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Contribution & Expenditure Overview
2016-2020 FINANCIAL PLAN
OTHER CONTRIBUTIONS
Other contributions in nature are usually from sources external to the City, and
therefore, they also include external borrowing.
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 City 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 By-law
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 by-law. 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.
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.
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.
The City of Surrey’s gross borrowing
capacity is $1.4 billion. Outstanding
external long-term capital borrowing at
December 31, 2015 is $196,316,195. The
City’s cash re-payments of loan principal
are held in a sinking fund administered by
the Municipal Finance Authority of British
Columbia (MFABC). The sinking fund
earns interest through an investment
program managed by MFABC. In addition
to the cash re-payments, the earnings on
the sinking fund are also applied as a
reduction to the outstanding loan
balance.
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