 _ 24,510,557 Debt repayment j 5,803,000 5,962,000 Capital expenditures " 10,148,961 12,915,284 Decrease in amousit due,46 General Operating Fund 16,238,472 - -- Increase in the amount"to from: Utility Operatin,"Fund - -- 4,448,918 General Capital and Loan Fund - -- 1,184,355 32,190,433 24,510,557 See arcompa)ging notes III 7 The City of Saint John Water and Sewerage Utility NOTES TO FINANCIAL STATEMENTS December 31, 2008 1. ACCOUNTING POLICIES These financial statements have been prepared to confonn in all material respects to the accounting principles prescribed for New Brunswick municipalities by the Department of Local Government. Financial Statement Presentation The City of Saint John Water and Sewerage L statements have been prepared in accordance w'tl The Operating Fund reflects the Utility's working and the Capital and Loan Fund reflects ;its in outstanding long -term debt. Fixed Assets and Depreciation ty (the, - ,111"Utility ") financial e fund `Basis of accounting. tal and results of operations tment in f xed,:assets and Fixed assets are recorded at cost .�ti s Funds> > eceived 'through capital assistance programs, cost sharing arrangements; 'kor loa tf tgiveness are treated as additions to equity in capital assets The Utility does not record depreciation on its fixed assets, but an amount equal to annual debt repdyiii— is charged to oper Wns and credited to equity in capital assets. The Utility als charges /ta q/ perations all capital projects that are financed in the current vear,from oneratin funds:' Aceruai Accounting The Utility follows the Accounting for "a Surd method of accounting for revenue and expenses. us or Deficit at the End of a Fiscal Year Section 189(4) of the Municipalities Act of New Brunswick requires that the Utility establish rates which result in a quadrennially balanced budget. Further, Section 189(5)(b) states that should a surplus or deficit exist at the end of a year, it must be spread over a four year period commencing with the second ensuing year. 8 ffl• The City of Saint John Water and Sewerage Utility NOTES TO FINANCIAL STATEMENTS December 31, 2008 1. ACCOUNTING POLICIES (continued) Accounting Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities atfthe date of the financial , statements and the reported amounts of revenues sf /' and, expenses during the reporting periods. Actual results could differ from those eshrnates. Financial Instruments The carrying values of the Utility's financial,' °instruments, except far long -tenn ik debt, approximate fair values because of their short- tei�iu maturity and normal credit terms. The Utility's accounts receivable, do not represent significant concentration of credit risk because,`,,Ahc accounts are %awed by a large number of ratepayers on normal credit terns %� As ;long tens d'ebt��is arranged with the Province of New Brunswick and is riot renegoQ`hiable, the fair values of long -tern debt, affected by changing interest rates, hi /ve notlzb' een determined. At year -end the Utility did not have any,exposure rel4ng to derivative instruments. ime 9 The City of Saint John Water and Sewerage Utility NOTES TO FINANCIAL STATEMENTS December 31, 2008 2. DEBENTURES Debentures consist of the following: Year of Interest Term Issue Rate Years 1998 5.250 to 5.625 10 1999 5.200 to 5.750 10 2000 6.100 to 6.400 10 2001 2.450 to 5.500 10 2002 3.375 to 5.750 �Rl; 2003 3.050 to 5.000 -- 2003 2.750 to 5.125 10 2004 2.750 to 4.800 10 2005 3.750 to 4.3 7,5 10 2006 4.150 to 4.4 5 10 2007 4.450 to 4.850 `k 1,0 2008 3.300 to 4.850 w 1 Q 2008 2.100 m,lo 5.550 Tht del: 20C 201 201 201_ 2013 2008 2007 Balance Balance 378,000 U3,000 1,206,000 6Zf,000 939,000 1,272,000 1,696,000 3,080,000; , „ ,,3,850,000 3,270,000;- , 3,924,000 -o, 6,340,000 7,608,000 7,488,000 7,956,000 2,975,000 3,150,000 ! ; 7,200,000 7,600,000 GYM G,b50,000 7,000,000 2,500,000 -- 1 3,500,000 - -- 45,504,000 45,307,000 payments required on the Utility's long -term is as follows: A 5,725,000 5,122,000 4,809,000 4,385,000 3,615,000 Fixed assets include $4,378,732 (2007 - $4,820,340) for which financing has not been arranged at the year end. 10 Im The City of Saint John Water and Sewerage Utility NOTES TO FINANCIAL STATEMENTS December 31, 2008 3. OTHER PAYABLES Vacation pay Retirement allowance The Utility has provided for vacations earned but,nottpaid. 2008 2007 2007 304,936 275,371 439`240 457,674 744,136 733,045 Employees upon retirement from the City o�,5aint John are entitle "drto a retirement �i��, ,»O pay allowance equal to one month's pay ;Jo,4' ,�naximtun of six months, for every ,,.,;w five years of service. The program has been 4amencied to provide certain employees with a payout option prior to retirement Accepting the early payout yl j/ option eliminates further accumn jatton of retirexnent� allowance entitlement for those employees. Employees of Local 18 hired after hne ,l %' 1 *998,' an`d Management employees hired after March 23rd; 2069; are not eli ble for retirement allowance, now or in the future. These''polieics are established in the Local 18 collective bargaining agreement and the Management terms and conditions of employment. 4. OPERATING FUNDSURPLUS(,/OR DEFICIT The, >surplus or deficit,/)or each"""""""' is taken back into income over a four year period commencing with the second ensuing year. The balances remaining at the end of eacl ,,vear are as follows: a, 2008 2007 2004 49,314 98,628 2005 196,052 294,086 2006 (101,042) (134,731) 2007 (407,346) (407,346) 2008 (117,833) - -- (380,855) (149,363) 11 112 The City of Saint John Water and Sewerage Utility December 31, 2008 5. TRANSACTIONS WITH THE CITY OF SAINT JOHN GENERAL FUND The Water and Sewerage Utility Operating Fund Operating Fund $1 ,367,000 (2007 - $ 1,337,000) government operating costs. In addition, the General for storm sewerage costs $918,016 (2007 - $962,024) protection $1,853,126 (2007 — $1,909,618). Interest is charged on the balances between Sewerage Utility on a monthly basis. The Utility's water cost transfer is withifi based on the applicable percentage of population.,a 6. PENSION PLAN A. OVERVIEW The City provides pensioi provisions of the revised Cry-, 1994 and last,amended, 6n Apr~ Trustees, rreprese tmg Coi 0 I rerired' mployees 'nor 6"4'N Saint Jahn Pension A`ct 1970 Brunswie - "Pension Benefits Ai reimbursed the General for its share of general Operating Fund is charged and water supply for fire Fudd;and the Water and allowable b- Vregulation expenditures for the benefits tb,� employees in accordance with the 11 of Saint JA` erasion Act as enacted on May 12, 128;0}1 The plan is administered by a Board of n Couricl, management, unionized employees and iay,1994, the plan was governed by The City of °fThe plan is subject to the provisions of the New -t which became effective January 1, 1992. The plan is a defined by efit plan which provides for pensions based on length of service and rate` "of" `pay. Both the municipality and the employees make contributions to the plan. The City's contribution limits are fixed by legislation at a minimum amount of 7% of employee earnings. The City is currently contributing at a rate of 11.6% of salary. Effective May 1, 2007 the employee contribution rate was changed from 8.5% to 10.5% of pensionable earnings. The additional 2% employee contributions will be made until the sooner of May 1, 2010 or to the date when the going concern unfunded Iiability has been eliminated. The City charges all of its contributions to expense in the year the 12 113 The City of Saint John Water and Sewerage Utility NOTES TO FINANCIAL STATEMENTS December 31, 2008 A. OVERVIEW (continued) contribution is made. The amount contributed for employees funded by Water and Sewerage Utility for 2008 was $1,075,012 (2007 - $1,042,015). B. ACTUARIAL INFORMATION The 2006 actuarial valuation indicated the present,value of accumulated plan benefits was $396,778,000 and the adjusted markety"alue 6f net assets available to provide benefits was $365,763,100 with an ,estir`iiated unfunded liability of $31,014,900 on a going concern basis. As of Dec"�"ember 31, 2006 ,the liabilities on a solvency basis were greater than the solvency assetsyby $106,832,800. The 2006 valuation has been updated by extrapolatlo "n to'December'31, 2008 and the results indicate that the accumulated plan benefits now exceed the adjusted market value of assets available t6provide benefitsresulting in a deficiency of v $150,573,229 on a going concern basis This valuation relates to the entire plan= both the General F�uhd'and, the Water special funding payments areallocated of payrolls.'`" C. DU P 1 indludes employees funded through Sewerage Utility. Current costs and ch fund on the basis of a percentage The"New Brunswick Per sion Benefits Act requires that a solvency deficiency be funded o`ve�r a period of years unless an exemption is requested to fund over a period of no�nlore than <5 years, or the period to December 31, 2018, whichever is shorter, or an,exempton from making solvency payments is granted. In 2007 this exemption from making solvency special payments to the pension plan was sought and received. As a result of receiving this exemption there is no longer solvency funding due from the City of Saint John as at December 31, 2008. IN 114 The City of Saint John Water and Sewerage Utility 1 1 December 31, 2008 C. DUE TO THE PENSION PLAN (continued) During 2008 the City of Saint John paid the plan $2,623,662, which represented required special funding and interest on a going concern basis (2007 — $4,358,454). The Utility Fund's share of this for 2008 is $312,216. The City of Saint John is required to make special going concern payments until 2018. 7. INTER -FUND ACCOUNTS All inter -fund accounts at December 3I, 2008 represent current transactions and are in compliance with the policy established by the Department of Local Government. The Province of New Brunswick Clean Up Trust in the amount of $ third share of the Harbour Clean released to the City as ,c,osts of the p 2008 no trust funds have released ") established the Saint John Harbour aan to pzovidie;far the Province's one - `,cost These Trust funds will be are approved. As of December 31, City. According to the terms an conditions ff7the Deed of Settlement and Trust Agreement interest inc uted to the City annually. The amount of interest'cizstnuted to t ity as ecember 31, 2008 is $1,510,061, which has begin deferred and will ed to the project in the future. There are no snedi i, Aerins on the usage of tnterest deferred. 221 115 Financ The Resc Deceit ime To His Worship The Mayor and Members of Common Council of The City of Saint John We have audited the balance sheet of the Reserve and Tt Funds of The City of Saint John as at December 31, 2008 and the statein I b % aanges in equity for the year then ended. These financial statements h" e beenpared to comply with Section 8 of the Control of Municipal es New F3rswick. These �,. financial statements are the responsibility 4�f the City's man ent. Our responsibility is to express an opinion on th se hnanbj�al statements b ed rn our audit. I„ % We conducted our audit in accor lanes standards. Those standards requll`;`�"„� reasonable assurance whether th �f misstatement. An audit includes ex4 the amounts and disclosures in the fi assessing the acccati% principles management, as a 11 as ev*"' rrg the with Canaciasn, generally accepted auditing it we plan ,,on n an audit to obtain statemeri �; at'e free of material rnrrn „n a test basis, evidence supporting and 9 An audit also includes i i and si "Acant estimates made by �vrall financial statement presentation. u , In our opinion, then nan aid statements ►resent fairly, in all material respects, the fina vial position ca °l'lie tt F% It John Reserve and Trust Funds as at Dec e� 31; >;14 and e changes in equity for the year then ended in aco (dance with t i asis bf, a gpunting described in note f to these financial These f) 4ncial statem rots, which have not been, and were not intended to be, prepared ins "crdanc `with Canadian generally accepted accounting principles, are solely for tfi ,znf rnation and use of His Worship The Mayor and Members of Common Couno f''of The City of Saint John, and the Minister of local Government of Elie Province of New Brunswick, and are not intended to be and should not be used for any other purpose. They have been prepared to, and do, comply with Section 8 of the Control of Municipalities Act of the Province of New Brunswick. Saint John, Canada, March 2, 2009. 117 Chartered Accountants cG 00 GOS kri co 7r Z M FPM t-n V) (A T3 rA eel i C-41 c �T* L�a rid C5 kn jo GO'31 00 r 00 00 wj l GO!� L7 Cry M fn MCI cz CA cz 'i5 sa, cG 00 V) o w 41 � 4. 0 .4. 1-1 W GJ rn It as IN CA (11 +-V wra ON oc 40. 0 c . . . . . . . . . . t'q) 0 cr ^C oar rn 66 V, 71 00 W-� C4 GO!l C4; co 00 14D tr � M M CD 'r fn C'4' 'r- ej u an 5y t4 !�2 The Cite of Saint John Reserve and Trust Funds NOTES TO FINANCIAL STATEMENTS December 31, 2008 I. SIGNIFICANT ACCOUNTING POLICY These financial statements have been prepared to conform in all material respects to the accounting principles prescribed for New Brunswick municipalities by the Department of Municipal Affairs and Environment. /1 '` Accrual Accounting The City follows the accrual method of accountr g'f r i'evenuc aid expenses. 2. RESERVE FUNDS Machinery and Equipment Depreciation Under Section 90(4) of the Muni6palitles Act, Couhoi by resolution can create an equipment replacement reserve �'Cctnttributions to thx� °fiund are made through the operating budget of the Genera ;Fundrsburseme is from this fund may only be made for the acquisition o e(pi"mont 1111, require the approval of Common Council.. Airspace 2 This fundwas establ`ih, in 1 atll'hespect to the development of Market Square' grid to ; a riiculdr e conduri i rum development. Upon the sale of air ce to allow r the con tb'uction of the project, the proceeds were invested to all.' for the reacquf$Kion by City of this airspace in the year 2049 when the owner p of the coin x rove s to the City of Saint John. 3 120 The City of Saint John Reserve and Trust Funds NOTES TO FINANCIAL STATEMENTS December 31, 2008 3. TRUST FUNDS Land Subdivision Fund Section 43 of the Community Planning Act requires tl al: `mobies received by Council in lieu of land for public purposes are paidm�rn,to a special account. Council may expend these funds for acquiring osevelprng land for public purposes as defined by the Community Planning Tucker Fund By an Act of the Legislature enacted April 20, 19927 securities with a par value of $10,000 were vested with the City of Saint Jc�h1� "This Act provided that the income and a portion of the p�rncipal from this Trust, with the approval of Common Council, should be us, for the mainten'a Oe and improvement of Tucker Park.„ Stockford Mem This fund was , s blished "bn Decembe"i�, -,.28, 1939 as a result of a bequest of $3,000 frorn Fanifi 1 . Sto ford of Bosto �,�- i"v'Iassachusetts. This amount was to be invested and the ; n�u 'ntcome was tra be used towards the upkeep and rnaintenad fKiniz Fund This iM""nd vas cstablis ed on March 22, 1939 with a contribution of $2,000 from T.D. O'CorIl. The contribution was to be invested and the income distributed among the orp ,anages�,'of the City on the pro -rata basis of the children cared for by each, to be r , °by way of a Christmas gift to each child. In October, 2004 this agreement ws amended to allow the Trustees to disburse the income arising from the trust investments yearly to the Empty Stocking Fund, Ei 121 The City of Saint John Reserve and Trust Funds NOTES TO FINANCIAL STATEMENTS December 31, 2005 3. TRUST FUNDS (continued) L.R. Ross Fund This fund was established in 1921 through the gift off,, 1,25`0 and the `'Ross Memorial Cup ". The cup was to be competed for ai44ally by amateur single scullers, twenty -one years or under who are residen s 6f th+��,Maritirne Provinces. The income from this Trust is to be used to provide 6�14uplica ewo p for the winner of each race held. Changes to the Trust in 1'9$+ "allow for ",,Q funds to be used to promote the sport of rowing within t]� City of Saint John aifd its suburban communities, provided that $'4,000 renpins to the and to enable4w -Ross Memorial Cup" to be duplicated when necessary ,, ., 1 A. Carle Smith Fund Established in September 1976, funds ``" ) Smith. These funds are to be used 6t the the South Bay area. 1/ Bi- Centennial Fund These funds are to' "1 Canadaiti "ihe %guar 20 ;the estate of A. Carle a wildlife sanctuary in marking the 200`x' anniversary of John Non- PiOfit Housipg,,Fttture Development Fund This fuuil,,was establis1l"�l in 187, on the sale by the City of the Rockwood Court Complex: "y resolutt6n of Common Council, the proceeds in excess of the amount requqred,i o m `et the outstanding obligations of the complex, amounting to $470,726, wezw to be set aside and administered by Saint John Non -Profit Housing lncorpgf`ated. This fund was to be used for new housing initiatives subject to restrictions set out by the City of Saint John. 5 122 .7�G Ni July 27, 2009 Common Council of the City of Saint John His Worship Mayor Ivan Court and Members of Common Council, Subject: Committee of the Whole Closed Session The Common Council meeting of July 27, 2009 contains the following items on the agenda: 1.3 Employment Matter 10.2(4)(j) Section 10.2(4) of the Municipalities Act states: "If it is necessary at a meeting of Council or committee of council to discuss any of the following matters, the public may be excluded from the meeting for the duration of the discussion ": 1.3 Employment Matter 10.2(4)(j): (j) labour and employment matters, including the negotiation of collective agreements; Respectfully Submitted, MIN'T' J01-IN P.O . 71 Saint John, NB Canada tjohn.ca « 71 Saint John, N.-B. Canada F-2L 4L' 123 _.., ... . Elizabeth Gormley Common Clerk MIN'T' J01-IN P.O . 71 Saint John, NB Canada tjohn.ca « 71 Saint John, N.-B. Canada F-2L 4L' 123