AGENDA AND BUSINESS PAPER

 

 

Ordinary Meeting of Council

 

 

 

To be held on
Monday

25 May 2020

AT 6:00pm

 

 

The Council meeting will

be held remotely using

video-conferencing and livestreamed on

Council’s website

 

 

Phone: 1300 292 442
Fax: 02 6926 9199
Website:
www.wagga.nsw.gov.au


NOTICE OF MEETING

 

In pursuance of the provisions of the Local Government Act, 1993 and the Regulations there under, notice is hereby given that an Ordinary Meeting of the Council of the City of Wagga Wagga will be held remotely using video-conferencing and livestreamed on Council’s website, Wagga Wagga, on Monday 25 May 2020 at 6:00pm.

 

Council live streams video and audio of Council meetings. Members of the public who provide a public address (via remote access) are advised that their voice and/or image may form part of the webcast.

 

2Peter_500px

 

Mr Peter Thompson

General Manager


WAGGA WAGGA CITY COUNCILLORS

 

 

Councillor G

Mayor

Councillor Greg

Conkey OAM

Councillor D

Deputy Mayor

Councillor Dallas Tout

Councillor Y

Councillor Yvonne Braid

Councillor P

Councillor Paul Funnell

Councillor D

Councillor Dan Hayes

Councillor V

Councillor Vanessa Keenan

Councillor R

Councillor Rod Kendall

Councillor T

Councillor Tim Koschel

Councillor K

Councillor Kerry Pascoe

 

 

 

 

 

 

QUORUM

The quorum for a meeting of the Council is a majority of the Councillors of the Council who hold office for the time being who are eligible to vote at the meeting.


COUNCIL MEETING ROOM

 


Reports submitted to the Ordinary Meeting of Council to be held on Monday 25 May 2020.

Ordinary Meeting of Council AGENDA AND BUSINESS PAPER

Monday 25 May 2020

ORDER OF BUSINESS:

CLAUSE               PRECIS                                                                                       PAGE

PRAYER                                                                                                                       3

ACKNOWLEDGEMENT OF COUNTRY                                                                          3

APOLOGIES                                                                                                                 3

Confirmation of Minutes

CM-1           Ordinary Council Meeting - 11 May 2020                                         3

DECLARATIONS OF INTEREST                                                                                    3

Motions Of Which Due Notice Has Been Given

NOM-1         NOTICE OF MOTION - EMPLOYEE EXPENSES                                         4

NOM-2         NOTICE OF MOTION - LOCAL GOVERNMENT ELECTIONS                      7

NOM-3         NOTICE OF MOTION - NOTICE OF MOTIONS                                            9

NOM-4         NOTICE OF MOTION - ACCESS TO GREEN SPACES AT SCHOOLS       11

NOM-5         NOTICE OF MOTION - PEDESTRIAN CROSSING ON LAKE ALBERT ROAD       13

Reports from Staff

RP-1            DA19/0603 - ALTERATIONS AND ADDITIONS INCLUDING REAR EXTENSION AND GARAGE AT 93 BEST STREET, WAGGA WAGGA, LOT 17 SECTION 49 DP 759031    15

RP-2            RIVERINA JOINT ORGANISATION                                                           19

RP-3            Integrated Planning and Reporting - Draft Long Term Financial Plan 2021/30 and Combined Delivery Program and Operational Plan 2020/21 22

RP-4            Indicative Financial Impact of COVID-19 on Council's 2019/20 Budget       29

RP-5            Financial Performance Report as at 30 April 2020                  32

RP-6            Temporary Amendments to Council's Financial Hardship Policy - POL 102 and Debt Management Policy - POL 017                                        51

RP-7            DA17/0663.02 - Request for Deferral of Developer Contributions - Sewerage - 50 Edward St Wagga wagga Nsw 2650                    77

RP-8            Events Strategy and Action Plan 2020-2024                               84

RP-9            14 SEPTEMBER 2020 COUNCIL MEETING                                             161

RP-10          RESPONSE TO QUESTIONS/BUSINESS WITH NOTICE                         163


 

 

Committee Minutes

M-1              TRAFFIC COMMITTEE – MEETINGS HELD 28 APRIL 2020 AND 14 MAY 2020    165   

QUESTIONS/BUSINESS WITH NOTICE                                                                     176

Confidential Reports

CONF-1       2019/20 Loan Facility                                                                        177

CONF-2       RFT2020-01 RIFL HUB 2 and 3 DESIGN and CONSTRUCT                  178

CONF-3       RFT2020-15 ASHMONT PUMP STATION, SEWER AND RISING MAIN    179

CONF-4       RFT2020-28 MUSEUM REDEVELOPMENT DESIGN & CONSTRUCTION 180

CONF-5       RFT2020-21 CATTLE FAN DRAFT CONSTRUCTION LMC                      181

CONF-6       RFT2020-30 LIVESTOCK MARKETING CENTRE SHEEP YARD DESIGN & CONSTRUCTION                                                                                    182

CONF-7       Tenant Hardship                                                                               183

CONF-8       Sewer Easment Acquisition - 112 Harris Road, Gobbagombalin - Lot 1 DP1253252 -                                                                                           184

 


 

 

PRAYER

 

 

ACKNOWLEDGEMENT OF COUNTRY

 

 

APOLOGIES

 

 

Confirmation of Minutes

CM-1              Ordinary Council Meeting - 11 May 2020       

Recommendation

That the Minutes of the proceedings of the Ordinary Council Meeting held on 11 May 2020 be confirmed as a true and accurate record.

 

 

Attachments

 

1.

Minutes Ordinary Council Meeting - 11 May 2020

185

 

 

DECLARATIONS OF INTEREST


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

NOM-1

 

Motions Of Which Due Notice Has Been Given

NOM-1           NOTICE OF MOTION - EMPLOYEE EXPENSES

Author:          Councillor Paul Funnell

 

Summary:

The purpose of this notice of motion is to adopt a position of no increases in salaries, wages or payments for the year 2020/2021 and request support for this position through agreement and legislation.

 

 

Recommendation

That Council:

a       adopt a position of no increases in salaries, wages or payments for the year 2020/2021 to Councillors, contracted senior staff and all other employees.

b       approach LGNSW, the Office of Local Government and the relevant unions to negotiate and establish a legal framework for this implementation

c        notify the Premier the Hon. Gladys Berejiklian MP, NSW Treasurer the Hon. Dominic Perrottet MP, and the Minister for Local Government the Hon. Shelley Hancock MP of this position of council

 

Report

As an organisation we are looking for a methodology to offset known looming financial losses for future financial periods. Given that we find ourselves in unprecedented times due to the COVID-19 pandemic, this situation places economic pressure on every sector of the economy/community.

 

The recommendation is to ‘adopt a position’ and requests support for this position through agreement and legislation. We as a council cannot enforce this ourselves. However, given that we are responsible for our budget we must put forward and look at all options regarding what and how we consider to be responsible and considered actions to deliver principled and sustainable budgets in the best interests of the community that we represent.

 

Wagga Wagga City Council (WWCC), is not immune to these impacts and we already know that we have a looming $4.3m deficit for 2021/2022. Our current rateable income is $44.9m, this however is not inclusive of annual charges for kerbside, sewer and stormwater totalling $26m and further user fees and charges of $22.5m. These further charges must however be considered cost of doing business at a service delivery level.

 

Our current employee expenses for benefits and on-costs sits at a salary budget of $49.4m. Under the current arrangement this grows exponentially approximately 4.1% annually, thereby on current figures at a cost of $2M and grows exponentially annually.  These figures are a high level snapshot of one section of our operational program and budget. The current situation is unsustainable even in good times let alone our current and future circumstances. Reigning in spending through this proposed position is one place to reign in an unsustainable budget. It is certainly not the low hanging fruit, we must continue to look under every rock, nook and cranny to find savings.

 

A salary freeze for 12 months would make a large contribution toward saving our budget whilst at the same time secures jobs and allows an opportunity to look for further options at our internal operation. To consider ‘business as usual’, rely on raising revenue, and not consider cost saving measures is just a road map to further economic, community and business hardship. We are not in control of our income; however, we are in control of our expenditure. We are looking for less than 2% of our overall annual budget to plug the shortfall, this concept finds approx. 45% of the budget shortfall and not the loss of one position.

 

This is not a position of, ‘everyone else is hurting so we should too’, this is a case of every other sector of the community have suffered job losses and business closures with a catastrophic destruction of our economy. Many of these situations won’t be remedied for years to come, if at all. Therefore, simply put, the rest of the community won’t be in a position to pay for increased costs for services we provide leaving us in the position that we must and need to cut expenditure and look for efficiencies.

 

We all, everyone in our organisation hold privileged positions that are protected and unique, we must never lose sight of that. What this report calls for is forgoing one annual automatic increase of 2.5% plus loadings, a total of 4.1%.

 

Personally, I believe there should be actual cuts to contracted salaries and upper levels of pay like many other institutions have had to do to save budgets and jobs. However, I do not believe the appetite is present with Councillors or Council to adopt such a position. I will therefore leave the recommendation as a one-year freeze.

 

As Councillors we represent the constituents of our LGA, as an organisation we are a service provider, to the community, that is ultimately funded by the community. We can no longer rely on living off grants or proposed handouts, we must be responsible for our own budget and destiny and therefore live within our means where possible.

 

Financial Implications

N/A

Policy and Legislation

Wagga Wagga City Council Code of Meeting Practice

 

Link to Strategic Plan

Community Leadership and Collaboration

Objective: We have strong leadership

Outcome: We have leaders that represent us

 

Risk Management Issues for Council

N/A

Internal / External Consultation

N/A

  


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

NOM-2

 

NOM-2           NOTICE OF MOTION - LOCAL GOVERNMENT ELECTIONS

Author:          Councillor Paul Funnell

 

Summary:

The purpose of this notice of motion is to lobby the NSW Government to request that the local government elections be held in September 2020 as originally scheduled (or as close as possible).

 

 

Recommendation

That Council:

a       write to the Minister for Local Government Minister, the Hon. Shelley Hancock MP requesting that local government elections be held in September 2020 as originally scheduled (or as close as possible)

b       take this motion to the Riverina Joint Organisation (RJO) and Canberra Region Joint Organisation (CRJO) seeking support in this request

 

Report

At the height of the COVID-19 crisis, NSW Parliament passed legislative changes to the Local Government Act 1993 (the Act) enabling the Minister, a time-limited power to postpone Council elections.

 

As a result, the Minister for Local Government announced that the September 2020 local government elections will be postponed to address the risks posed by the COVID-19 virus.

 

It’s now time to overturn the decision and give communities an opportunity to have their democratic say in a timely fashion. The original decision appears to have turned out to be overkill and the responsible thing to now do is reverse it.

 

Financial Implications

N/A

Policy and Legislation

Code of Meeting Practice

 

Link to Strategic Plan

Community Leadership and Collaboration

Objective: We have strong leadership

Outcome: We have leaders that represent us

 

Risk Management Issues for Council

N/A

Internal / External Consultation

N/A

 

 

 

  


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

NOM-3

 

NOM-3           NOTICE OF MOTION - NOTICE OF MOTIONS

Author:          Councillor Tim Koschel

 

Summary:

The purpose of this report is to receive a report back from Council about setting a policy in place for notice of motions from councillors.

 

 

Recommendation

That Council:

a       builds or amends its current policy for Notice of Motions

b       include a time frame for Notice of Motions to come back to Councillors

c        builds a register on Council’s website, so the community can track Notice of Motions from Councillors and update everyone when reports are due back to Council

 

Report

Since joining Council in 2016, I have lodged multiple Notice of Motions to Council meetings. Not one of these Notice of Motions have come back as a report to a Council meeting. Majority of these Notice of Motions were passed by all Councillors.

 

Notice of Motions are bought forward to Council by Councillors after correspondence from the community. The time frame in getting reports back and not getting reports back impacts Councillor relationships with the community.

 

Setting a policy including time frames for reports to come back and building a register for community transparency will streamline the process for both Councillors and community members. The register will also stop Councillors asking repeatedly in meetings about where their Notice of Motions are up to.

 

Financial Implications

N/A

Policy and Legislation

Wagga Wagga City Council Code of Meeting Practice

 

Link to Strategic Plan

Community Leadership and Collaboration

Objective: We have strong leadership

Outcome: We have leaders that represent us

 

Risk Management Issues for Council

N/A

Internal / External Consultation

N/A

 

 

  


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

NOM-4

 

NOM-4           NOTICE OF MOTION - ACCESS TO GREEN SPACES AT SCHOOLS

Author:          Councillor Dan Hayes

 

Summary:

This Notice of Motion is being presented to Council to call for a report into working with schools and the Department of Education for improving access to green spaces.

 

 

Recommendation

That Council receive a report on developing partnerships with schools and the Department of Education to re-open green spaces at schools that have been fenced off, in particular Kooringal High School and Mount Austin High School.

 

Report

Schools are the heart of our communities, whether in villages or suburbs. It has then been unfortunate that in recent times the Department of Education has removed access to green spaces by fencing off the school ovals. Despite the Department of Education voicing their desire to work in partnerships with local councils as shown with the new Estella School, they have removed significant amounts of open play space for many in our community.

 

Developing options to re-open access to these open spaces will provide a benefit for the community members residing in these areas, and further connect them to the schools.

 

Financial Implications

N/A

Policy and Legislation

Wagga Wagga City Council Code of Meeting Practice

 

Link to Strategic Plan

Community Place and Identity

Objective: We have opportunities to connect with others

Outcome: We activate our community spaces to promote connectedness

 

Risk Management Issues for Council

N/A

Internal / External Consultation

N/A

 

 

  


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

NOM-5

 

NOM-5           NOTICE OF MOTION - PEDESTRIAN CROSSING ON LAKE ALBERT ROAD

Author:          Councillor Dan Hayes

 

Summary:

This notice of motion is being presented to Council to call for a report into the parking pedestrian crossing on Lake Albert Road to improve its safety.

 

 

Recommendation

That Council receives a report exploring options to improve pedestrian safety on the Lake Albert Road pedestrian crossing at Sacred Heart Primary School during hours outside of the school zone times.

 

Report

Residents have raised concerns that the pedestrian crossing is dangerous outside of school zones. While different theories have been opined, it is most likely a combination of reasons, such as sight distances, the four lanes of traffic, drivers and pedestrians unsure if the crossing is operational outside of school hours and others.

 

There has also been a significant increase in traffic over time along the road. It is time that council re-examines the options for this crossing and make recommendations of any improvements if suitable.

 

Financial Implications

N/A

Policy and Legislation

N/A

 

Link to Strategic Plan

Safe and Healthy Community

Objective: We are safe

Outcome: We create safe spaces and places

 

Risk Management Issues for Council

N/A

Internal / External Consultation

N/A

 

 


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

RP-1

 

Reports from Staff

RP-1               DA19/0603 - ALTERATIONS AND ADDITIONS INCLUDING REAR EXTENSION AND GARAGE AT 93 BEST STREET, WAGGA WAGGA, LOT 17 SECTION 49 DP 759031

Author:                        Sam Robins 

General Manager:    Peter Thompson

         

 

Summary:

This report is for a development application and is presented to Council for determination. The application was deferred at the Council meeting of 16 March 2020 pending the outcome of Development Control Plan (DCP) amendments. Given the timeframe involved the applicant has requested a determination of this application. The application was initially referred to Council at the request of the General Manager.

 

 

Recommendation

That Council approve DA19/0603 for alterations and additions to the dwelling house at 93 Best Street Wagga Wagga NSW 2650, having regards to the draft amendments to the DCP, subject to conditions outlined in the attached optional conditions of consent.

 

 

Development Application Details

 

Applicant

GP Bannon and CE Bannon

Owner

GP Bannon and CP Bannon

Development Cost

$475,000

Development Description

Alterations and additions to a dwelling house including rear extension and garage.

 

Report

At the Council Meeting of 16 March 2020 Council resolved the following:

 

That Council defer consideration of RP-2 DA19/0603 – Alterations and additions including rear extension and garage at 93 Best Street, Wagga Wagga, Lot 17 Section 49 DP 759031 pending the outcome of the amendment to the DCP as per RP-1 – Management of additions, secondary dwellings and infill development within the Heritage Conservation Area.

 

The draft DCP is currently on exhibition until 19 June 2020 with submissions being received until 3 July 2020 due to the current circumstances surrounding COVID-19. Given the extended time frame before the outcome of the DCP amendment (approximately 4 months before a report can be put back to Council) the applicant has requested a determination of their development application.

 

To assist Councillors in making their decision Council staff have undertaken an assessment of the application against the draft amendments to the DCP including the impact those amendments have on other conclusions made within the original assessment. This can be seen in the attachments.

 

The original assessment is attached with the following identified as key issues. No changes have been made to the original assessment.

 

·        Compliance with the objectives of the Wagga Wagga Local Environmental Plan 2010

·        Compliance with a number of objectives and controls of the Wagga Wagga Development Control Plan 2010

·        Impact on the context and setting

·        Impact on the public interest with regard to precedent and consistency of implementation of community endorsed documents

·

Assessment against existing DCP (Original)

 

This proposal had already been assessed and presented to Council having regard to the Heads of Consideration under Section 4.15(1) of the Environmental Planning and Assessment Act 1979, the provisions of Wagga Wagga Local Environmental Plan 2010 and all relevant Council DCPs, Codes and Policies.

 

Having regard for the information contained in the attached Section 4.15 assessment report (Attachment 1), it was considered that the development is inconsistent with a number of existing objectives and controls of the relevant plans and policies applicable to the development. The assessment also concluded that having regard to the desired future character of the Wagga Wagga Heritage Conservation Area, the impacts of the development are unacceptable with regard to the context and setting, precedent and public interest.

 

If Council chooses to make a determination based off the provisions of the existing DCP, it is recommended that Council refuse the application.

 

 

Assessment against draft amendments to the DCP (New)

 

The assessment of the application against the draft DCP amendments (Attachment 2) concluded that of the 11 reasons for refusal in the original assessment, all would be removed based on the draft amendments and subsequent reassessment of other relevant sections of the report. The conclusion is therefore that this proposal would be recommended for approval if the draft controls were adopted.

 

If Council chooses to make a determination based off the draft amendments to the DCP, it is recommended that Council approve the application subject to the attached optional conditions of consent.


 

Site Location

 

The site, being Lot 17 Section 49 DP 759031, 93 Best Street Central Wagga is located on the eastern side of the Street three lots north of the junction with Forsyth Street.

The site measures 505.80m² and currently contains a detached single storey dwelling with small garden shed in the rear yard.

 

The site is flat and free of any restrictive easements.

 

The locality is a residential area. Consisting in the main of single storey detached dwellings with detached outbuildings to the rear.

 

 

Financial Implications

The decision to refuse the application could potentially be challenged in the Land and Environment Court.

 

Policy

N/A

 

Link to Strategic Plan

The Environment

Objective: We plan for the growth of the city

Outcome: We have sustainable urban development

 

Risk Management Issues for Council

Refusal of the application may result in an appeal process in the Land and Environment Court, which will have to be defended by Council. The reasons for refusal will have to be justified and withstand scrutiny and cross examination in Court.

Internal / External Consultation

Pursuant to this provision of Section 1.10 of the Wagga Wagga Development Control Plan 2010, notification of the application was required. The application was notified to surrounding properties from 27/11/2019 to 11/12/2019 in accordance with the provisions of the DCP. No public submissions were received.

 

 

Mail

Media

Community Engagement

Digital

Rates notices insert

Direct mail

Letterbox drop

Council news story

Council News advert

Media releases

TV/radio advertising

One-on-one meetings

Your Say website

Community meetings

Stakeholder workshops

Drop-in sessions

Surveys and feedback forms

Social media

Email newsletters

Website

Digital advertising

TIER

Consult

 

x

 

x

 

 

x

 

 

 

 

x

 

Involve

 

 

 

 

 

 

 

 

Collaborate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Attachments

 

1.

DA19 0603 -  4.15 Report - Provided under separate cover

 

2.

DA19-0603 - Plans - Provided under separate cover

 

3.

DA19-0603 - Statement of Environmental Effects - Provided under separate cover

 

4.

Site Map -  93 Best St - Provided under separate cover

 

5.

DA19-0603 - Draft DCP Amendment Assessment - Provided under separate cover

 

  


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

RP-2

 

RP-2               RIVERINA JOINT ORGANISATION

Author:          Peter Thompson 

         

 

Summary:

In November 2019 Council endorsed becoming a full member of the Riverina Joint Organisation (RivJO). RivJO and REROC recently completed a review of the operation of both entities. At the April 2020 RIVJO Board Meeting, the Board of RIVJO resolved that following the review the preferred way forward was to cease operating both entities and incorporate a Company Limited by Guarantee to perform the work currently undertaken by REROC and RivJO.

 

 

Recommendation

That Council reaffirm its commitment to the Riverina Joint Organisation (RivJO)

 

Report

Background

 

The REROC Board at its February 2018 meeting resolved to form the Riverina JO (RivJO) and continue the operation of REROC. Council’s preference at the time was for a stand-alone JO as per the resolution from the 26 February 2018 Ordinary Council meeting.

 

The RIVJO was proclaimed in May 2018 with the following member Councils:

 

Bland

Coolamon

Cootamundra-Gundagai

Greater Hume

Junee

Lockhart

Temora

 

 

Wagga Wagga joined the Canberra Region JO (CRJO) as an associate member.

 

On 8 April 2019 Council agreed to discontinue its membership with REROC after receiving feedback from staff that indicated there was little, if any value to Council from its membership. This feedback has been validated, with no impact being realised by Council since that decision.

 

At the 25 November 2019 Council Meeting, Council endorsed becoming a full member of the RivJO.

 

Review of RivJO and REROC

 

In 2019 Morrison Low were engaged by RivJO and REROC to develop an independent report to review the operations of both organisations to determine the most effective and efficient way to deliver the best value to its Member Councils.

 

The report considered and assessed the feasibility of the following 6 structural options:

 

·  Option 1 - two entities - REROC & RivJO

·  Option 2 - RivJO - full time

·  Option 3 - RivJO - part time

·  Option 4 - RivJO - in-kind

·  Option 5 - RivJO - delegation

·  Option 6 - incorporated association and company

 

The outcomes of the report indicated that option 5 (RivJO delegation) and option 4 (RivJO in-kind), were the most suitable. The report also identified that an incorporated structure (option 6) might satisfy the criteria for an operating entity for the group however this would be conditional on the NSW Government recognising the incorporated entity as a partner in the same way the Government recognises Joint Organisations.

 

The State Government implemented Joint Organisations to improve collaboration with local government and provide better outcomes for the communities represented by the JO’s Member Councils. This is the structure implemented and encouraged by the State Government.

 

RivJO Board

 

A sub-committee was established to review the report from Morrison Low. The committee made a recommendation to the Board that the preferred way forward is the creation of a new Regional Organisation structured as a Company Limited by Guarantee. This recommendation was supported by the all the RivJO Board members, except for Wagga Wagga.

 

Wagga Wagga City Council advocated for the Joint Organisation as it is the vehicle which the Government has specifically established by legislation to engage with the Government in relation to regional strategy, regional planning and regional advocacy.  It was respectfully submitted to the members of the RivJO Board that it is better to work with the NSW Government on regional strategy and planning using the engagement model specifically established by the Government for that purpose.

 

Wagga Wagga City Council also spoke against the notion of incorporating a Company Limited by Guarantee to replace the REROC incorporated association given there has been no suggestion by Government that the incorporated association is inappropriate for the operation of the group, that the Company Limited by Guarantee is more onerous in terms of Director duties and compliance and that the usual reasons for transitioning to a corporations law structure do not exist in relation to the operations of REROC or RivJO.

 

Conclusion

 

The operation of Joint Organisations across the State have been challenged by a wide range of issues including cost of operations.  In 2018 Council opposed both the model which operated two entities (REROC and RivJO) and also questioned the proposed budgets which suggested that the two entities would be cheaper to operate in comparison to a single Joint Organisation.

 

In the fullness of time, the operation of the two entities has proven to be far more RivJO than predicted and ultimately all the Councils which joined the REROC and RivJO model have decided a single entity is a better solution.

 

Unfortunately, the RivJO Board have resolved that the preferable way forward is to incorporate another entity and transition the activities of both RivJO and REROC to that entity being a Company Limited by Guarantee. As noted earlier, the activities of REROC offer little or no value to Wagga and for this reason alone a move by Wagga Wagga to be a member of a Company Limited by Guarantee is not recommended.

 

Such a move would require the consent of the Minister for Local Government which would seem unlikely given the Government has established the legislation for Joint Organisations to perform this function.

 

It is recommended that Council does not endorse the resolution of the RivJO Board and that Council confirm the decision to participate as a member of RivJO.

Financial Implications

The 2019/20 membership fee is $5,000, but RIVJO are still finalising the fee for 2020/21. Council has $62,576 allocated in the 2020/21 budget for the RIVJO but it should be noted that this funding source was also identified for the Wagga Wagga Business Chamber (WWBC) contribution. Due to the timing of the WWBC decision, only $32,500 was required this financial year and the remaining amounts will be carried over to next financial year.

Policy and Legislation

Local Government Act 1993

 

Link to Strategic Plan

Community Leadership and Collaboration

Objective: We have strong leadership

Outcome: We plan long term

 

Risk Management Issues for Council

N/A

Internal / External Consultation

Discussions with various stakeholders have occurred over a long period of time. A Councillor Workshop was held on 4 May 2020.

 

 

  


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

RP-3

 

RP-3               Integrated Planning and Reporting - Draft Long Term Financial Plan 2021/30 and Combined Delivery Program and Operational Plan 2020/21

Author:         Carolyn Rodney 

Director:       Natalie Te Pohe

         

 

Summary:

Council has drafted the attached Combined Delivery Program and Operational Plan 2020/21, the Draft Fees and Charges 2020/21 and the draft Long-Term Financial Plan 2021/30 for public exhibition. Council’s initial draft 2020/21 budget was balanced, but is now currently forecasting a deficit of around $4.4M.

 

There is a lot of uncertainty in relation to COVID-19 and the impact it will have on Council’s budget. The approach Council is currently taking is to continue to provide essential services to the community while looking for alternative revenue sources and refining the budget as more accurate information comes to hand.

 

Council is still committed to delivering a significant capital works program to cater for the growth of this city, with over $94 million worth of works scheduled, (noting this will be further refined during the exhibition period to take into account works in progress and carry-overs).

 

 

Recommendation

That Council:

a       place the following documents on public exhibition for 28 days commencing 26 May 2020 and concluding on 23 June 2020:

i         draft Combined Delivery Program and Operational Plan 2020/21

ii        draft Fees and Charges for the financial year 2020/21

iii       draft Long-Term Financial Plan 2021/30

b       invite submissions from the community in relation to these documents throughout the exhibition period

c        review the timing of the draft capital works program during the exhibition period

d       receive a further report after the public exhibition period

i         addressing any submissions made in respect of the draft documents

ii        proposing adoption of the draft Combined Delivery Program and Operational Plan 2020/21, draft Fees and Charges 2020/21 and the draft Long-Term Financial Plan 2021/30 including revised timing of capital works program

e       defer the review of financial assistance to community organisations which was to take effect from 2020/21 financial year

f        approve the continued use of the 2019/20 Fees and Charges until the 2020/21 Fees and Charges are adopted by Council, following the public exhibition period

 


 

Report

The Long-Term Financial Plan 2021/30 and the Combined Delivery Program and Operational Plan 2020/21 have been formulated together with consideration to the Wagga View Community Strategic Plan 2040 previously endorsed by Council as well as the Disability Inclusion Action Plan 2017/21.

 

These documents have been created as part of Council’s Sustainable Future Framework, based on the local government requirements for Integrated Planning and reporting.

Sustainable Future Framework

 

 

Combined Delivery Program and Operational Plan

 

The Draft Combined Delivery Program and Operational Plan 2020/21 has been designed to include Council’s commitment to the Wagga View Community Strategic Plan 2040 in the form of the Delivery Program and a Operational Plan inclusive of projects, programs and services to be delivered during the 2020/21 financial year.

 


 

The 2020/21 Combined Delivery Program and Operational Plan consist of:

 

·    Clear links to ‘Wagga View” the Community Strategic Plan 2040

·    Disability Inclusion Action Plan items for 2019/20

·    Delivery Program items

·    Operational items broken down by service areas

·    Outputs of each service area

·    Measures of performance

·    Delivery Program four-year budget

·    Delivery Program Capital Works (New Projects and Recurrent)

·    A list of contributions and donations to be made by Council

 

In the interest of better informing the community, the Operational Plan element of the documents has been broken down by service areas displaying budgeted revenue and expenses, number of employees, details of services carried out by the area as well as relevant performance measures.

 

The Operational Plan has taken into consideration the potential impacts of COVID-19 with the main changes being to performance measures related to the delivery of programs and events as well as visitation and usage of Council facilities. Whilst COVID-19 has had impacts on some services, Council remains committed to maintaining service levels when the operation of facilities and delivery of programs and service are able to resume.

 

Fees and Charges

 

In accordance with Section 608 of the Local Government Act 1993, a council may charge and recover an approved fee for any service it provides.

 

The services for which an approved fee may be charged include the following provided under the Local Government Act or any other Act or the regulations, by the council:

·    supplying a service, product or commodity

·    giving information

·    providing a service in connection with the exercise of the council’s regulatory functions-including receiving an application for approval, granting an approval, making an inspection and issuing a certificate

·    allowing admission to any building or enclosure.

 

There has been a proposed freeze imposed on entry fees and membership fees at the Oasis for 2020/21.

 

As a result of the extension of time for Council to adopted its Combined Delivery Program and Operational Plan for 2020/21 until the end of July 2020, Council is required to continue using its previously adopted fees and charges for 2019/20 until such time as the 2020/21 Fees and Charges are adopted by Council, following the public exhibition period. As the 2019/20 fees will only be in place a month before resetting to the 2020/21 proposed amounts, the likely financial impact is minimal.

 

Long Term Financial Plan

 

The Long Term Financial Plan is an essential element of the resourcing strategy which details how the strategic aspirations of Council which are outlined in the Community Strategic Plan can be achieved in terms of time, money, assets and people.

 

Council’s Long Term Financial Plan is a ten-year financial planning document with an emphasis on long-term financial sustainability. Financial sustainability is one of the key issues facing local government due to several contributing factors including growing demands for community services and facilities, constrained revenue growth and ageing infrastructure.

 

The Long Term Financial Plan is formulated by using a number of estimates and assumptions to project the future revenue and expenditure required by Council to deliver those services and projects expected by the community. In doing so, it addresses the resources that impact on the Council’s ability to fund its services and capital works whilst remaining financially sustainable.

 

This iteration of the Long Term Financial Plan also provides an indication of the likely financial impact from the COVID-19 pandemic on Council’s 2020/21 financial year budget. The initial balanced budget position has now been adjusted to include a forecast deficit position as a result of these changes which are shown in Table 1.

 

As per resolution 18/304 Report RP-8 ‘Review of Current Financial Assistance provided to Community Organisations, Businesses, and Individuals’ presented to Council 27 August 2018, a detailed review of the current level of financial assistance provided to the community including appropriate eligibility criteria for a new financial assistance application process was to commence from 1 July 2020. Due to the impact from COVID-19, the review of the financial assistance to community organisations which was to take effect from the 2020/21 financial year will now be deferred to 2021/22.

 

Capital Works Program

 

Capital works projects and programs account for over $94 million of the planned activities for the 2020/21 financial year. There are three different categories of capital works; new, recurrent and potential. New capital projects refer to the one-off projects Council will undertake during the year. Recurrent capital projects refer to the expenditure allocated on an annual basis for capital works programs. The Potential capital projects are those that still require a resolution of Council to proceed and have therefore been excluded from the 2020/21 Delivery Program.

 

At the 24 February 2020 Council Meeting Councillors endorsed a Capital Works Program for 2020/21, including adjustments to the 2021/30 Long Term Financial Plan. Further meetings with project managers are currently underway to ensure that the program finally adopted for 2020/21 reflects all new and continuing projects.

 

Major Projects

 

Included in Council’s draft 2021/30 Long Term Financial Plan Capital Works Program are the following significant projects:

 

Project

Estimated Year(s) of construction

Estimated Total Cost

Levee Bank System Upgrades

2017/18 – 2022/23

$23.3M

Airport Taxiways Upgrade

2019/20

$5.7M

Eunony Bridge Road Bridge Replacement

2019/20 + 2020/21

$10.6M

Active Travel Plan

2019/20 - 2021/22

$13.2M

Riverside – Wagga Beach Landscape Upgrade Stage 2

2019/20 - 2021/22

$7.0M

Pomingalarna Multisport Cycling Complex

2019/20 - 2021/22

$9.2M

Farrer Road Improvements

2018/19 + 2019/20

$6.5M

Dunns Road Upgrade

2020/21

$8.3M

RIFL Stage 2 (Rail Siding)

RIFL Stage 3 (Industrial Subdivision Civil Works)

2019/20 + 2020/21

2020/21 + 2021/22

$14.4M

$27.8M

 

These works highlight Council’s commitment to getting on with the job and delivering critical infrastructure to cater for the future growth of this city.

 

COVID-19                                                                                                                          

 

Whilst Council will continue to support the community where they can with potential fee waivers and fee reductions, Council still has a financial responsibility for the long-term sustainability of the organisation. With the reduction of services and the closure of some Council businesses and facilities, this will continue to have a substantial impact on Council’s operational budgets. The estimated financial impact is detailed in Table 1.

 

Table 1 – Estimated Financial Impacts of COVID-19

 

Function / Facility Impacted

2020/21 Estimated

Budgeted Net Impact

Investment Income

($259,000)

Airport

($3,027,079)

Development Income

($1,070,778)

Oasis Aquatic Centre

($106,412)

Car Parking Patrols

($114,530)

Parks and Sportsgrounds Fees and Charges

($109,719)

Civic Theatre

($59,210)

Other Council owned closed facilities

($72,415)

Environmental Health Fees and Charges

($43,260)

Commercial Lease income

($52,500)

Community Lease income

($10,827)

Savings in Buildings operational Costs

$91,147

Estimated Financial Impact due to COVID-19

($4,834,583)

Total Partial Funding Sources identified

$436,243

Estimated Total Financial Impact due to COVID-19, considering partial funding sources identified

($4,398,340)

 


 

Financial Implications

The proposed adoption of the suite of IPR documents will be reported to Council 27 July 2020 after all submissions have been addressed.

 

It is important that Council recognise the deficit position, not only as a result of COVID‑19 impacts on the 2020/21 financial year, but the already projected deficit positions from 2021/22 to 2029/30 highlight the significant issues that Council has been facing due to the unfavourable adjustments to revenue sources (Financial Assistance Grants and Rate Pegging restrictions) in previous financial years. This has resulted in the requirement to increase the use of borrowings to fund projects, with significant loan repayments for the future 10 years of the plan.

 

These unprecedented times will mean that Council faces its greatest challenge in 2020/21 to remain financially sustainable and reduce the estimated proposed $4.4M deficit. Due to the uncertainty of so many factors in relation to this unfolding pandemic, as further information comes to hand, extensive ongoing financial management will continue with regular Councillor Workshops and reports being presented to Council on an ongoing basis. These workshops and reports will include financial modelling for 2020/21 and the following years, with budgets adjusted accordingly after Council resolutions.

 

The Long Term Financial Plan once adopted will then inform the 2020/21 budget and ongoing for 10 years.

Policy and Legislation

The documents have been created to meet Council’s Integrated Planning and Reporting requirements under the Local Government Act 1993 and Local Government Regulations 2005.

 

Link to Strategic Plan

Community Leadership and Collaboration

Objective: We have strong leadership

Outcome: We plan long term

 

Risk Management Issues for Council

A number of risk management issues were identified and have been actively managed.

 

A summary of these risks are as follows:

-        Lack of engagement from the community

-        Inability to meet everyone’s expectations

-        Inability to resource and deliver on plans

 

With Council not receiving some budgeted revenue and forecasting a significant deficit, this places immense financial pressure on Council delivering required services to the community with the risk of not meeting the needs of the community as a whole. This may include (but is not limited to) diverting funds from previously provided Council services to other areas that may be deemed of a higher need due to COVID-19.

 

Internal / External Consultation

The documents will be placed on public exhibition for a 28-day period commencing from 26 May 2020 and concluding on 23 June 2020. As part of the exhibition period a variety of communication methods will be used, to not only promote the public exhibition period but also promote the purpose of the documents.

 

The deficit position of Council will require regular Councillor workshops and reports to be presented to Council on an ongoing basis. Not only will there be regular updates as part of the monthly financial performance report associated with 2020/21, but there will be a need for additional financial modelling for the following financial years in order to reign in the deficit.

 

 

Mail

Media

Community Engagement

Digital

Rates notices insert

Direct mail

Letterbox drop

Council news

Media releases

Print advertising

TV/radio advertising

One-on-one meetings

Your Say website

Community meetings

Stakeholder workshops

Drop-in sessions

Surveys and feedback forms

Social media

Email newsletters

Website

Digital advertising

TIER

Consult

 

 

 

x

x

 

 

x

 

 

 

 

x

 

x

 

Involve

 

 

 

 

 

 

 

 

Collaborate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Attachments

 

1.

2021/30 Draft Long Term Financial Plan - Provided under separate cover

 

2.

2020/21 Draft Combined Delivery Program and Operational Plan - Provided under separate cover

 

3.

2020/21 Draft Fees and Charges - Provided under separate cover

 

  


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

RP-4

 

RP-4               Indicative Financial Impact of COVID-19 on Council's 2019/20 Budget

Author:         Carolyn Rodney 

Director:       Natalie Te Pohe

         

 

Summary:

This report provides Councillors with indicative financial impact information for Council’s 2019/20 budget. Any update to the information provided in this report will be provided to Councillors through further Council reports.

 

 

Recommendation

That Council:

a       note the current indicative financial impact compiled by staff of COVID-19 on Council’s 2019/20 Budget

b       will be provided with further updates from staff as the 2019/20 financial year progresses

c        note that the estimated financial impact due to COVID-19 on the 2020/21 budget has been included in the draft Long Term Financial Plan budget

d       will be provided with updates on the financial impact of COVID-19 on the 2020/21 budget as part of the monthly financial performance reporting requirements

 

Report

The World Health Organisation declared COVID-19 a pandemic on 11 March 2020.  As the international response continues to develop, organisations are facing significant financial challenges. Local councils are not immune to these financial challenges. This report provides an indication of the likely financial impact up to 30 June 2020 on Council’s 2019/20 financial year outcome.

 

Council officers are also at this same meeting, proposing for Council to place on public exhibition the draft 2020/21 Long Term Financial Plan (LTFP). The proposed draft 2020/21 budget includes the estimated impacts from COVID-19 which will require extensive financial management, review and adjustments throughout the financial year. This may include (but is not limited to) diverting funds from previously provided Council services to another which is deemed a higher need due to the COVID-19 impacts.

 

The following table shows the indicative financial impact by fund on the 2019/20 financial year budget. These indicative figures assume that the current restrictions due to COVID-19 (as at 14 May 2020) will remain in place for the rest of this financial year (to 30 June 2020).

 

2019/20 Estimated Financial Impact by area due to COVID-19

 

Income

Impact

Expenses

Impact

Net Impact

Investment Income

($597,386)

 

($597,386)

Airport*

($1,241,336)

$356,446

($884,890)

City Planning

($530,919)

 

($530,919)

Oasis

($453,489)

$101,136

($352,353)

Traffic Parking Fines

($148,324)

 

($148,324)

Parks and Sportsground Fees and Charges

($170,014)

 

($170,014)

Civic Theatre

($177,163)

$148,042

($29,121)

Other Closed Facilities

($75,898)

 

($75,898)

Environmental Health and Companion Animals

($49,500)

 

($49,500)

Family Day Care*#

($34,000)

 

($34,000)

Commercial Leases^

($5,235)

 

($5,235)

2019/20 Estimated Financial impact due to COVID-19

($3,483,264)

$605,624

($2,877,640)

* Please note that the Airport and Family Day Care areas are not General Purpose Revenue (GPR) areas, and are funded from their respective Reserves. Excluding these two areas, the Estimated Net GPR Impact due to COVID‑19 is $1,958,750

# Please note that this amount is only COVID-19 related and does not include the impact of any subsequent Council decisions

^ Please note that this amount is as per the report going to this same meeting CONF-6 ‘Tenant Hardship’

 

An extensive review of all of Council’s functions was undertaken to attempt to pair back some of the estimated deficit position, as shown in the below table:

 

2019/20 Estimated Financial impact due to COVID-19

($2,877,640)

    Add bank: funded from Airport Reserve

$884,890

    Add back: funded from Family Day Care Reserve

$34,000

2019/20 Estimated COVID GPR Impact – (Deficit)

($1,958,750)

 

 

Finance/Manager’s Review for GPR savings for remainder of 2019/20 financial year

$217,178

 

 

2019/20 Estimated GPR (Deficit) Position

($1,741,572)

 

 

Financial Implications

Council’s estimated financial impact due to COVID-19 for the remainder of the 2019/20 financial is $2,877,640. With Airport and Family Day Care Reserves funding their portions of the net impacts, along with Finance/Managers proposed adjustments brings the General Purpose Revenue estimated deficit to $1,741,572.

 

It is proposed to fund this deficit once finalised at the end of the 2019/20 financial year from Council’s unrestricted cash balance.

Policy and Legislation

Budget Policy – POL 052

 

Link to Strategic Plan

Community Leadership and Collaboration

Objective: We have strong leadership

Outcome: We are accountable and transparent

 

Risk Management Issues for Council

With Council not receiving budgeted income, this places financial pressure on Council delivering required services to the community and therefore not meeting the needs of the community as a whole.

Internal / External Consultation

Council’s Finance Division have consulted with all Divisional Managers and Executive in modelling the estimated financial impact of COVID-19 on Council’s 2019/20 budget. 

 

 

  


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

RP-5

 

RP-5               Financial Performance Report as at 30 April 2020

Author:         Carolyn Rodney 

Director:       Natalie Te Pohe

         

 

Summary:

This report is for Council to consider and approve the proposed 2019/20 budget variations required to manage the 2019/20 budget and Long Term Financial Plan, and details Council’s external investments and performance as at 30 April 2020.

 

 

Recommendation

That Council:

a       approve the proposed 2019/20 budget variations for the month ended 30 April 2020 and note the proposed deficit budget position as a result of COVID-19 with the impacts from COVID-19 to be presented in a separate report

b       note the Responsible Accounting Officer’s reports, in accordance with the Local Government (General) Regulation 2005 (Part 9 Division 3: Clause 203) that the financial position of Council is satisfactory having regard to the original estimates of income and expenditure and the recommendations made above

c        note the details of the external investments as at 30 April 2020 in accordance with section 625 of the Local Government Act 1993

d       note the impact of COVID-19 on Council’s investment portfolio, as provided by Council’s independent investment advisor

 

Report

Wagga Wagga City Council (Council) forecasts a deficit budget position as at 30 April 2020. Proposed budget variations are detailed in this report for Council’s consideration and adoption.

 

There will be a separate report RP-4 ‘Indicative Financial Impact of COVID-19 on Council’s 2019/20 Budget’ presented to Council at this same meeting providing detailed advice on the indicative financial impact of COVID-19 on Council’s 2019/20 Budget and proposed funding. 

 

Council has experienced a positive monthly investment performance for the month of April when compared to budget ($498,650 up on the monthly budget). This is due mainly to a positive rebound from Council’s Floating Rate Note portfolio and TCorp Long Term Growth fund, as the uncertainty in financial markets continues during the COVID-19 pandemic.

 

 


 

Key Performance Indicators

 

 

OPERATING INCOME

Total operating income is 81% of approved budget (this percentage excludes capital grants and contributions). An adjustment has been made to reflect the levy of rates that occurred at the start of the financial year. Excluding this adjustment, operating income received is 91%. As noted earlier, the indicative financial impact of COVID-19 on Council’s 2019/20 Budget is provided in a separate report at this same meeting.

 

OPERATING EXPENSES

Total operating expenditure is 80% of approved budget and is tracking within budget at this stage of the financial year.

 

CAPITAL INCOME

Total capital income is 35% of approved budget. It is important to note that the actual income from capital is influenced by the timing of the receipt of capital grants and contributions relating to projects. This income also includes the sale of property, plant and equipment.

 

CAPITAL EXPENDITURE

Total capital expenditure including commitments is 65% of approved budget (including ‘Potential Projects’). Excluding ‘Potential Projects’ budgets, the capital expenditure including commitments is 71% of approved budget.

 

 


 

WAGGA WAGGA CITY COUNCIL
STATEMENT OF FINANCIAL PERFORMANCE
1 JULY 2019 TO 30 APRIL 2020

CONSOLIDATED STATEMENT

 

ORIGINAL
BUDGET
2019/20

BUDGET ADJ
2019/20

APPROVED BUDGET
2019/20

YTD ACTUAL   EXCL COMMT'S 2019/20

COMMT'S 2019/20

YTD ACTUAL + COMMT'S
2019/20

YTD % OF BUD

Revenue 

Rates & Annual Charges

(69,736,893)

(63,636)

(69,800,529)

(58,286,208)

0

(58,286,208)

84%

User Charges & Fees

(28,440,057)

232,040

(28,208,017)

(22,530,920)

0

(22,530,920)

80%

Interest & Investment Revenue

(3,774,001)

0

(3,774,001)

(2,620,517)

0

(2,620,517)

69%

Other Revenues

(3,053,633)

(230,242)

(3,283,874)

(3,143,408)

0

(3,143,408)

96%

Operating Grants & Contributions

(14,280,296)

2,870,652

(11,409,645)

(7,965,663)

0

(7,965,663)

70%

Capital Grants & Contributions

(56,263,733)

20,598,248

(35,665,485)

(13,032,225)

0

(13,032,225)

37%

Total Revenue

(175,548,613)

23,407,062

(152,141,551)

(107,578,940)

0

(107,578,940)

71%

 

 

Expenses

 

Employee Benefits & On-Costs

46,012,119

(65,334)

45,946,285

38,235,880

56,509

38,292,389

83%

Borrowing Costs

3,587,823

(264,964)

3,322,860

2,389,677

0

2,389,677

72%

Materials & Contracts

32,357,210

10,685,082

43,042,793

27,158,996

7,541,381

34,700,377

81%

Depreciation & Amortisation

34,843,073

0

34,843,073

29,035,894

0

29,035,894

83%

Other Expenses

13,015,295

198,762

13,214,057

7,841,506

136,161

7,977,667

60%

Total Expenses

129,815,520

10,553,547

140,369,067

104,661,954

7,734,051

112,396,004

80%

 

 

Net Operating (Profit)/Loss

(45,733,093)

33,960,609

(11,772,484)

(2,916,987)

7,734,051

4,817,064

 

 

Net Operating (Profit)/Loss before Capital Grants & Contributions

10,530,640

13,362,361

23,893,001

10,115,238

7,734,051

17,849,289

 

 

 

Capital / Reserve Movements

Capital Exp - Renewals

34,034,738

(385,622)

56,812,538

28,178,476

16,001,278

44,179,754

78%

Capital Exp - New Projects

42,696,132

(17,406,488)

19,169,500

7,449,777

1,701,989

9,151,766

48%

Capital Exp - Project Concepts

38,364,925

(13,800,615)

7,521,033

239,044

78,399

317,442

4%

Loan Repayments

3,380,744

(21,035)

3,359,708

2,825,050

0

2,825,050

84%

New Loan Borrowings

(21,222,532)

1,887,999

(19,334,533)

0

0

0

0%

Sale of Assets

(1,502,910)

(1,745,414)

(3,248,324)

(681,972)

0

(681,972)

21%

Net Movements Reserves

(15,174,931)

(2,489,434)

(17,664,365)

0

0

0

0%

Total Cap/Res Movements

80,576,166

(33,960,609)

46,615,557

38,010,375

17,781,665

55,792,040

 

 

 

ORIGINAL
BUDGET
2019/20

BUDGET ADJ
2019/20

APPROVED BUDGET
2019/20

YTD ACTUAL   EXCL COMMT'S 2019/20

COMMT'S 2019/20

YTD ACTUAL + COMMT'S
2019/20

YTD % OF BUD

Net Result after Depreciation

34,843,073

0

34,843,073

35,093,388

25,515,716

60,609,104

 

 

Add back Depreciation Expense

34,843,073

0

34,843,073

29,035,894

0

29,035,894

83%

 

Cash Budget (Surplus)/Deficit

0

0

0

6,057,494

25,515,716

31,573,210

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 




Revised Budget Result - Surplus/(Deficit)

$’000s

Original 2019/20 Budget Result as adopted by Council

Total Budget Variations approved to date

Budget Variations for April 2020

Estimated 2019/20 Financial impact from COVID-19 (refer to separate report RP-4 ‘Indicative Financial Impact of COVID-19 on Council’s 2019/20 Budget’)

$0

$0

$0

 

($1,742K)

Proposed Revised Budget result for 30 April 2020

($1,742K)

 

The proposed Budget Variations to 30 April 2020 are listed below:

 

Budget Variation

Amount

Funding Source

Net Impact

Fav/ (Unfav)

1 – Community Leadership and Collaboration

 

Installation of Hand Sanitiser Stations

$19K

Workers Compensation Reserve ($19K)

Nil

Funds are required for the installation of hand sanitiser stations and wall mounted hand sanitiser dispensers for when Council re-open to the public due to COVID-19. It is proposed to fund the variation from the Workers Compensation Reserve.

Estimated Completion: 30 June 2020

 

Gender Equity Project

($141K)

Department of Communities and Justices Grant $141K

Nil

Delays were experienced with the commencement of The Domestic Violence (DV) Project 2650 including the timing of recruitment of staff which meant that the grant funds for the project were not spent in the timeframes required. As a result of this, the Department of Communities and Justices and Wagga Women's Health Centre have negotiated a revised timeline and milestones to ensure program delivery is consistent with budget expenditure for the remainder of the contract. This variation has resulted in a reduction in grant income of ($141K) in 2019/20 and an increase of $72K in 2020/21. The Administration and Management Fee that is retained by Council has also been adjusted to reflect an additional charge Council is entitled to retain from these funds of $31K in 2019/20 and $26K in 2020/21 to be utilised for the ‘Enlighten for Equity’ Project.

 

2 – Safe and Healthy Community

 

Wiradjuri Walking Track

$22K

Crown Lands Grant ($12K)

Existing Parks maintenance Budgets ($10K)

Nil

Council has been successful in securing grant funds from Crown Lands for the installation of gravel on a section of the Wiradjuri Walking Track between the river and the southern end of Gobbagombalin Bridge. These works will weatherproof a 690 metre long section of the 2 metre wide trail, requiring 300 tonne of road base compacted using a bobcat and roller. This will complete the rehabilitation of the trail between Moorong Street and the wetlands. It is proposed to fund Councils portion of the project from existing City Presentation and Parks and Recreation Maintenance budgets.

Estimated Completion: 30 June 2020

 

4 – Community Place and Identity

 

Library Air Conditioning & Security Access CLS 1&2

$22K

Existing Library maintenance & operational budgets ($22K)

Nil

Funds are required to upgrade the Air Conditioning in the two Community Learning Space rooms in the Library and to allow external groups access to the rooms outside of library hours (but not access to the library). It is proposed to fund these works from existing Library maintenance and operational budgets.

Estimated Completion: 30 June 2020

 

Art Gallery Display Panels

$40K

Workers Compensation Reserve ($40K)

Nil

The Art Gallery has 16 moveable walls that need replacing due to the manual handling risk they pose to staff and the public due to their weight and age.

Moving of the existing walls is considered a hazardous manual handling task that directly stresses the body and can lead to an injury. It is a high force activity that a worker needs assistance with to complete because a greater force is required to move these walls, resulting in an increased risk of workers sustaining a Musculoskeletal Disorder (MSD).

While the Art Gallery is currently closed due to COVID-19 restrictions, it is proposed to take this opportunity now and complete the works before the Art Gallery is re-opened to the general public.

It is proposed to purchase display panels to eliminate this risk and fund the variation for these works from the Workers Compensation Reserve.

Estimated Completion: 30 June 2020

 

5 – The Environment

 

Tarcutta Truck Stop Lighting - Energy Savings Project

$93K

Internal Loans Reserve ($93K)

Nil

Due to a change in the availability of contractors to undertake the works, it is proposed to bring forward the Tarcutta Truck Stop Lighting Energy Savings Project and transfer it from the Potential Projects List into the Capital Works Delivery Program. The funds are currently allocated in 2020/21 ($10K) and 2021/22 ($83K) and are funded from the Internal Loans Reserve which will be repaid with the future energy savings.

Estimated Completion: 30 June 2020

 

Stormwater Pipe Network Project

$94K

Stormwater Levy Reserve ($94K)

Nil

Additional funds are required to engage a contractor to clean, camera and defect assess Councils stormwater pipelines for an approximate total length of 16.4 kilometres in various locations across the Wagga local government area. This work is essential to support Council’s existing camera van to provide substantive and relevant data for the stormwater revaluation project that is being completed this financial year. It is proposed to fund the variation from the Stormwater Levy Reserve which currently has adequate funds. This will bring the total project budget to $219K.

Estimated Completion: 30 June 2020

 

Oasis Flooring Replacement

$42K

Oasis Building Renewal Reserve ($42K)

Nil

It is proposed to bring forward the replacement of the Oasis Flotex Flooring (Entrance/Office and Pool Hall Carpet) that is currently budgeted for replacement in 2020/21. Due to the Oasis currently being closed, this provides a great opportunity to have the carpet replaced now and avoid major disruptions when replacing the carpet when the Oasis is reopened. The current carpet is 7 years old, in poor condition, and is proposed to be replaced with a suitable commercial grade carpet that is durable, hardwearing, stain resistant and designed for high public foot traffic usage. The funding source for the project is the Oasis Building Renewal Reserve.

Estimated Completion: 30 June 2020

 

Eunony Bridge Road Works

$80K

Heavy Patching ($40K) Pavement Rehab ($40K)

Nil

Funds are required to undertake road improvements on a 150 metre section of Eunony Bridge Road. The works need to be undertaken at the same time as the bridge construction to reduce the impacts on the community due to additional roadworks. It is also more cost effective as the contractors are already onsite and it reduces the reputational risk to Council with what may be perceived as rework. It is proposed to fund the variation from existing Heavy Patching and Pavement Rehab budgets.

Estimated Completion: 30 June 2020

 

Glenoak Reservoir Rehabilitation

$19K

Riverina Water County Council Contribution ($19K)

Nil

It has been requested that Council complete the rehabilitation of the area surrounding the recently completed Glenoak Reservoir with advice received from the Riverina Water County Council (RWCC) for the funding of these works.

Estimated completion: 30 June 2020

 

SURPLUS/(DEFICIT)

$0K


 

Current Restrictions

 

 

RESERVES SUMMARY

30 APRIL 2020

 

CLOSING BALANCE 2018/19

ADOPTED RESERVE TRANSFERS 2019/20

BUDGET VARIATIONS APPROVED UP TO COUNCIL MEETING 27.4.2020

PROPOSED CHANGES for Council Resolution

REVISED BALANCE

 

 

 

 

 

 

Externally Restricted

 

 

 

 

 

Developer Contributions - Section 7.11

(23,836,289)

3,427,074

(5,794,902)

 

(26,204,116)

Developer Contributions - Section 7.12

97,487

(32,500)

134,012

 

198,999

Developer Contributions – S/Water DSP S64

(6,551,347)

2,579,329

(1,276,930)

 

(5,248,947)

Sewer Fund

(31,115,819)

155,636

6,550,087

 

(24,410,096)

Solid Waste

(21,521,767)

2,164,970

(1,836,399)

 

(21,193,196)

Specific Purpose Grants

(4,044,299)

0

4,044,299

 

0

SRV Levee

(3,853,286)

(3,211)

1,708,696

 

(2,147,801)

Stormwater Levy

(3,699,109)

2,758,808

(2,199,103)

93,578

(3,045,826)

Total Externally Restricted

(94,524,428)

11,050,106

1,329,761

93,578

(82,050,983)

 

 

Internally Restricted

 

Airport

(442,321)

(522,440)

(146)

(964,907)

Art Gallery 

(33,971)

(6,865)

0

(40,836)

Ashmont Community Facility

(7,500)

(1,500)

0

(9,000)

Bridge Replacement 

(601,972)

0

(601,972)

CBD Carparking Facilities

(884,968)

110,302

666,796

(107,870)

CCTV 

(84,476)

18,000

0

(66,476)

Cemetery Perpetual 

(107,717)

(133,730)

16,519

(224,928)

Cemetery 

(448,951)

110,164

(47,707)

(386,494)

Civic Theatre Operating 

(125,471)

8,327

20,913

(96,231)

Civic Theatre Technical Infrastructure 

(82,706)

10,000

65,000

(7,706)

Civil Projects 

(155,883)

24,000

(10,133)

(142,016)

Community Amenities 

(76,763)

(214,928)

25,000

(266,691)

Community Works 

(86,412)

(32,217)

63,020

 

(55,609)

Council Election 

(343,408)

(83,163)

0

(426,571)

Economic Development 

(500,000)

(80,000)

90,000

(490,000)

Emergency Events 

(191,160)

(50,000)

90,420

 

(150,740)

Employee Leave Entitlements

(3,585,224)

 

0

 

(3,585,224)

Environmental Conservation 

(115,206)

 

(42,725)

 

(157,931)

Estella Community Centre 

(230,992)

 

0

 

(230,992)

Family Day Care 

(245,192)

93,442

0

 

(151,750)

Fit for the Future

(1,785,102)

266,703

(3,054,537)

 

(4,572,935)

Generic Projects Saving

(816,377)

20,000

31,130

 

(765,248)

Glenfield Community Centre 

(21,704)

(2,000)

0

 

(23,704)

Grants Commission 

(5,256,259)

 

5,256,259

 

0

Grassroots Cricket 

(70,992)

 

0

 

(70,992)

Gravel Pit Restoration 

(797,002)

 

3,546

 

(793,456)


 

 


 

RESERVES SUMMARY

 

30 APRIL 2020

 

CLOSING BALANCE 2018/19

ADOPTED RESERVE TRANSFERS 2019/20

BUDGET VARIATIONS APPROVED UP TO COUNCIL MEETING 27.4.2020

PROPOSED CHANGES for Council Resolution

REVISED BALANCE

Gurwood Street Property 

(50,454)

 

0

 

(50,454)

Hampden Bridge

(107,198)

 

107,198

 

0

Information Services

(775,938)

(222,792)

222,315

 

(776,415)

Infrastructure Replacement 

(335,497)

(30,192)

0

 

(365,689)

Insurance Variations 

(100,246)

 

0

 

(100,246)

Internal Loans 

(660,754)

260,962

(1,910,123)

93,188

(2,216,727)

Lake Albert Improvements 

(28,338)

(21,515)

(158,608)

 

(208,461)

LEP Preparation 

(2,667)

 

0

 

(2,667)

Livestock Marketing Centre 

(3,311,635)

972,792

(2,367,862)

 

(4,706,704)

Museum Acquisitions 

(39,378)

 

0

 

(39,378)

Oasis Building Renewal 

(320,759)

65,000

28,529

42,420

(184,810)

Oasis Plant 

(1,239,132)

857,486

(441,652)

 

(823,298)

Office Equipment/Building Projects

(159,030)

 

156,530

 

(2,500)

Parks & Recreation Projects

(206,102)

30,148

136,954

 

(39,000)

Planning Legals

0

(40,000)

0

 

(40,000)

Plant Replacement 

(3,550,033)

660,253

1,055,919

 

(1,833,861)

Playground Equipment Replacement 

(95,290)

(165,727)

0

 

(261,017)

Project Carryovers 

(2,453,184)

518,327

1,934,858

 

0

Public Art 

(198,922)

30,300

45,594

 

(123,028)

Robertson Oval Redevelopment 

(92,151)

 

0

 

(92,151)

Senior Citizens Centre 

(17,627)

(2,000)

0

 

(19,627)

Sister Cities 

(46,328)

(10,000)

0

 

(56,328)

Sporting Event Attraction

(169,421)

 

110,000

 

(59,421)

Sporting Event Operational

(100,000)

 

0

 

(100,000)

Stormwater Drainage 

(158,242)

(100,000)

50,000

 

(208,242)

Strategic Real Property 

0

 

(395,000)

 

(395,000)

Street Lighting Replacement 

(56,549)

 

43,288

 

(13,261)

Subdivision Tree Planting 

(702,868)

(20,000)

90,000

 

(632,868)

Sustainable Energy 

(527,244)

389,333

(43,545)

 

(181,456)

Unexpended External Loans 

(431,337)

 

36,485

 

(394,852)

Workers Compensation 

(93,251)

 

(133,461)

59,000

(167,712)

Total Internally Restricted

(33,127,305)

2,706,471

1,740,773

194,608

(28,485,454)

 

 

 

 

 

 

Total Restricted

(127,651,734)

13,756,577

3,070,534

288,186

(110,536,437)

 

 

 

 

 

 

Total Unrestricted

(5,725,794)

0

0

0

(5,725,794)

 

 

 

 

 

 

Total Cash, Cash Equivalents and Investments

(133,377,528)

13,756,577

3,070,534

288,186

(116,262,231)

 

 

 

 

 


 

Investment Summary as at 30 April 2020

In accordance with Regulation 212 of the Local Government (General) Regulation 2005, details of Wagga Wagga City Council’s external investments are outlined below:

 

Institution

Rating

Closing Balance
Invested
31/03/2020
$

Closing Balance
Invested
30/04/2020
$

April
EOM
Current Yield
%

April
EOM
% of Portfolio

Investment
Date

Maturity
Date

Term
(mths)

Short Term Deposits

 

 

 

 

 

 

 

 

AMP

BBB+

2,000,000

2,000,000

2.10%

1.49%

2/12/2019

1/06/2020

6

AMP

BBB+

1,000,000

1,000,000

2.00%

0.74%

13/11/2019

11/05/2020

6

AMP

BBB+

1,000,000

1,000,000

2.10%

0.74%

2/12/2019

1/06/2020

6

MyState

BBB

1,000,000

0

0.00%

0.00%

1/04/2019

1/04/2020

12

ICBC

A

1,000,000

1,000,000

1.67%

0.74%

29/08/2019

28/08/2020

12

NAB

AA-

1,000,000

1,000,000

1.70%

0.74%

10/09/2019

11/05/2020

8

Macquarie Bank

A+

1,000,000

1,000,000

1.65%

0.74%

9/03/2020

7/09/2020

6

Total Short Term Deposits

 

8,000,000

7,000,000

1.90%

5.20%

 

 

 

At Call Accounts

 

 

 

 

 

 

 

 

NAB

AA-

601,301

452,738

0.25%

0.34%

N/A

N/A

N/A

CBA

AA-

2,034,801

676,959

0.25%

0.50%

N/A

N/A

N/A

CBA

AA-

17,004,874

9,527,894

1.60%

7.08%

N/A

N/A

N/A

Total At Call Accounts

 

19,640,976

10,657,592

1.46%

7.92%

 

 

 

Medium Term Deposits

 

 

 

 

 

 

 

 

RaboBank

A+

1,000,000

1,000,000

3.16%

0.74%

5/06/2017

6/06/2022

60

BOQ

BBB+

2,000,000

2,000,000

3.10%

1.49%

7/07/2017

7/07/2020

36

Rabobank

A+

1,000,000

1,000,000

3.20%

0.74%

25/08/2016

25/08/2021

60

Westpac

AA-

3,000,000

3,000,000

1.65%

2.23%

10/03/2017

10/03/2022

60

Auswide

BBB

2,000,000

2,000,000

2.95%

1.49%

5/10/2018

6/10/2020

24

BOQ

BBB+

2,000,000

2,000,000

3.35%

1.49%

3/01/2018

4/01/2022

48

Police Credit Union

NR

2,000,000

2,000,000

3.05%

1.49%

29/10/2018

29/10/2020

24

Australian Military Bank

BBB+

1,000,000

1,000,000

2.95%

0.74%

29/05/2018

29/05/2020

24

BOQ

BBB+

1,000,000

1,000,000

3.50%

0.74%

1/06/2018

1/06/2022

48

Westpac

AA-

2,000,000

2,000,000

3.02%

1.49%

28/06/2018

28/06/2021

36

Westpac

AA-

2,000,000

2,000,000

2.88%

1.49%

28/06/2018

29/06/2020

24

ING Bank

A

2,000,000

2,000,000

2.86%

1.49%

16/08/2018

17/08/2020

24

BOQ

BBB+

3,000,000

3,000,000

3.25%

2.23%

28/08/2018

29/08/2022

48

ING Bank

A

3,000,000

3,000,000

2.85%

2.23%

30/08/2018

14/09/2020

24

P&N Bank

BBB

1,000,000

1,000,000

3.10%

0.74%

16/10/2018

18/10/2021

36

Westpac

AA-

2,000,000

2,000,000

3.05%

1.49%

13/11/2018

15/11/2021

36

Police Credit Union

NR

1,000,000

1,000,000

3.07%

0.74%

20/11/2018

20/11/2020

24

P&N Bank

BBB

1,000,000

1,000,000

3.30%

0.74%

20/11/2018

21/11/2022

48

ING Bank

A

2,000,000

2,000,000

2.93%

1.49%

29/11/2018

30/11/2020

24

NAB

AA-

2,000,000

2,000,000

3.01%

1.49%

30/11/2018

30/11/2021

36

Bendigo-Adelaide

BBB+

1,000,000

1,000,000

3.25%

0.74%

30/11/2018

30/11/2022

48

CUA

BBB

2,000,000

2,000,000

3.02%

1.49%

5/12/2018

7/12/2020

24

Newcastle Permanent

BBB

2,000,000

2,000,000

3.05%

1.49%

8/02/2019

8/02/2022

36

ING Bank

A

1,000,000

1,000,000

2.82%

0.74%

22/02/2019

22/02/2021

24

Newcastle Permanent

BBB

2,000,000

2,000,000

2.70%

1.49%

23/04/2019

26/04/2022

36

BoQ

BBB+

1,000,000

1,000,000

2.40%

0.74%

22/05/2019

23/05/2022

36

BoQ

BBB+

1,000,000

1,000,000

2.15%

0.74%

8/07/2019

10/07/2023

48

Judo Bank

NR

1,000,000

1,000,000

2.30%

0.74%

16/07/2019

16/07/2021

24

Auswide

BBB

1,000,000

1,000,000

1.95%

0.74%

12/08/2019

12/08/2022

36

Judo Bank

NR

1,000,000

1,000,000

2.15%

0.74%

20/08/2019

19/08/2021

24

Australian Military Bank

BBB+

1,000,000

1,000,000

1.76%

0.74%

20/08/2019

20/08/2021

24

Judo Bank

NR

1,000,000

1,000,000

1.90%

0.74%

10/09/2019

9/09/2022

36

Auswide

BBB

1,000,000

1,000,000

1.72%

0.74%

3/10/2019

4/10/2022

36

ICBC

A

2,000,000

2,000,000

2.03%

1.49%

6/11/2019

6/11/2024

60

ICBC

A

2,000,000

2,000,000

1.83%

1.49%

28/11/2019

28/11/2024

60

Judo Bank

NR

1,000,000

1,000,000

2.20%

0.74%

5/12/2019

3/12/2021

24

ICBC

A

1,000,000

1,000,000

1.75%

0.74%

6/01/2020

8/01/2024

48

BOQ

BBB+

1,000,000

1,000,000

2.00%

0.74%

28/02/2020

28/02/2025

60

ING Bank

A

2,000,000

2,000,000

1.50%

1.49%

2/03/2020

2/03/2022

24

Macquarie Bank

A+

2,000,000

2,000,000

1.40%

1.49%

9/03/2020

9/03/2022

24

Police Credit Union

NR

0

1,000,000

2.20%

0.74%

1/04/2020

1/04/2025

60

Total Medium Term Deposits

 

63,000,000

64,000,000

2.62%

47.55%

 

 

 

Floating Rate Notes - Senior Debt

 

 

 

 

 

 

 

 

AMP

BBB+

1,002,668

1,005,757

BBSW + 135

0.75%

24/05/2016

24/05/2021

60

Suncorp-Metway

A+

1,001,515

1,007,468

BBSW + 97

0.75%

16/08/2017

16/08/2022

60

Bendigo-Adelaide

BBB+

498,912

500,054

BBSW + 105

0.37%

25/01/2018

25/01/2023

60

Newcastle Permanent

BBB

1,507,412

1,514,180

BBSW + 140

1.12%

6/02/2018

6/02/2023

60

Westpac

AA-

1,991,697

2,016,048

BBSW + 83

1.50%

6/03/2018

6/03/2023

60

UBS

A+

2,000,138

1,999,487

BBSW + 90

1.49%

8/03/2018

8/03/2023

60

Heritage Bank

BBB+

1,402,747

1,406,993

BBSW + 123

1.05%

29/03/2018

29/03/2021

36

ME Bank

BBB

1,610,084

1,605,476

BBSW + 127

1.19%

17/04/2018

16/04/2021

36

ANZ

AA-

1,997,684

2,022,557

BBSW + 90

1.50%

9/05/2018

9/05/2023

60

NAB

AA-

1,997,722

2,022,249

BBSW + 90

1.50%

16/05/2018

16/05/2023

60

CBA

AA-

1,996,854

2,024,811

BBSW + 93

1.50%

16/08/2018

16/08/2023

60

Bank Australia

BBB

753,953

756,652

BBSW + 130

0.56%

30/08/2018

30/08/2021

36

CUA

BBB

602,644

604,757

BBSW + 125

0.45%

6/09/2018

6/09/2021

36

AMP

BBB+

1,495,373

1,500,688

BBSW + 108

1.11%

10/09/2018

10/09/2021

36

NAB

AA-

1,990,559

2,019,360

BBSW + 93

1.50%

26/09/2018

26/09/2023

60

Bendigo-Adelaide

BBB+

1,003,012

1,002,485

BBSW + 101

0.74%

19/10/2018

19/01/2022

39

CBA

AA-

3,015,288

3,046,140

BBSW + 113

2.26%

11/01/2019

11/01/2024

60

Westpac

AA-

3,010,485

3,045,608

BBSW + 114

2.26%

24/01/2019

24/04/2024

63

ANZ

AA-

2,505,504

2,543,956

BBSW + 110

1.89%

8/02/2019

8/02/2024

60

NAB

AA-

1,998,177

2,029,567

BBSW + 104

1.51%

26/02/2019

26/02/2024

60

Bank of China Australia

A

1,496,188

1,487,019

BBSW + 100

1.10%

17/04/2019

17/10/2022

42

Westpac

AA-

2,473,267

2,521,235

BBSW + 88

1.87%

16/05/2019

16/08/2024

63

Suncorp-Metway

A+

1,231,837

1,238,684

BBSW + 78

0.92%

30/07/2019

30/07/2024

60

ANZ

AA-

1,968,443

2,006,372

BBSW + 77

1.49%

29/08/2019

29/08/2024

60

HSBC

AA-

2,441,988

2,456,548

BBSW + 83

1.83%

27/09/2019

27/09/2024

60

Bank Australia

BBB

1,483,516

1,491,072

BBSW + 90

1.11%

2/12/2019

2/12/2022

36

ANZ

AA-

1,471,869

1,498,264

BBSW + 76

1.11%

16/01/2020

16/01/2025

60

NAB

AA-

1,962,968

1,998,277

BBSW + 77

1.48%

21/01/2020

21/01/2025

60

Newcastle Permanent

BBB

1,084,532

1,089,906

BBSW + 112

0.81%

4/02/2020

4/02/2025

60

Macquarie Bank

A+

1,948,743

1,989,490

BBSW + 84

1.48%

12/02/2020

12/02/2025

60

Total Floating Rate Notes - Senior Debt

 

50,945,778

51,451,162

 

38.22%

 

 

 

Managed Funds

 

 

 

 

 

 

 

 

NSW Tcorp

NR

1,449,575

1,496,221

3.22%

1.11%

17/03/2014

1/04/2025

132

Total Managed Funds

 

1,449,575

1,496,221

3.22%

1.11%

 

 

 

TOTAL CASH ASSETS, CASH
EQUIVALENTS & INVESTMENTS

 

143,036,329

134,604,974

 

100.00%

 

 

 

LESS: RIVERINA REGIONAL LIBRARY (RRL) CASH AT BANK

 

3,685,861

3,512,080

 

 

 

 

 

TOTAL WWCC CASH ASSETS, CASH
EQUIVALENTS & INVESTMENTS

 

139,350,468

131,092,895

 

 

 

 

 

 

Council’s investment portfolio is dominated by Term Deposits, equating to approximately 53% of the portfolio across a broad range of counterparties. Cash equates to 8%, with Floating Rate Notes (FRNs) around 38% and growth funds around 1% of the portfolio.

 

 

Council’s investment portfolio is well diversified in complying assets across the entire credit spectrum. It is also well diversified from a rating perspective. Credit quality is diversified and is predominately invested amongst the investment grade Authorised Deposit-Taking Institutions (ADIs) (being BBB- or higher), with a smaller allocation to unrated ADIs.

 

 

All investments are within the defined Policy limits except for the “BBB” rated category. Over the month of April, Councils overall total portfolio balance has reduced significantly, down from $143.0M to $134.6M, which has attributed to the slight overweight position. This is due to a large value of contract payments being made in the latter parts of the month, whilst Council waits on grant funding to be received for these projects.

 

Overall, these movements have resulted in a marginal over exposure of 0.56%, or $750K, in this category at 30 April 2020. It should be noted that Council has term deposits maturing with AMP Bank (BBB+) and Australian Military Bank (BBB+) during May. With these maturities and the receipt of outstanding grant funds, this overweight position should be rectified by 31 May 2020.

 

Council’s credit quality limits are outlined in the below table and Rating Allocation chart.

 

 

 

 

Investment Portfolio Balance

 

Council’s investment portfolio balance has decreased significantly from the previous month’s balance, down from $139.4M to $131.1M. This is due to a number of large contractor payments being made during April, with Council either waiting on receiving grant funding payments or external loan borrowings for these projects.

 

 

Monthly Investment Movements

 

Redemptions/Sales – Council redeemed/sold the following investment securities during April 2020:

 

Institution and Type

Amount

Investment

Term

Interest

Rate

Comments

MyState Bank Term Deposit

$1M

12 months

2.75%

This term deposit was redeemed on maturity and funds were reinvested into a new 5-yr Police Credit Union term deposit (see below).

 

New Investments – Council purchased the following investment securities during April 2020:

 

Institution and Type

Amount

Investment

Term

Interest

Rate

Comments

Police Credit Union Term Deposit

$1M

5 years

2.20%

The Police Credit Union rate of 2.20% compared favourably to the rest of the market for this investment term.

 

Rollovers – Council did not rollover any investment securities during April 2020.

 

Monthly Investment Performance

 

Interest/growth/capital gains/(losses) for the month totalled $796,900, which compares favourably with the budget for the period of $298,250 - outperforming budget for the month by $498,650.

 

Council’s outperformance to budget for April was mainly due to a positive rebound in the principal value of its Floating Rate Note (FRN) portfolio. During the month, the principal value of Council’s FRN portfolio increased by $506,686 (or 1.00%) as trading margins on these securities tightened – recovering a large portion of the $758,917 in principal value lost during March. The movement in the trading margins on these securities can be seen in the below table.

 

It is still worth noting that these investment securities are senior ranking assets and high in the bank capital structure. It is expected that, if held to maturity, these FRN’s will pay back the original face value of the investment whilst Council still receives its quarterly interest payments. Therefore, it is not expected that Council will lose any capital or interest payments from its current holdings within its FRN portfolio.

 

Council’s TCorp Long Term Growth fund (LTGF) also experienced a positive return for April, with the fund returning 3.22% (or $46,646) as both domestic and international shares rebounded strongly on the back of stimulus packages being provided by Federal governments, with global and domestic shares returning 10.71% and 8.78% respectively.

 

 

As can be seen in the above graph, Council’s interest on investments has taken a significant hit during the COVID-19 pandemic and given the continued uncertainty in financial markets, Council will likely continue to feel this impact indefinitely. Attached to this report is some insight into the impacts of COVID-19 on Council’s investment portfolio provided by Council’s independent investment advisor, Imperium Markets.

 

In comparison to the AusBond Bank Bill Index* (1.12%), Council’s investment portfolio returned 2.40% (annualised) for April – excluding the positive rebound seen for Council’s FRN portfolio. Cash and At-Call accounts returned 1.44% (annualised) for this period. These funds are utilised for daily cash flow management and need to be available to meet operating and contractual payments as they fall due.

 

Over the past year, Councils investment portfolio has returned 2.36%, outperforming the AusBond Bank Bill index by 1.25%.

 

* The AusBond Bank Bill Index is the leading benchmark for the Australian fixed income market. It is interpolated from the RBA Cash rate, 1 month and 3 month Bank Bill Swap rates.

Please note that the above performance table does not take into account the strong positive rebound for Councils FRN portfolio for the month of April. This table of returns only provides for the value of interest payments from the FRN portfolio as Council does not expect to lose any of the capital value of these investments. If Council sells out of an FRN prior to maturity, the capital gain or loss is then included in the return for that month.

Report by Responsible Accounting Officer

I hereby certify that all of the above investments have been made in accordance with the provision of Section 625 of the Local Government Act 1993 and the regulations there under, and in accordance with the Investments Policy adopted by Council on 29 April 2019.

 

Carolyn Rodney

Responsible Accounting Officer

Policy and Legislation

Budget variations are reported in accordance with Council’s POL 052 Budget Policy.

 

Investments are reported in accordance with Council’s POL 075 Investment Policy.

 

Local Government Act 1993

Section 625 - How may councils invest?

 

Local Government (General) Regulation 2005

Section 212 - Reports on council investments

 

Link to Strategic Plan

Community Leadership and Collaboration

Objective: We have strong leadership

Outcome: We are accountable and transparent

 

Risk Management Issues for Council

This report is a control mechanism that assists in addressing the following potential risks to Council:

·        Loss of investment income or capital resulting from ongoing management of investments, especially during difficult economic times

·        Failure to demonstrate to the community that its funds are being expended in an efficient and effective manner

Internal / External Consultation

All relevant areas within the Council have consulted with the Finance Division in relation to the budget variations listed in this report.

 

The Finance Division has consulted with relevant external parties to confirm Council’s investment portfolio balances.

 


 

Attachments

 

1.

Imperium Markets Insight - Impacts of COVID-19

 

  


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

RP-5

 


Report submitted to the Ordinary Meeting of Council on Monday 25 May 2020

RP-6

 

RP-6               Temporary Amendments to Council's Financial Hardship Policy - POL 102 and Debt Management Policy - POL 017

Author:         Natalie Te Pohe 

         

 

Summary:

For Councillors to consider temporarily amending the operating provisions of Council’s Financial Hardship Policy POL102 to allow for a wider application and an easier process for ratepayers to apply as a result of the COVID-19 pandemic, along with suspending some of the debt recovery actions usually undertaken in accordance with Council’s Debt Management Policy POL017.

 

 

Recommendation

That Council:

a       note the considerable current and future financial impact the community is facing in light of the COVID-19 pandemic

b       approve the proposed temporary amendments to Council’s Financial Hardship Policy POL102 retrospectively from 31 March 2020 to 27 September 2020, being the date that the Government will continue to provide the JobKeeper payments, noting that the temporary amendments will continue to remain until the date the Australian Government determines for JobKeeper payments

c        note the change in the title from Financial Hardship Policy to Financial Hardship – Payment Arrangements and Waiving of Interest Policy

d       approve suspending the debt recovery proceedings outlined in section 2.1.4 and 2.1.5 of Council’s Debt Management Policy POL017, with the exception of entering payment arrangements, for the period 31 March 2020 to 30 June 2020 for any new outstanding amounts, consistent with prior approvals in relation to this matter

e       provide public notice of the proposed amendments to ensure the community is aware of the new provisions

f        implement the amendments to the Policy provisions and if public submissions are received in opposition to the proposed amendments, the matter is to be considered by Council at the next available Council meeting

g       note the financial impact to Council from providing the fee waivers as outlined within this report

 

Report

Council’s Financial Hardship Policy POL102 currently incorporates a range of conditions that apply to all applications. There are two (2) specific conditions within Section 1.5 of the Policy that are proposed to be removed:

 

1.   That the property for which the hardship application applies is the principal place of residency or occupancy of the applicant.; and

2.   That rates payable (net of pensioner concession) must be more than 6% of the gross income of the property owner.

 

The first condition effectively means that only residential ratepayers may apply for hardship, and the second condition is subjective.

 

Within Section 2.1 there are also two (2) general provisions that are proposed to be waived (listed as a and b for ease of explanation):

 

a    Copy of recent bank statements for all accounts

 

b    Details of all income and expenditure (monthly budget analysis)

 

It is proposed that condition 1 is modified to apply to any property owned within the Wagga Wagga local government area. This would therefore allow the Policy to apply to all ratepayers within the LGA and not be restricted to only residential ratepayers. It is also proposed that conditions a and b are waived for any ratepayer that:

i.    Provides suitable evidence of their eligibility for either the JobKeeper or the JobSeeker payment; or

ii.   Provides suitable evidence that their tenant has qualified for a JobKeeper payment; or

iii.  Provides a Statutory Declaration and evidence from an agent, where applicable, that demonstrates their property has become vacant as a result of the COVID‑19 pandemic; or

iv.  Provides suitable evidence that more than a 30% rent reduction has been provided to their tenant.

 

If this evidence cannot be provided, then the general provisions of a and b would still apply.

 

It is also proposed that an additional example be included as a situation that could cause financial hardship being:

·      Pandemic situations (COVID-19 as an example), causing loss of normal income, which renders or rendered the ratepayer unable to meet payments for a specified period.

 

This example ensures transparency in that Council clearly recognises that the pandemic is beyond people’s control.

 

Lessening the requirements within the Policy will allow for an easier application process for all ratepayers, particularly as eligibility for the JobSeeker and JobKeeper Payments are already determined by the Australian Government. It will also lessen the administrative burden on Council staff who would be required to assess each application.

 

Expanding the Policy to all ratepayers has been considered to ensure equity is applied to all community members within the local government area. This will also ensure consistency with the principles outlined in the Debt Management and Hardship Guidelines issues by the Office of Local Government in November 2018.

 

It has been made clear in the revised Policy that the period for application is up to 27 September 2020, but that payment arrangements can be made that extend over a two-year period. This was in response to some feedback where it was interpreted that the payment plans could only extend to 27 September, however this wasn’t the intent. Additional wording has been included in the draft Policy to this effect.

 

Contained within Council’s Debt Management Policy POL017 are a range of debt recovery proceedings identified with an overview of how each are to be applied. These include:

·      Payment Arrangements

·      Commencing Legal Action / Statement of Claim

·      Default Judgment / Post Judgment

·      Sale of Land for Unpaid Rates and Charges

·      Recovery / Legal Proceedings for Sundry Debtor Accounts

 

While Council is still legislatively required to issue rates and charges throughout this period, and communication was developed to promote payment arrangements, it is recognised that any new outstanding amounts may be a result of the impacts of COVID-19, and it would be inappropriate for Council to proceed with legal action.   

 

Financial Implications

As reported to Council on 30 March 2020, the estimated lost income from the waiving of interest on outstanding rates and charges was $16,000 for a four (4) week period. Extending this period to 30 June increases this to approximately $48,000. It is uncertain as to how many commercial ratepayers may make a hardship application, however given the enquiries to date, it is likely that the lost revenue would be higher than originally anticipated given this was only capturing residential ratepayers.

 

At the time of writing this report, Council had received 29 applications (across 31 properties) with 13 of these being businesses and 29 residential. It should be noted that the 4th quarter instalment is not due until 31 May and further applications may be received closer to this date. From initial review of the applications, the predominant requests have sought an arrangement for the 4th quarter instalments.

Policy and Legislation

The following Council Policies are relevant:

·      Financial Hardship Policy POL102

·      Debt Management Policy POL017

 

Link to Strategic Plan

Community Leadership and Collaboration

Objective: We are active community members

Outcome: We recognise we all have a role to play

 

Risk Management Issues for Council

Council currently has a balanced budget for the current financial year, although it is known that there will be an impact given the pandemic. An overview of the impact will be presented to the second meeting in May. Any reduction in income to be received has a negative impact on Council’s bottom line.

Internal / External Consultation

Communication promoting payment arrangements was developed several weeks ago and provided as an insert to the 4th quarter rates instalment notices. Digital media was also developed and promoted through Council’s website and Facebook page. The link can be found here: http://wagga.nsw.gov.au/financialsupport

 

This page will require updating if Council resolve the recommendation as proposed. It will then be further promoted through the Live Local Be Local website given the direct relevance to commercial property owners.

 

Numerous discussions were held with business advocacy groups such as the Wagga Wagga Business Chamber, Committee for Wagga and Women in Business to ascertain the key messages they were receiving from their members, and what additional and reasonable support Council could provide. Engagement was also undertaken with Wagga’s Business Enterprise Centre, the NSW Business Chamber and commercial property owners who had specifically written to Council.

 

While there was an initial call for rate waivers, when stakeholders were provided with an overview of the impacts on Council’s revenue, State Government rate capping and that there had been no support package that assisted Council financially, the opportunity for deferral for up to two years was received positively, and there was less emphasis on waiving rates. It is noted that the NSW Business Chamber continues to advocate to the State Government for additional assistance and relief.

 

Council Officers will continue to work with the community and consider all applications on a case by case basis.