Latest memo from 'Moose' has people talking
IT'S not panic stations yet but Coffs City Council's budget is trending the wrong way warns councillor Paul Amos.
He has outlined his concerns in one of his 'Memorandums from Moose' which he prints and leaves at the counter of his petrol station at The Bailey Centre.
Cr Amos is a firm believer in transparency and publishes the memorandum whenever he sees a number of issues on council's agenda that the public should be made aware of.
"People are very pleased and grateful to be kept in the loop," he said.
Along with financial concerns the recent memorandum covers a range of issues including the leasing of the airport and enterprise park; Woolgoolga and Sawtell pool renovations; the new Cultural and Civic space which he is 'still finding hard to support'; and the bypass.
In relation to council's budget he has warned the deficit is blowing out.
"If we look at our performance before government grants, subsidies and donations we are now expected, this year, to be in deficit to the tune of $4,000,000 ... the original expectation was a $64,000 deficit," the memorandum states.
To make matters worse, he says this position is actually understated given the unexpected 'windfall' in relation to the revaluation of water and sewer assets in 2017.
Cr Amos states the situation can easily be remedied and he doesn't want to alarm anybody.
"It's just a matter of recognising a trend and when you're talking about the scale of council's budget it should be easy to rein it in. Council financials are not that easy to read and unless it's your forte or special interest, trends like this can go unnoticed," he said.
Rather than responding directly to the figures in the memorandum Coffs Harbour City Council has issued a statement outlining the extensive Long Term Financial Planning process associated with the NSW Governments Fit For The Future Local Government Reform process in 2015.
"The council prepared financial estimates extending until 2025, with council achieving net operating surplus in 2020/21," a council representative said.
"For the current 2018/19 financial year, the council, as part of the fit for the future modelling, had forecast a net operating deficit of approximately $6,673,000. The current forecast budget for the 2018/19 financial year has a predicted net operating deficit of approximately $4,146,000. The council is currently approximately $2,527,000 positively ahead of its long term forecasts for the same period."
Council is responsible for in excess of $2.2 billion worth of assets and is required to undertake reviews of the values of these assets on an ongoing basis.
"These reviews can see substantial fluctuations in these values and the associated depreciation of these assets which can have both a positive and negative impact on financial performance. To a large extent these fluctuations are outside the control of the organisation."
In 2016/17 council reviewed its water and sewer assets which had a positive impact on financial performance by reducing depreciation expense by approximately $2.4 million.
"However, the following year when council's building assets were reviewed, the result had a negative impact on our financial position by increasing depreciation expense by approximately $1.2 million.
"The figure quoted in the memorandum is not consistent with the actual changes.
"The Council continues to perform well against its long term financial forecasts and with the strong leadership of elected members and senior leadership is expected to continue toward long term sustainability."