2013 Operating Budget Variance Report Monthly Update

Staff memo.

At its meeting of September 15, 2013, the Corporate Administration, Finance and Enterprise Committee received the June 2013 Year End Variance Report that identified a projected year end unfavourable variance of $2.36 million (as of June 30, 2013). CAFE Committee further directed staff to provide monthly updates on progress towards mitigating the projected variance. This e-mail is provided as the first of these updates and identifies a range (worst case to best case) of initiatives that have been derived through the number of internal cost containment and mitigation strategies described in the June 2013 Year End Variance Report and the Efficiency Target Report received by CAFE at the same meeting of September 15, 2013. These offsets are being implemented with no impact on service levels. In total, save other unexpected pressures and/or savings occurring between now and year end 2013 staff currently project as of August 31, 2013 that there will be no (zero) year-end variance in 2013.

Projected Variance (as at June 30, 2013) $2.4 million

Less:

City Departments Cost Containment $0.5 – 0.8 million
Reduced Benefits (new Contract September 2013) $0.2 – 0.2 million
Lower Utility Costs (Community Energy Program) $0.6 – 0.8 million
Lower Tax Write Offs / Higher Supp Revenue $0.5 – 0.8 million

Sub-Total Mitigation / Cost Containment Strategies $1.8 – 2.6 million

Projected Shortfall / (Surplus) Before Reserves $0.6 – (0.2) million
(as at August 31, 2013)

Legal Reserve $0.3 – 0.0 million
Winter Control Costs Reserve Offset $0.4 – 0.0 million

Projected Shortfall / (Surplus) After Reserves $(0.1) – (0.2) million
(as at August 31, 2013)

The overview provided here relates to City departments only. Efforts are also already underway to work with the Local Boards and Shared Services areas to determine what contributions they may be able to make to these mitigation and cost containment strategies. Staff intend to include some outcomes from these when reporting out through the next 2013 Operating Budget Variance Report monthly update in November 2013 as well as through the 2013 Operating Variance and Efficiency Target staff reports scheduled in December 2013. In summary, staff remain confident that the upper range described in the totals above can be achieved such that in combination with other contributions outside City and corporate departments it will not be necessary to tap the Legal or contingency (for winter maintenance) reserves. Staff

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