Council for the Township of Madawaska Valley formally approved its 2020 budget, along with the 2019 audited financial statements of the municipality, at a Special Council Meeting on May 19th conducted via livestream video on YouTube. All members of Council were present apart from Councillor Ernie Peplinski who sent his regrets. Viewers joined the real time broadcast as Council returned from a closed session. One item they had discussed in private was identified as “Letter from the Treasurer – Management’s Responsibility for the Consolidated Financial Statements.” Mayor Kim Love reported on the closed session saying, “Council was educated on the financial statements and had an opportunity to review those with Mr. Healey.” Jason Healey of MacKillican & Associates, auditors for Madawaska Valley, then presented the 2019 audited Financial Statements. Healey’s management letter stated, “During the course of our audit, we identified a number of deficiencies that met the definition of a significant deficiency.” MV Treasurer Amanda Hudder then responded to the auditors’ letter and gave highlights of the 2020 budget.
Auditors’ recommendations addressed
Treasurer Amanda Hudder presented a report speaking to the auditor’s concerns which he identified as significant (some had been noted in previous financial years) around bank reconciliations, tax and general ledger reconciliations, accounting software and training, record keeping procedures for grants and special projects. Hudder explained the processes and plans MV Finance Department has already implemented to address the concerns saying she welcomed opportunities to improve their processes.
Budget Summary
Hudder also presented the highlights of the 2020 budget. The Budget Summary shows expected tax revenue of $3.9 million and the budget allows for a levy increase of 2.2 percent. Taking into account the weighted Current Value Assessment change of 1.89 percent, the residential tax increase is 0.32 percent. Tax collected includes support for education, which has decreased. Hudder explained that the overall tax rate for the 2020 fiscal year is decreasing by 0.41 percent compared to 2019. She said this means that for every $100,000 worth of assessment, the Overall Total 2020 tax rate will equate to $1,034.88 of taxes compared to the 2019 tax rate which would equal $1,039.12
During the discussion that ensued, it was pointed out that MPAC has confirmed that it will not do an assessment revaluation in 2020, so MV property owners can expect to receive notice from MPAC in June 2021.
Because of major capital projects (e.g. Paugh Lake Road $3 million), the township’s 2020 total expenditures have increased significantly, much of it offset by grant funding. 2019 actual expenditures were $7.9 million while 2020 expenditures are projected at $10.6 million. A quick glance at the departmental breakdown of expenditures shows how much MV is investing in roads (see “Transportation” at left in the chart below):
Of the total $10.6 million projected expenditures, $5.9 million (55.5 percent) has been allocated to roads. After grant income totalling $3.1 million for specific roadway projects, the net amount to be spent on township roads is $2.8 million (26.5 percent).
No grant income is anticipated during this year for Environment, Economic Development, Recreation or Culture.
Of note is that the sum of only $106,776 (1 percent) has been budgeted for Economic Development. Such a low apportionment may well provide fuel for those residents who feel that Economic Development should be a much greater priority.
COVID-19 impact
Hudder explained that staff had re-visited the budget after the province issued the COVID-19 Emergency Orders. The projected increase was reduced to 2.2 percent from the 3.3 percent suggested in early March. She listed the financial impact of the coronavirus:
- projected revenues were reduced by $96,250
- projected expenses across all departments was reduced by $218,464
- drawings from reserves were reduced by $77,000
Council’s response
Members of Council thanked Hudder and all municipal staff for their work. In response to a request from CAO Suzanne Klatt to bring forward ideas for service review, software improvements, etc., Councillor Mark Willmer said, “We have come a long way with staff in the last two years. When I first came on or was looking at the municipality just prior to coming on [Council], to me it seemed like we operated in so many silos. Now we have people who are aware of what other departments are doing, they are able to back them up, fill in, and that’s a tremendous achievement in two years. I’d like to give some credit also to Sue [Klatt] for that because she’s obviously instigated and created a whole new model…. I think we are moving in the right way and the timing is perfect to keep moving this way.”
COVID-19 update
Council also heard an update from Klatt on the municipality’s COVID-19 response. The township continues to conform to federal, provincial and public health guidelines. Effective this week the municipality received permission to issue building permits. MV staff will contact all current applicants during the next two weeks.
Tender accepted for new plow truck
Operations Manager Hilary Kutchkoskie joined the meeting briefly as Council approved acceptance of the low tender for a new plow truck from Francis Canada Truck Centre Inc. at $295,590. He was directed to place the order so that the truck will be ready for use by the fall.
