COS Financial Plan 2018 - 2022

CONTRIBUTION & EXPENDITURE OVERVIEW

Other Statutory Reserve Funds The Community Charter allows for the establishment of less restrictive statutory reserve funds. Two examples of these types of reserve funds are the Municipal Land Reserve and the Vehicles and Equipment Replacement Reserve. Legislation requires that proceeds from the sale of parkland be deposited into a statutory reserve fund and can only be used to purchase parkland. All other proceeds from land sales are deposited into the Municipal Land Reserve as per Bylaw 6474.

Once the funds have been deposited, they may be used without restriction as long as the planned expenditures are authorized by Council and meet with the intended purpose set out in the bylaw. The City is also permitted to appropriate, from general operating funds, to a Capital Works Reserve Fund for the purpose of replacing machinery and equipment to maintain City property.

OTHER CONTRIBUTIONS Other contributions in nature are usually from sources external to the City which include the following:

External Resources External or sundry funding sources are contributions to capital projects from individuals or external organizations, including senior governments.

These contributions vary from year to year in accordance with changes in government grant programs and opportunities for private sector partnerships. Some projects are dependent on these contributions to proceed. The City of Surrey’s gross borrowing capacity is $1.60 billion. Outstanding consolidated external borrowing at December 31, 2017 was $267,219,000. Of this external borrowing, $185,457,000 relates to City debt through the Municipal Finance Authority of British Columbia (MFABC). The City’s cash re-payments of MFABC principal are held in a sinking fund administered by MFABC. The sinking fund earns interest, known as actuarial earnings, through an investment program managed by MFABC. In addition to the cash re-payments, the actuarial earnings on the sinking fund are also applied as a reduction to the outstanding loan balance.

Borrowing Long-term borrowing limits for

municipalities within the Province of BC are determined by the criteria established under Section 174 of the Community Charter ([SBC 2003] Chapter 26). These borrowing limits are based on a municipality’s ability to service their debt. Debt servicing limits are based on 25% of the following:  The annual revenue for the previous year; less  The annual debt servicing costs including contingent liabilities.

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2018-2022 Financial Plan

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