Frontenac County Council - July 11/13

Jeff Green | Jul 11, 2013

Frontenac County reserve funds to stay put for now

After spending two meetings talking about millions of dollars that they hold in various reserve funds, Frontenac County Council has decided to complete a strategic plan.

Although the county holds up to $15 million in various reserve funds, much of that money is tied to the future needs for the two largest service areas of the county, Fairmount Home and Frontenac Paramedic Services.

The two pots of money that most concern Council are the working fund reserve, which Treasurer Marian VanBruinessen estimates will be about $4.5 million by the end of 2013, and $1.5 million in accumulated Federal Gas Tax Rebate money that has not been spent.

Everyone on council, as well as County Treasurer Marian VanBruinessen and the county's auditor, Howard Allen, agreed that $4.5 million is high for a working fund reserve.

In a report to Council, VanBruinessen pegged the requirement for the working fund at as low as $1.8 million, and she discussed various options for allocating the excess funds for future projects.

Alternatively, she wrote, “If, ... , Council has no interest in identifying and addressing these or other issues on a regional basis, the remaining funds should be redistributed to the townships.”

Howard Allen said, “If I were in your position, I would first look at what you really need. Once you know how much that is - say it is 8 million or 10 million, whatever it is - then you can decide what to do with the rest.”

Warden Janet Gutowski agreed with Allen.

“We should not lose the point Mr. Allen is making. What are our long term goals? Over all we have some big, big challenges. Part of our duty at this table is to look at those infrastructure challenges,” she said.

On the other hand, the representatives from Frontenac Islands wanted to find out how the reserves have been built up to the level they are now, with a view towards giving the money back.

Dennis Doyle proposed that an analytical review be done of reserve allocations since municipal amalgamation came about.

“We need to know how we got here, because it looks to me like we have been overtaxing our residents for 15 years,” Doyle said.

Doyle's proposal to do a review was defeated.

A proposal, sponsored by Warden Gutowski, to undertake a strategic planning exercise, with input from the township councils and the public, was accepted by Council.

Council recently rejected the results of a strategic planning exercise, but this time Council itself will oversee the process in the hopes of coming to a more acceptable result. The details will need to be worked out, but the process will be linked in some way to a services review that has already been undertaken, also as a council-driven project.

In the meantime, the working fund reserve will be left as it is, at the $4.5 million level.

As far as the gas tax surplus is concerned, Frontenac Islands Mayor Dennis Doyle made it clear he would like to see that money transferred to the townships immediately.

“I think we should put that $1.5 million immediately back to the townships,” he said.

Doyle's position received unexpected support from the county auditor, Howard Allen, who presented an overview of reserve fund policy at the most recent meeting on county reserves, which was held on July 3.

“Certainly gas tax funds should be transferred to the townships, where the roads are managed,” he said.

Allen was then corrected by County Chief Administrator Liz Savill, who said, “No, there are other recommended uses for those funds; roads are at the bottom of the list.”

“I did not know that,” Allen responded, “most of my municipal clients spend the money on roads.”

Over the years, Frontenac County has spent much of its gas tax rebate money under the catch-all category of “capacity building” and on county trails.

Council has gradually increased the amount of its gas tax funds that are transferred to the townships, and this year all the new money was transferred. The $1.5 million that is at issue is banked money from previous years.

“My position on the gas tax is that we should make a yearly decision on where the new money should go, but we should keep the surplus here,” said South Frontenac Mayor Gary Davison. “But we need to make decisions on the front end about what we are funding with that money. That hasn't always happened.

A motion to keep the $1.5 million gas tax surplus in place at the county was passed by Council.

No other changes to the various other county reserve funds are being contemplated at this time.