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2014/15City of West Torrens

Adopted budget and annual business plan

C O N T E N T S

Section Contents Page

1. EXECUTIVE SUMMARY 1

Introduction 2 Strategic Fundamentals 2 A Balanced Budget 3 Operational Expenditure 3 Capital Expenditure 4 Rating in 2014/15 4

2. STRATEGIC FUNDAMENTALS 5

Introduction 6 Community Life 6 Natural Environment 6 Built Environment 7 City Prosperity 7 Financial Sustainability 8 Organisational Strength 8 Key Influences 8 Rationale for the Focus on Asset Management and Sustainability 8 Rationale for the Focus on Flood Mitigation 9 Implications for the City of West Torrens 9 Legislative Changes 10 Emerging Financial Issues 10

3. FORWARD ESTIMATES 13

Introduction 14 Forward Capital Expenditure Estimates 14 Forward Revenue Estimates 15 Forward Operational Expenditure Estimates 16 Forward Loan Estimates 17 Loan Repayments 18 Key Financial Indicators 19

C O N T E N T S (cont'd)


4. CAPITAL BUDGET 23

Introduction 24 Environmental Program 25 Recreation Program 26 Transport Program 27 Road Maintenance Program 27 Road Reconstruction Program 28 Other Road Works 28 Footpath Program 29 Land and Buildings 30 Plant, Equipment and Furniture 31 Library Resources 32

5. OPERATIONAL BUDGET 41

Summary 42 Operational Expenditure 42 Notable Cost Containment 43 Employment Costs 44 Income 45 Rate Income 45 Rate Calculation 47 Minimum Rates 47 Rate Movements 47 Rates Comparison with Other Councils 47 Rate Modelling 49 Grant Income 49 General Purpose Grant 50 User Charges 50 Statutory Charges 51 Other Income 52 Loan Program 2014/15 52 Historical Perspective on Loans 52

6. OPERATIONAL BUDGETS BY DIVISION 57

Urban Services Division 58 Strategy and Community Division 63 Corporate and Regulatory Division 68 City Management and Organisational Support Divisions 73

C O N T E N T S (cont'd)


7. RATING 79

Introduction 80Rate in the Dollar 80The Amount of Rates Levied 80Rating Principles 81Alternative Options 81Capital Versus Site Valuation 82Differential Rating 83Without a Minimum Rate 84Application and Impact of the Minimum Rate 84Fixed Charge 84Service Rate or Charge 85Rate Capping 85Postponement of Rates for Seniors 86Rate Rebates and Remissions 87Proposed Rate Model 87

8. SUMMARY FINANCIAL STATEMENTS 89

9091929394

Budgeted Statement of Financial PositionBudgeted Statement of Comprehensive Income Budgeted Cash Flow StatementBudgeted Statement of Changes in Equity Budgeted Financial IndicatorsBudgeted Uniform Presentation of Finances 95

9. TEN YEAR FINANCIAL PLAN 97

Key Assumptions 99Summary - Actual and Projected 101Revenue Projections 103Operational and Maintenance Expenditure Projections 105Capital Expenditure Projections 107

109110111

Forecast Statement of Financial PositionForecast Statement of Comprehensive Income Forecast Financial IndicatorsForecast Uniform Presentation of Finances 112

10. GLOSSARY OF TERMS 113

Executive Summary

Budget and annual business plan Executive Summary

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Introduction

This Budget and Annual Business Plan for 2014/15 is in a form adopted by Council on 10 December 2013. Key aspects of the combined budget and annual business plan include:

An ‘executive summary’ to explain key aspects of the document and a ‘glossary ofterms’;

Strategic fundamentals that underpin the budget, including information fromCouncil’s community plan;

Forward estimates and the ten year financial plan of the Council; A capital budget, including commentary and detailed information on the full capital

works program; Operational budget information, including divisional level commentary, financial

details and information on objectives, key activities, performance measures, budgethighlights and staff numbers;

Information on rates and rate modelling; Summary financial statements, including those specified in Regulation 5 of the Local

Government (Financial Management) Regulations 2011.

The document is based on the divisional structure of the Council and meets all requirements of the Local Government Act 1999 and the Local Government (Financial Management) Regulations 2011.

Strategic Fundamentals

The Towards 2025 Community Plan was adopted in June 2009, and it provides the strategic focus for the budget, annual business plan and long term financial plan of the Council. It has six broad themes, as follows:

Community life; Natural environment; Built environment; City prosperity; Financial sustainability; Organisational strength.

Key influences on this budget and annual business plan of the Council are the themes of financial sustainability and the built environment, in particular:

Sustainability; Asset management; and Stormwater flood mitigation.

These strategic fundamentals provide the basis for forward estimates and Council’s long term financial management plan which show:

An ongoing operating surplus and a positive operating surplus ratio; A projected asset sustainability ratio which is favourable; A manageable level of debt; and Favourable cash and cash reserve projections.

Rate increases over the next ten years (4.0 per cent in 2014/15 and 4.3 per cent thereafter) are projected to address fully Council’s strategic priorities, in particular sustainability, asset management and stormwater flood mitigation.

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A Balanced Budget

Council’s operating statement in the proposed 2014/15 budget projects a surplus from operations of $6,761,785 as follows, based on a 4.0 per cent rate increase:

$ Income 64,188,267 Expenditure 57,426,482

______________

Operating Surplus 6,761,785 ______________

The proposed rate increase is 0.1 per cent lower than projected in last year's budget, and is proposed on the basis of forward estimates and the strategic fundamentals of the Council.

After adjusting for reserve movements, a nominal cash surplus of $79,185 is also projected.

Operational Expenditure

Operational expenditure has increased by $2,251,797 or 4.1 per cent ($2,610,947 or 5.0 per cent in 2013/14), it being noteworthy that:

Employment costs (excluding St Martins) have increased by $973,549 or 5.1 per centover the original budget estimates for 2013/14 ($649,231 or 3.5 per cent last budget),but three proposed new positions account for $240,000 of this increase. This isexplained further later in this commentary under the heading “Employment Costs”.

Water rates and related charges (excluding St Martins) are being increased by$123,840 or 24.2 per cent, reflecting the impact of both increased usage and highertariffs.

Additional costs associated with local government elections in November 2014 of$168,500 are being budgeted.

The cost increase proposed in the budget, excluding the three items above and St Martins which is self-funded, is $1,175,768 or 2.5 per cent, which compares favourably with both the consumer price index (currently 2.9 per cent for Adelaide) and the local government price index (currently 2.5 per cent).

Other notable items include:

Waste disposal and collection costs have been reduced by $60,000 or 1.4 per cent,largely because of expected changes to carbon tax arrangements;

Interest payable (excluding St Martins) is decreasing by $116,524 or 13.9 per centover what was budgeted in 2013/14, reflecting the impact of loans not being takensince September 2012;

Computer hardware costs have fallen by $245,620 or 64.5 per cent following changesto leasing arrangements, but this is offset fully by increased capital budget costs.

Staff numbers have been increased by 2.7 full time equivalents (FTE’s), reflecting the three new positions and a small FTE reduction. FTE numbers were reduced in each of the last two financial years (by 0.9 FTE in 2013/14 and 9.1 FTE in 2012/13).

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Capital Expenditure

Key aspects of the budget include:

The capital budget for 2014/15 totals $20,490,768, with rate funded capitalexpenditure increasing by $1,733,957 or 12.9 per cent to $15,180,909. The increaseincludes a rate funded capital works increase of $1,090,013, or 9.8 per cent, to$12,187,174.

An amount of $2.602 million being committed to drainage and related construction,with $2.027 million budgeted to undertake detailed design / documentation andconstruction of Lockleys catchment drainage (a loan program item).

$2.07 million for the recreation program ($1.965 million in 2013/14), including$780,000 for the ongoing playground upgrade program.

Transport program expenditure, including expenditure on roads and footpaths, isincreasing by $1.284 million or 13.5 per cent to $10.825 million.

An amount of $920,538 for the replacement, remediation and construction offootpaths and pathways ($840,688 in 2013/14).

Rate funded capital expenditure on building works of $1,125,000 ($895,000 in2013/14), as a further commitment toward meeting maintenance and remediationrequirements identified by GHD in an independent assessment of work that neededto be undertaken.

An amount of $2,000,000 as an ongoing contribution to the development ofcommunity hub and related facilities. The amount is being funded from asset sales.

Rate funded expenditure on plant, equipment and furniture has increased to$1,569,950 ($1,125,650 in 2013/14).

Capital works funded from urban local road grants and roads to recovery funds of$1.043 million.

Rating in 2014/15

An overall average rate increase of 4.0 per cent excluding growth is proposed for 2014/15, 0.1 per cent lower than foreshadowed in the forward estimates of last year’s budget. It is not proposed that more of the rate burden be moved to minimum rated and non-residential ratepayers this year, with the following movements recommended:

Residential : Up 4.0%

Non-Residential : Up 4.0%

Minimum Rate : Up 4.0%

Overall Increase : Up 4.0%

Valuation volatility is low again this year, reflecting current economic circumstances, and this will result in much lower rating volatility. Rate rebate and remission policies are in place to assist ratepayers affected by hardship or disproportionate rate increases, and rate postponement for seniors is now mandatory in certain circumstances under Local Government Act provisions.

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Strategic Fundamentals

Budget and annual business plan Strategic Fundamentals

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Introduction

The Towards 2025 Community Plan was adopted in June 2009, and it provides the strategic focus for the budget, annual business plan and long term financial plan of the Council.

The community plan is structured into six broad themes, four community focused and two corporate focused, as follows:

Community life; Natural environment; Built environment; City prosperity; Financial sustainability; Organisational strength.

Community Life

Long term strategies for community life are as follows:

Aspiration: A community that embraces diversity Encourage recognition and celebration of our community's cultural diversity. Facilitate opportunities for people from diverse social backgrounds to come

together. Foster a sense of identity and pride within the West Torrens community.

Aspiration: Healthy and learning communities

Encourage all members of the community to pursue active and creative lifestyles.

Facilitate life-long learning through equitable access to a range of education and training opportunities.

Encourage community awareness of services and resources so they can make informed life choices.

Foster a sense of health and safety within the community.

Aspiration: An engaged community

Encourage the community to become involved in and influence Council's decision making framework.

Natural Environment

Long term strategies for the natural environment are as follows:

Aspiration: Development that encompasses environmental sustainability Encourage new and existing development to incorporate environmentally

sustainable designs and practices.

Aspiration: Reduction of our ecological footprint Facilitate the minimisation of waste production and disposal to landfill. Create opportunities to capture and reuse stormwater.

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Manage current water resources efficiently and utilise alternative water supplies.

Actively respond to the challenges of climate change.

Aspiration: Enhanced natural environment Create green streetscapes and open spaces. Protect and enrich local biodiversity, waterways and the coast.

Built Environment

Long term strategies for the built environment are as follows:

Aspiration: A well-designed built environment Facilitate residential development that meets the demographic and socio-

economic needs and expectations of the community. Promote retail, commercial and industrial activity that is compatible with

neighbouring land uses.

Aspiration: An attractive and functional open space network Facilitate equitable access to open spaces.

Aspiration: Effective stormwater infrastructure Manage the quantity and quality of stormwater flows. Minimise the risk of flooding to existing communities and future

developments.

Aspiration: An interconnected transport system Facilitate the safe and effective movement of people through the city.

City Prosperity

Long term strategies for city prosperity are as follows:

Aspiration: A thriving business environment Support the development and growth of local business. Support education and training pathways. Provide effective and efficient infrastructure to sustain economic growth and

productivity.

Aspiration: A vibrant city Facilitate a vibrant community atmosphere.

Aspiration: Sustainable population growth Promote sustainable population growth, attracting people from diverse

backgrounds.

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Financial Sustainability

Long term strategies for financial sustainability are as follows:

Aspiration: Sustainable financial management Employ sustainable financial management principles.

Aspiration: Proactive asset management Ensure assets are utilised to their optimal capacity and maintained at

acceptable standards.

Organisational Strength

Long term strategies for organisational strength are as follows:

Aspiration: Strong partnerships and linkages Develop strong partnerships and linkages.

Aspiration: Leading governance and administration practices Adopt leading governance and administration practices.

Key Influences

Key influences on the budget and annual business plan of the Council are the themes of financial sustainability and the built environment, in particular:

Sustainability; Asset Management; and Stormwater Flood Mitigation.

Sustainability refers to Council’s ability to manage its finances so it can meet spending commitments, both now and in the future, and ensure future generations of taxpayers do not face an unmanageable bill for services provided to the current generation.

Asset management refers to a systematic, structured approach to the maintenance, upgrade and operation of assets, on a whole of life basis, combining engineering principles with sound business practice and economic rationale, and providing the tools to facilitate a more organised and flexible approach to making decisions necessary to meet community expectations.

Stormwater flood mitigation refers to measures aimed at minimising the impact of floods in the West Torrens' community, including mitigation works associated with Brown Hill and Keswick Creeks.

Rationale for the Focus on Asset Management and Sustainability

Concerns continue to be raised in local government circles about the capacity of councils to be financially sustainable. It has been reported that:

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The financial sustainability of councils is vital to the interests of ratepayers, thecommunity and the state, and is an important pillar of efficient and effective localgovernment;

Not all councils have the types of policies and practices in place that lock-in theirfinancial sustainability;

Not all councils in South Australia are financially sustainable, as evidenced by theirhigh operating deficits and substantial infrastructure renewal and replacementbacklogs;

Unless the spending of unsustainable councils is cut or other governments come tothe rescue, substantial rates increases are inevitable. The current or prospectivefinancial performance and position of councils has been assessed as being notstrong enough to absorb likely future developments and unanticipated financialshocks;

More strategic expenditure decisions by local government – and more rigorousfunding policies – must be pursued by local government.

Being a financially viable and sustainable Council received the strongest of all responses in a budget related Community Panel survey in December 2012 involving 181 respondents.

Rationale for the Focus on Flood Mitigation

The Stormwater Management Plan for the Brown Hill Keswick Creek (BHKC) catchment was approved by the Stormwater Management Authority in February 2013 and then gazetted on 5 March 2013. Based on the current modelling associated with this plan, it is estimated that damages from a 100 year average recurrence interval flood will cost $187 million and affect nearly 7,000 properties in the absence of flood mitigation action being taken.

Cost estimates associated with the flood mitigation required have increased from an initial estimate of $133 million to $160 million, with the City of West Torrens' share now being in the vicinity of $38 million.

There are a number of other flooding risks that exist within the city that are not associated with the BHKC catchment. These are the subject of ongoing assessment, with the implementation of flood mitigation systems intended.

Implications for the City of West Torrens

The key influences of sustainability, asset management and stormwater flood mitigation need to be viewed in terms of the following:

Council has management responsibility for community assets valued at $820 million;

Accumulated depreciation on Council assets totals $269.2 million, being 44.0 percent of all depreciable assets, and it is not funded by specific cash reserves;

West Torrens has asset renewal and maintenance backlogs, most recentlydemonstrated to Council in reports on the condition of Council owned buildings;

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West Torrens Council has significant new capital expenditure needs, particularly inrelation to drainage infrastructure;

The most recent cost estimates associated with the BHKC system mitigation worksare in the region of $160 million;

A capital renewal expenditure spike could occur sometime into the future, possiblyaround the year 2050.

Legislative Changes

Legislative changes followed reports on financial sustainability in local government, and they incorporated the need for councils to:

Address issues of sustainability, and prepare long-term asset and financialmanagement plans;

Prepare annual business plans that report on budget parameters, rating structuresand policies, strategic plans, and Council’s long-term asset and financialmanagement plans;

Report on financial indicators, including indicators of financial sustainability;

Establish Audit Committees, and more rigorous and transparent processes ofinternal review;

Consult with the community on budget and rating proposals prior to budgets beingadopted and rates being declared.

The Local Government (Stormwater Management) Amendment Act 2007 has also passed through the parliament, and it has established a Stormwater Management Authority with responsibilities that include planning and undertaking stormwater management works on behalf of councils.

Emerging Financial Issues

Council has responded strongly to the asset management and sustainability agenda, with work undertaken to revisit and update asset data, including condition assessment information, particularly in relation to infrastructure assets. This work is substantially completed for Council’s road and footpath network, and building assets, with work in progress on drainage and land improvements.

Emerging issues for Council to consider from this and other work undertaken include:

Drainage mitigation, including the need to commit at least $38 million to BHKCdrainage works within the next 15 years;

Projections in the asset management plans of the Council that $107.6 million needsto be committed over the next ten years to road, kerbing and footpath maintenanceand remediation works;

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Projections that up to $25.5 million needs to be committed by Council to buildingmaintenance and remediation works over the next ten years, based on currentproperty holdings;

Community hub and related developments, funded entirely from asset sales,totalling $8.1 million from 2014/15 to the 2016/17 financial year;

Local drainage works, still being assessed by Council’s asset management staff,may require expenditure totalling $80 million over the next 20 years;

The need to commit increasingly to initiatives associated with water management,renewable energy, energy efficiency and reducing carbon emissions.

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Forward Estimates

Budget and annual business plan Forward Estimates

13


Introduction

The strategic fundamentals described in this document provide the basis for the forward estimates and Council’s long term financial plan. They are prepared pursuant to the requirements of the Local Government Act 1999 and the Local Government (Financial Management) Regulations 2011.

Key assumptions made in compiling these forward estimates and Council’s long term financial plan are discussed in this section, along with summary projections and key financial indicators.

Detailed information, including long term financial statements, is provided in the 'Ten Year Financial Plan' section of this document.

Forward Capital Expenditure Estimates

Key assumptions made in relation to capital budget estimates include the following:

$27.548 million is committed to drainage works for the Brown Hill Keswick Creek(BHKC) over a ten year period from the 2014/15 financial year, in addition to $1.714million committed in 2013/14, all of which is to be funded from the loan program.

Council commits to rate funded capital works totalling $107.6 million over a ten yearperiod commencing in 2014/15 to fund road and footpath works identified in theinfrastructure and asset management plans of the Council.

Council commits to rate funded capital works for road construction and other capitalworks, totalling $4.23 million in the 2014/15 budget, and that a level of funding is tobe continued into the future.

Council has rate funded local drainage commitments of $575,000 from the 2014/15financial year, with indexed increases annually thereafter.

Loan funded capital drainage works will be $2.027 million in the 2014/15 budget,and $2.0 million indexed per annum thereafter.

Roads to recovery funding, currently $438,839 per annum, will be continued until2019/20.

Capital expenditure on Council owned buildings, excluding hub and relateddevelopments, will be $1.125 million in the 2014/15 budget, and $1.833 millionindexed per annum thereafter.

Asset sale proceeds of $8.381 million will be received in the 2014/15 financial year,and these proceeds, along with past sales, will be used to fully fund community huband related developments that are planned.

The capital budget for the replacement of plant, furniture and equipment will be$1.57 million in 2014/15, and it has been indexed to cover estimated depreciationlevels into the future.

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Expenditure projections for 2014/15 and each of the next three years based on these assumptions are as follows:

2014/15 2015/16 2016/17 2017/18

$ $ $ $

Rate Funded Infrastructure 11,852,174 11,735,659 14,345,340 15,995,186

Rate Funded Local Drainage 575,000 592,250 610,018 628,318

Loan - Local Drainage 2,027,020 2,000,000 2,020,000 2,040,200

Loan - BHKC 0 2,595,255 2,660,137 2,726,640

Grants - R2R and ULRG 1,042,839 1,060,959 1,079,623 1,098,846

Hub Developments 2,000,000 3,000,000 3,100,000 0

Building Other 1,125,000 1,833,914 2,007,905 2,198,403

Plant, Furniture & Equipment 1,569,950 1,617,049 1,665,560 1,715,527

Library Capital 298,785 307,749 316,981 326,490

Total 20,490,768 24,742,835 27,805,563 26,729,611

Forward Revenue Estimates

Forward revenue estimates have been extrapolated from an assessment of historical revenue movements, and what is expected to arise into the future. Key assumptions include the following:

Council is prepared to increase rate revenue by 4.0 per cent plus growth in 2014/15,then by 4.3 per cent plus growth annually thereafter.

Rate equivalent payments by Adelaide Airport Limited will increase in line with theabove rate increases.

Statutory charges, which include parking, animal management and DevelopmentAct income, will increase by 3.0 per cent each year.

User charges, which include resident charges at St Martins, property related incomeand transfer station royalties, will increase by 3.0 per cent each year.

Grant income will increase by 3.0 per cent, with the exception of roads to recoveryfunding by the Commonwealth Government, which is assumed to be at the samelevel until 2019/20.

Other income, including investment income, will increase by 2.7 per cent each yearfrom 2014/15.

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Forward revenue estimates are as follows:

2014/15 2015/16 2016/17 2017/18

$ $ $ $

Rates 44,615,973 47,159,921 49,789,221 52,566,070

Rate Equivalents 4,320,000 4,550,818 4,793,968 5,050,109

Statutory Charges 1,702,260 1,753,328 1,805,928 1,860,105

User Charges 9,080,860 9,353,286 9,633,884 9,922,901

Grant & Subsidies 3,476,139 3,320,058 3,406,495 3,495,524

Other Income 993,035 1,019,076 1,045,842 1,073,354

Total 64,188,267 67,156,486 70,475,337 73,968,064

Forward Operational Expenditure Estimates

Operational expenditure increases have been extrapolated from an assessment of historical cost movements, and what is expected to arise into the future. Key assumptions include:

Employee cost increases of 4.0 per cent each year from 2015/16, with littleallowance for the addition of new staff.

Contract and material expenditure increases of 3.5 per cent each year in support ofCouncil’s maintenance works program, including building and infrastructuremaintenance. This includes an allowance for an increase in waste related charges.

A depreciation expense increase of 3.0 per cent across all asset classes based onprojected asset value movements.

Finance charges largely involve interest repayments on loans taken, and areestimated on the basis of loans projected to be taken using borrowing rates rangingbetween 6.1 and 6.6 per cent.

Forward operational expenditure estimates are as follows:

2014/15 2015/16 2016/17 2017/18

$ $ $ $

Employee Costs 26,231,549 27,280,811 28,372,043 29,506,925

Contractual Services 6,721,025 6,958,466 7,204,463 7,459,329

Materials 929,667 957,557 986,284 1,015,872

Finance Charges 988,050 789,666 926,601 1,272,996

Depreciation 10,479,330 10,802,834 11,136,330 11,480,125

Other Expenses 12,076,861 12,610,526 13,112,013 13,637,345

Total 57,426,482 59,399,861 61,737,734 64,372,592

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Forward Loan Estimates

A loan program of $44.71 million is projected in future dollar terms over the next ten years, as follows:

$m

Local drainage $20.76 BHKC project 25.83 Works overhead (1.89)

------------ Total $44.71

------------

This comprises the following:

Financial Year

Local Drainage

BHKC Drainage

Works Overhead

Total Loans

$ $ $ $

2014/15 2,027,020 0 (184,275) 1,842,745 2015/16 2,000,000 2,595,255 (181,818) 4,413,437 2016/17 2,020,000 2,660,137 (183,636) 4,496,500 2017/18 2,040,200 2,726,640 (185,473) 4,581,367 2018/19 2,060,602 2,794,806 (187,327) 4,668,081 2019/20 2,081,208 2,864,676 (189,201) 4,756,684 2020/21 2,102,020 2,936,293 (191,093) 4,847,221 2021/22 2,123,040 3,009,701 (193,004) 4,939,737 2022/23 2,144,271 3,084,943 (194,934) 5,034,280 2023/24 2,165,713 3,162,067 (196,883) 5,130,897

Total 20,764,075 25,834,518 (1,887,643) 44,710,950

It is anticipated that cash reserves of the Council will be used in lieu of loans being taken in the 2014/15 financial year. The indebtedness trend of the Council is projected on the basis of this information as follows:

0

10

20

30

40

50

$m

Year Ended 30 June

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Council’s indebtedness is projected to peak at $40.9 million under this scenario, then decline thereafter. This scenario will obviously change if loans taken from 2015/16 are other than those currently planned.

Loan Repayments

Loan repayments to service projected loans, based on borrowing rates of 6.1 per cent until 2018/19 and 6.6 per cent thereafter, will be as follows:

Projected Increase/ Year Repayments (Decrease)

$ $

2013/14 2,679,771 230,116 2014/15 2,679,771 0 2015/16 2,679,771 0 2016/17 3,025,777 346,007 2017/18 3,357,179 331,402 2018/19 3,450,527 93,347 2019/20 3,423,830 (26,697) 2020/21 3,912,337 488,507 2021/22 4,426,312 513,975 2022/23 4,582,000 155,688 2023/24 5,115,810 533,810

Council’s current and projected loan program will impact loan repayments most in the 2020/21 to 2023/24 financial years, but these increases are manageable within the framework of the ten year financial plan.

Loan repayments as a percentage of rates is the industry accepted benchmark to assess a Council’s relative indebtedness. The percentages for West Torrens based on the actual and projected loan program are as follows:

Loans %

Year of Rates

2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/222022/23 2023/24

6.3 6.0 5.7 6.1 6.4 6.2 5.8 6.3 6.8 6.6 7.0

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These percentages are low by local government standards, with up to 25 per cent considered manageable.

Key Financial Indicators

The forward financial estimates of the Council have provided the basis of key financial indicator projections in relation to Council’s:

Operating result; Sustainability; Loan servicing capacity; Liquidity.

(a) Operating Result

An operating surplus represents the extent to which operating income exceeds operating expenditure, including depreciation, and is projected each year, as follows:

Financial Year

Operating Surplus

Operating Surplus

Ratio

$ %

2014/15 6,761,785 13.8 2015/16 7,756,625 15.0 2016/17 8,737,604 16.0 2017/18 9,595,472 16.7 2018/19 10,517,982 17.3 2019/20 11,741,440 18.3 2020/21 12,617,640 18.6 2021/22 14,033,077 19.6 2022/23 15,575,227 20.6 2023/24 17,243,945 21.6

A strong ongoing operating result is a positive indicator of financial viability for the City of West Torrens. LGA Information Paper 9 Financial Indicators (February 2012) suggests an operating break even position, or better, over any five year period and an operating surplus ratio of between zero and 15 per cent on average.

(b) Sustainability

The asset sustainability ratio shows the extent to which capital expenditure on the renewal and replacement of assets matches the rate at which these assets are used or consumed, with the amount spent divided by the total depreciation expense. Achieving a break even result of 100 per cent or better demonstrates that the cost of consumption of assets in any one year is being met by current rates and current ratepayers.

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Financial Year

Capital Expenditure

Depreciation Expense

Asset Sustainability

Ratio

$ $ %

2010/11 9,903,300 9,712,524 102.0 2011/12 10,616,059 10,180,624 104.3 2012/13 10,455,759 10,238,565 102.1 2013/14 10,473,642 10,124,850 103.4 2014/15 10,917,398 10,479,330 104.2 2015/16 10,891,675 10,802,834 100.8 2016/17 13,200,117 11,136,330 118.5 2017/18 14,543,085 11,480,125 126.7 2018/19 13,482,454 11,834,537 113.9 2019/20 14,088,174 12,199,895 115.5 2020/21 14,250,339 12,576,538 113.3 2021/22 15,215,435 12,964,812 117.4 2022/23 17,171,773 13,365,079 128.5 2023/24 18,257,675 13,777,708 132.5

LGA Information Paper 9 suggests an asset sustainability ratio greater than 90 per cent but less than 110 per cent. This was achieved or is projected to be achieved in the 2010/11 to 2015/16 period, and is projected to be exceeded from the 2016/17 financial year.

The LGA paper also suggests a similar ratio range as being reasonable if measured against capital expenditure outlays in Infrastructure and Asset Management Plans (IAMP’s), rather than depreciation. Forward capital estimates are matched over the ten year forecast period to the IAMP’s adopted by Council, as shown in the table that follows.

Program IAMP

Amount $m

10 Year Plan $m

% Met

Roads Program

Reseal / Maintenance 55.017 55.017 100

Reconstruction Renewal 21.427 21.427 100

Kerb & Gutter 19.422 19.422 100

Footpath Program

Renewal 5.061 5.061 100

Construction 6.668 6.668 100

Building Program

Renewal Expenditure 25.498 25.498 100

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Additional amounts are included in the ten year financial plan to cover drainage and other infrastructure renewal works, along with new capital works. There is little need for renewal expenditure on stormwater assets over the next ten years, although there is a requirement for capital expenditure to build new and upgrade existing stormwater infrastructure. More detailed information on this expenditure will be compiled after the completion of the Urban Stormwater Catchment Management Plan, anticipated in 2014/15. More detailed work is also planned for other Council assets, including those covered by the recreation program.

(c) Loan Servicing Capacity

To meet a structured long term asset renewal and replacement program, Council will need to commit to a loan program that will result in loan liabilities increasing from $14.67 million to $40.94 million - a significant but manageable increase as demonstrated below. Borrowing interest rates ranging from 6.1 to 6.6 per cent have been estimated, along with a 15 year borrowing term.

Loan repayments as a percentage of rates is the industry accepted benchmark to assess a Council’s relative indebtedness. The percentages for West Torrens based on the actual and projected loan program are as follows:

Financial Year

Projected Loan

Repayments Loans to

Rates

$ %

2013/14 2,679,771 6.3 2014/15 2,679,771 6.0 2015/16 2,679,771 5.7 2016/17 3,025,777 6.1 2017/18 3,357,179 6.4 2018/19 3,450,527 6.2 2019/20 3,423,830 5.8 2020/21 3,912,337 6.3 2021/22 4,426,312 6.8 2022/23 4,582,000 6.6 2023/24 5,115,810 7.0

A percentage between zero and 25 per cent would normally be considered as being reasonable.

21


(d) Liquidity

Based on the assumptions used, a relatively balanced budget is achieved in each year for the next ten years in terms of the projected cash flow of the Council, net of cash reserves, as follows:

Financial Year

EOY Cash Estimate

Net Reserves

Surplus/ (Deficit)

$ $ $

2014/15 10,729,250 10,650,066 79,185 2015/16 7,528,036 7,430,279 97,757 2016/17 6,357,627 6,131,347 226,279 2017/18 8,285,701 8,289,035 (3,334) 2018/19 8,518,758 8,872,933 (354,176) 2019/20 9,339,044 9,476,935 (137,891) 2020/21 10,277,863 10,102,257 175,606 2021/22 11,105,033 10,750,190 354,843 2022/23 11,368,457 11,422,103 (53,646) 2022/23 11,580,707 12,119,449 (538,742)

22

Capital Budget

Budget and annual business plan Capital Budget

23


Introduction

The capital budget for 2014/15 totals $20,490,768 as follows:

$

Capital Works Environmental Program 2,602,020 Recreation Program 2,070,000 Transport Program 10,825,013 Sub Total 15,497,033

Capital Land and Building Works 3,125,000 Library Resources 298,785 Plant, Equipment & Furniture 1,569,950 Sub Total 4,993,735

Total 20,490,768

Rate funded capital expenditure has been increased by $1,733,957 to $15,180,909, an increase of 12.9 per cent, as shown in the table that follows. The increase includes a capital works increase of $1,090,013, or 9.8 per cent, to $12,187,174.

Budget 2013/14

Budget 2014/15 Variance

$ $ $

Rate Funded City Works Funds 11,097,161 12,187,174 1,090,013 Plant and Equipment 1,125,650 1,569,950 444,300 Land and Buildings 895,000 1,125,000 230,000 Library Resources 329,141 298,785 (30,356)

Sub Total 13,446,952 15,180,909 1,733,957

1.6

0.3

3.1

10.8

2.1

2.6

0 2 4 6 8 10 12

Plant and Equipment

Library Resources

Land and Buildings

Transport Program

Recreation Progream

Environment Program

$'s ('000,000's)

City of West TorrensCapital Expenditure 2014/15

Works

Buildings and Equipment

24


Other Funded

Grants 1,008,839 1,282,839 274,000 Reserves / Asset Sales 2,205,146 2,000,000 (205,146) Loans 1,714,000 2,027,020 313,020

Sub Total 4,927,985 5,309,859 381,874

Total Capital Budget 18,374,937 20,490,768 2,115,831

Capital funding from other than rates totals $5,309,859, as shown in the table that follows:

$

Lockleys catchment drainage (Loan) 2,027,020

Community hub development (Reserves) 2,000,000

Roads to Recovery grant 438,839

Urban Local Road grant 604,000 Black Spot Funding - Thebarton 240,000

Total 5,309,859

Environment Program The drainage budget comprises the following:

$165,000 for minor drainage upgrades and replacement works, including the replacement / upgrade of side entry pits and junction boxes, minor pipe replacements and upgrades due to damage and/or failure, stormwater pump station improvements and minor investigations into the current drainage network.

$2,027,020 in loan funding to undertake detailed design / documentation and construction for Lockleys catchment drainage - stage 1 (Rutland Avenue system).

$350,000 to modify / extend existing stormwater drainage in Ashley Street, Torrensville (Hayward Avenue catchment).

$20,000 for water sensitive urban design in Gardner Street, Plympton. Other environmental projects include $40,000 for improvements to the supply of water for irrigation within the Kings Reserve and Thebarton Oval complex.

25


Recreation Program Recreation works include the following:

$780,000 for new, replacement and upgraded playgrounds, based on a program developed in response to an updated audit undertaken in 2013 from the original audit in 2008 of playground safety. Nominated playgrounds for 2014/15 are:

DCA Reserve, Beare Avenue, Adelaide Airport / Netley; Lysle Street Reserve, Brooklyn Park; Civic Centre - Memorial Gardens, Hilton; Halsey Road Reserve, Fulham; Parkin Reserve, Neston Avenue, Netley; River Torrens Linear Park, Riverview Drive, Lockleys; River Torrens Linear Park, Sherriff Street, Underdale; Poplar Street Reserve, West Beach; Cummins Reserve, Saratoga Drive, Novar Gardens; Camden Oval (South), Novar Gardens adjacent to Glenlea Tennis Club; Shade shelter (sites to be confirmed); Additional gym equipment on the Westside Bikeway; Minor playground equipment.

$315,000 for reserve upgrades, including:

Further upgrade of Reedbeds Community Centre Reserve (part funded in

2013/14); Upgrade / relocation of the war memorial in Bill Sheppard Reserve (Aroona

Place, Glenelg North); Kings Reserve interface with Ashwin Parade, Torrensville; Pedestrian lighting on reserves, including a power upgrade (connection

supply) to the Civic Memorial Gardens for special events; Ongoing gazebo upgrades and replacements; Various fencing and bollard replacements on reserves; Turf replacement and sundry reserve pathway upgrades.

$435,000 for projects along the River Torrens Linear Park, including:

Continuation of a staged pedestrian lighting project (LED) aimed at upgrading

and replacing pedestrian lights to meet Australian standards and improving safety for users;

Upgrade to the eastern shared pathway under Henley Beach Rd, Fulham; including closure for cyclists and the establishment of pedestrian only access;

General fencing and the installation of retaining walls and barrier protection.

$30,000 for the ongoing reseal and reconstruction of various pathway sections along the River Torrens Linear Park in order to meet the current path width standard.

$60,000 for the staged resealing and reconstruction of various sections of city bikeways, a program that will be ongoing over the next few years, subject to funding provision.

$380,000 for irrigation system upgrades for the following reserves to meet SA Water guidelines:

26


College Park Reserve, Brooklyn Park; Helenslea Avenue Reserve, Brooklyn Park; Lysle St Reserve, Brooklyn Park; River Torrens Linear Park, Riverview Drive to Lasscock Ave, Lockleys; River Torrens Linear Park, Tracey Crescent, Lockleys; River Torrens Linear Park, Sherriff Street, Underdale; Westside Bikeway, Marleston / Plympton (selected areas); Elsie Street / Freda Street Reserve, Netley; Shephard Court Reserve, Novar Gardens; Kings Reserve, Torrensville; Poplar Street Reserve, West Beach; General irrigation equipment, including controllers and backflow meter

equipment.

$70,000 for the upgrade of tennis courts at Apex Park and Rex Jones Reserve. Works include re-surfacing and fencing.

Transport Program Funding totals $10,825,013 ($9,541,000 in 2013/14) as follows:

$ Road maintenance program 5,538,823 Road reconstruction program 3,198,712 Other road works 1,166,940 Footpath program 920,538

Total 10,825,013

Road Maintenance Program In order to ensure that the Council manages its road (surface, pavement and kerb and gutter) assets in a manner most appropriate for the community, a commitment has been made to a road Infrastructure Asset Management Plan which ensures adequate provisions are made for existing and future infrastructure so that assets are fully utilised i.e. their design life is achieved in a cost effective manner. This year’s capital works program for roads has been based on an updated and Council adopted Infrastructure and Asset Management Plan for roads, which took into consideration the strategic report City of West Torrens Transport Strategy - Transportation for the next Generation 2025. The schedule of capital works for roads is based on the principles / methodologies developed in the implementation of a ten year capital works program following a condition audit of Council’s network undertaken in 2010 upon which Council’s current long term financial plan is based. The schedule of works also considers customer requests.

27


This year's capital works program for road maintenance totals $5,538,823 as follows:

$

Reseal / road maintenance program 3,385,774 Kerb and gutter program 2,153,049

Total 5,538,823

Details are provided on pages 33 to 35, and include works from customer requests and a recent reconditioning audit of the road network. Road Reconstruction Program Council’s road reconstruction program totals $3,198,712 and comprises the following:

Brooker Terrace (part), Richmond; Hudson Court, Netley; West Thebarton Road / Phillips Street, Thebarton - incorporating the undergrounding

of power (stage one); Shannon Avenue/Wongala Avenue, Glenelg North- road realignment; Beauchamp Street (part), Kurralta Park; Morphett Road (part), North Plympton.

This schedule of works provides a balanced approach to assist renewal and maintain strategic roads to an acceptable level whilst managing the expectation of community and road users. Other Road Works

Other road works total $1,166,940 and include: $200,000 for localised road failure and rehabilitation work; $150,000 for the on-going installation and upgrade of public bus shelters at identified

sites; $470,000 for minor traffic management work at identified locations, including

pavement bar layouts, pedestrian kerb ramps, stop and give way signage with associated line marking, the construction of a roundabout at the intersection of George and Dew Streets, Thebarton, Way2Go projects, and the relocation of the road closure in Vintage Road, Underdale;

$165,000 for bicycle management schemes involving a shared path in Watson

Avenue, Netley, as identified in a planning study for the Adelaide Airport ring route, along with the creation of a shared path around the West Beach Road detention basin;

$181,940 for ancillary works identified in the recent bridge audit.

The roundabout at the corner of George and Dew Streets, Thebarton involves $240,000 in yet to be approved external black spot funding and a Council contribution of $120,000.

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Footpath Program

A condition assessment of Council’s 626 kilometres of footpaths was undertaken in mid 2011 and it provided the basis for a new forward renewal and maintenance. Concurrently with this assessment, Council developed an “Installation of New Footpath Priority System” report to determine the order in which new footpaths are installed within Council. The installation of new footpaths applies to:

Local roads that do not have a footpath on either side of the road; Collector and arterial roads that do not have footpaths on both sides of the road; and Local roads when a footpath is required on both sides of the road due to high

pedestrian demand such as a bus route, school, shopping centre or nursing home. It is a Disability Discrimination Act requirement that there be a footpath on one side of all roads, for the safety and accessibility of pedestrians. Local and major collector roads which carry over 3,000 vehicles per day and are defined in Council’s transport's strategy should have a footpath on both sides of the road for the safety of pedestrians, along with areas that have high pedestrian demand. The findings of the above formed the basis of the updated Footpath Infrastructure and Asset Management Plan that was last adopted in November 2012. The objective of the plan is to provide a safe and practically manageable footpath and cycle / shared path network with an emphasis on the reduction in risk as opposed to aesthetics, and set priorities for the renewal and provision of new footpaths and cycle / shared paths. The functional level of service for footpaths has and will continue to consider community expectations, legislative compliance and future demand needs. A further review of the risks associated with our footpath assets was undertaken in 2013/14 and confirmed a high risk along arterial roads. Council in past budgets has allocated funds to commence risk mitigation works, and it is proposed that this be continued with a budget allocation to city wide footpaths for upgrades to occur at various locations. The footpath schedule of works this year is made up of $389,278 for footpath renewal, $331,260 for new footpath construction and $200,000 for footpath remediation. The following work is proposed:

Footpath Renewal Program $389,278 Beckman Street, Glandore (Glengyle Terrace to Wheaton Road); Colin Street, Camden Park (Creslin Terrace to Stonehouse Avenue); East Street, Torrensville (Carlton Parade to Henley Beach Road); Hare Street, Kurralta Park (Beauchamp Street to South Road); Harvey Avenue, Netley (Marion Road to Debra Court); Holbrooks Road, Underdale (City Boundary to Armour Avenue); Lydia Street, Plympton (Anzac Highway to property No 2); Moresby Street, Lockleys (Brecon Street to Burbridge Road); Pierson Street, Lockleys (Brian Street to Malurus Avenue); Railway Terrace, Mile End South (Richmond Road to Manchester Street); Richmond Road, Keswick (South Road to Railway Terrace); Rowells Road, Lockleys (Brian Street to city boundary); Ann Street, Thebarton (West Thebarton Road to end).

29


New Footpath Construction Program $331,260 Aroona Avenue, Glenelg North (Wongala Avenue to McCann Avenue); Boswarva Avenue, Plympton (Crews Crescent to Emma Place); Burbridge Road, West Beach (Pennine Street to Fawnbrake Crescent); Corona Avenue, Lockleys (Durham Avenue to Fulham Park Drive); Durham Avenue, Lockleys (Castlebar Road to Corona Avenue / Horsley Street); Everard Avenue, Keswick (Ashford Road to Kent Road); Fleet Street, Richmond (Richmond Road to Fleet Street); Fleet Street, Richmond (South Road to Main Terrace); Marion Road, Plympton (Anzac Highway to Lydia Street); Michael Street, Lockleys (Peter Street to Matt Street); Miranda Avenue, Lockleys (Rutland Avenue to Netley Avenue); Netley Avenue, Lockleys (Strathmore Avenue to Rutland Avenue); Osborne Terrace, Plympton (Crews Crescent to Boswarva Avenue); Shannon Av, Glenelg North (McCann Avenue to Wongala Avenue); Stephens Avenue, Torrensville (Ashley Street to Howie Avenue); Wilson Street, Cownadilla (Sir Donald Bradman Drive to Jenkins Street); Wongala Avenue, Glenelg North (Shannon Avenue to Aroona Avenue).

Footpath Remediation Program $200,000

City wide footpath remediation - upgrade to arterial road footpaths at street tree locations.

This footpath program is subject to change, but details will be provided to Council if this occurs.

Land and Buildings

The capital expenditure budget for land and buildings totals $3,125,000 ($3,015,000 in 2013/14) and comprises:

$25,000 for upgrades of Council owned facilities to meet Disability Discrimination Act

(DDA) requirements, as identified in Council's Building Asset Management Plan (2013).

$20,000 for asbestos removal as part of an on-going program of minor works

involving Council owned buildings that have been identified in Council's Building Asset Management Plan (2013).

$25,000 for fire system upgrades, as part of an on-going program of minor works to bring Council owned buildings up to current building rules standards, as identified in Council's Building Asset Management Plan (2013).

$25,000 for on-going electrical compliance minor upgrades of Council owned facilities in accordance with current electrical compliance regulations, as identified in Council's Building Asset Management Plan (2013).

$20,000 for safe access to roof infrastructure.

30


$200,000 for on-going building compliance upgrades of Council owned facilities as identified in Council's Building Asset Management Plan (2013). Selected projects will include:

Cowandilla Reserve - tennis clubrooms Cowandilla Reserve - Western Youth Centre Golflands Reserve - clubrooms Kesmond Reserve - demolition of the Jaguar drivers' clubrooms

$160,000 for the Western Youth Centre at Cowandilla Reserve to construct new DDA

facilities and undertake additional works to meet current fire compliance requirements.

$50,000 in further funding to continue detailed investigation, review and concept design work for building facilities used by sporting clubs at Lockleys Ovals ($25,000 budgeted in 2013/14).

$300,000 to fund Thebarton Theatre fire safety upgrades (stage 2).

$50,000 for preliminary investigation, review and concept design work for the upgrade of facilities at Mellor Park, Lockleys.

$250,000 for installation within the Camden Oval complex of new DDA compliant public toilet facilities (Exeloo or similar) near the existing cricket club building.

$2,000,000 for the ongoing development of community hub and related facilities (asset sale funded).

Plant, Equipment and Furniture

The capital budget for plant, equipment and furniture totals $1,569,950 ($1,210,796 in 2013/14) and comprises:

$133,950 for various items of depot plant and equipment, including a front end loader

bucket sieve for use with mulch ($50,000), trailer upgrades ($23,000), workshop equipment ($20,000), the replacement of two tanks for the water trucks ($14,000), road cutting equipment, and power and mechanical tools.

$114,500 for the replacement of 13 motor vehicles in the Council fleet, including commercial vehicles ($206,000 for 27 motor vehicles in 2013/14).

$397,500 for furniture and equipment, including $300,000 to replace key IT server and storage infrastructure that is over four years old, $50,000 to replace switch infrastructure that is over eight years old and $40,000 for replacement of a five year old scanner / printer. These items were previously included in the operational budget as part of Council's leasing program, but now need to be budgeted as capital items.

$80,000 for various items of furniture and equipment at St Martins, all of which is resident related.

$84,000 for the programmed replacement of two ride-on mowers ($44,000), a gator utility ($16,500) and two mowing trailers ($23,500). These are high use operational

31


machines that require regular replacement to ensure a suitable residual value and low yearly maintenance costs.

$590,000 to replace / purchase two tipper trucks ($225,000), a rapid response team

truck ($130,000), and a truck with an elevated work platform ($235,000), all of which are used in the general civil, horticultural and cleansing maintenance areas. The trucks being replaced range in loading capacity from two to ten tonne and age from eight to ten years.

$170,000 for other furniture and fittings, including $120,000 to continue library and auditorium refurbishment work and $50,000 to install new AV equipment at the Thebarton Community Centre.

Library Resources An amount of $298,785 is being budgeted ($329,141 in 2013/14) and it comprises the following:

State resources $187,785; Local resources $111,000.

32


Road Reseal / Rehabilitation and Kerb and Gutter Program

Street Name Suburb

Albert Av (Inkerman Av to Clifton St) Camden Park Carlton Rd (Capper St to Creslin Ter) Camden Park Carlton Rd (Property No 20 to Curzon St) Camden Park Carlton Rd (Curzon St to Clifton St) Camden Park Creslin Ter (Capper St to Cromer St) Camden Park Fitzroy Av (Thornber Av to Mooringe Av) Camden Park Inkerman Av 5150 (Patricia Av to Penong Av) Camden Park Morphett Rd (Bonython Av to Mooringe Av) Camden Park Ayton Av (Colwood Av to Riverside Dr) Fulham Ayton Av (Riverside Dr to Susan St) Fulham Ayton Av (Henley Beach Rd to Gault Av) Fulham Crace Rd (Halsey Rd to Good St) Fulham Fitch Rd (Good St to Coral Sea Rd) Fulham Gault Av (Ayton Av to East Pkwy) Fulham Gault Av (East Pkwy to Everest St) Fulham Bonython Av (Iluka St to Ulinga St) Glenelg North Bonython Av (Ulinga St to Pine Av) Glenelg North Mccann Av (Bonython Av to Orana Av) Glenelg North Mccann Av (Orana Av to Shannon Av) Glenelg North Chatham Rd (Everard Av to Property No 27) Keswick Chatham Rd (Property No 27 to Richmond Rd) Keswick Richmond Rd (South Rd to Croydon Rd) (Kerb only) Keswick Beauchamp St (Tennyson St to Garfield Av) Kurralta Park Mortimer St (Gray St to Grassmere St) Kurralta Park Mortimer St (Grassmere St to Warwick Av) Kurralta Park Arcoona Av (Fulham Park Dr to End) Lockleys Arden Av (Rowells Rd to Boston Av) Lockleys Boston Av (Grallina St to Arden Av) Lockleys Boston Av (Arden Av to Anthus St) Lockleys Brecon St (Moresby St to Burbridge Rd) Lockleys Chester St (Anthus St to Counter Av) Lockleys Corona Av (Horsley St to Fulham Park Dr) Lockleys Dunrobin St (Torrens Av to Property No 17) Lockleys Peter St (Douglas St to Lancaster St) Lockleys Strathmore Av (Property No 16 to Southerly Av) Lockleys Note: This schedule will change, but details will be provided to Council.

33


Road Reseal / Rehabilitation and Kerb and Gutter Program

Street Name Suburb

John St (Sarah St to South Rd) Marleston Darebin St (Falcon Av to End) Mile End King St (Railway Tce to Victoria St) Mile End King St (Victoria St to Claremont St) Mile End King St (Claremont St to South Rd) Mile End Rose St (Taylors L to Dew St) Mile End Rose St (Property No 29 to James Congdon Dr) Mile End Railway Ter (Manchester St to Richmond Rd) (Kerb only) Mile End South Holt St (Beare Av to Shelley Av) Netley Bransby Av (Dingera Av to Hawson Av) North Plympton Bransby Av (Mooringe Av to Dingera Av) North Plympton Errington St (Dingera Av to Hawson Av) North Plympton Hawson Av (Errington St to Streeters Rd) North Plympton Hawson Av (Marion Rd to Bransby Av) North Plympton Hawson Av (Bransby Av to Neston Av) North Plympton Keith Av (Birdwood Ter to Packard St) North Plympton Keith Av (Packard St to Wyatt St) North Plympton Keith Av (Wyatt St to Marion Rd) North Plympton Neston Av (Mooringe Av to Dingera Av) North Plympton Streeters Rd (Spring St to Electra St) North Plympton Streeters Rd (Electra St to Harvey Av) North Plympton Miller Ct (Graham Cres to End) Novar Gardens Shephard Ct (Bonython Av to End) Novar Gardens Lydia St (Lydia St to Marion Rd) Plympton Mcarthur Av (Birdwood Ter to Urrbrae Ter) Plympton Mcarthur Av (Tilden St to Oval Ter) Plympton Myer Av (Penong Av to Proprty No 3) Plympton Chambers Av (Bickford St to Kitson Av) Richmond Lane St (Sanders St to Marion Rd) Richmond Redin St (Chambers Av to Weaver Av) Richmond Sanders Ln (Lucas St to Property No 6) Richmond Note: This schedule will change, but details will be provided to Council.

34


Road Reseal / Rehabilitation and Kerb and Gutter Program Street Name Suburb Suburb

Holland St (Anderson St to Phillips St) Thebarton

Kintore St (South Rd to Pearson St) Thebarton

Kintore St (Pearson St to Dew St) Thebarton Kintore St (Dew St to Parker St) Thebarton Maria St (Albert St to Dew St) Thebarton Randolph St (Dew St to Neville Rd) Thebarton Walter St (South Rd to Neville Rd) Thebarton Clifford St (Carlton Pde to Henley Beach Rd) Torrensville Danby St (Ashley St to North Pde) Torrensville North Pd (Sherriff St to Hardy's Rd) Torrensville North Pde (Stephens Av to Hardy's Rd) Torrensville North Pde (South Rd to Wainhouse St) Torrensville River Rd (End to End) Torrensville Stephens Av (Henley Beach Rd to Carlton Pde) Torrensville Norman St (Sherriff St to Holbrooks Rd) Underdale Sherriff St (Golden Glow Av to Hurtle St) Underdale Sherriff St (Norman St to Henley Beach Rd) Underdale Wycombe St (Cranbrook Av to Sherriff St) Underdale Atlantic Av (Arctic Av to West Beach Rd) West Beach Formosa Av (Northern Av to Baltic Av) West Beach Burbridge Rd (Service Road) (Weston St to Weston St) West Beach Norwich St (Passmore St to Britton St) West Richmond

Note: This schedule will change, but details will be provided to Council.

35


ORIGINAL REVISEDBUDGET BUDGET 2014/152013/14 2013/14 DESCRIPTION BUDGET

CAPITAL WORKS

Environment Program

Stormwater & Drainage

0 489,468 Mile End Cowandilla Catchment 00 2,401,038 Mile End Cowandilla Outfall Drain 00 113,769 West Beach Drain Connection 00 145,908 Marshall Terrace 00 3,591 Railway Terrace 0

150,000 150,000 Minor Drainage Upgrades and Replacement Work 165,0000 350,000 Stormwater Trunk Drain- Brickworks Site 00 0 Lockleys Catchment 2,027,0200 0 Ashley St (West St to Hayward Ave) 350,0000 0 Gardner St (WSUD) 20,000

200,000 200,000 Roebuck Street Drainage Upgrade 0Other Environment

0 0 Kings Reserve - Water Supply 40,0001,714,000 2,489,000 Brown Hill and Keswick Creeks 0

0 250,000 Brownhill / Keswick Creek Remediation 0250,000 0 Brownhill / Keswick Creek Essential Works 0

0 215,238 GAP - Recycled Water Pipeline Project - Stage A 00 15,604 GAP - Recycled Water Pipeline Project - Stage 2 0

2,314,000 6,823,616 Program Total 2,602,020

Recreation Program

Parks & Gardens

810,000 1,333,992 Playground Upgrades 780,000205,000 205,000 Reserve Developments - Various (includes Upgrades) 315,000440,000 620,874 River Torrens Upgrade / Developments 435,00030,000 30,000 River Torrens Path Upgrades & Re-seals 30,00060,000 60,000 Westside Bikeway Path Upgrade & Re-seal 0

370,000 428,086 Reserves - Irrigation Upgrades 380,0000 22,510 Lindfield Reserve Project 00 48,600 Clifford St Reserve Upgrade 00 450,000 Urban Forest, James Congdon Drive 00 0 Various Bikeway (path) Upgrade & Reseal 60,000

Sports Facilities

0 0 Tennis Court Upgrades 70,00050,000 0 Novar Gardens Bowling Club Shade / Rinks Upgrade 0

Other Cultural Services

0 735,882 Facility Carpark Upgrades / Renewals 0

1,965,000 3,934,944 Program Total 2,070,000

36



Transport Program

Roads Sealed

0 3,767,645 City Funds / ULRG Funds / Carryovers 03,050,212 3,050,212 Reseal / Road Maintenance Program 3,385,7742,190,468 2,190,468 Road Reconstruction Program 2,759,8732,160,793 2,160,793 Kerb and Gutter Program 2,153,049

438,839 438,839 Roads To Recovery 438,839Other Transport

200,000 200,000 Roundabouts / Minor Road Rehabilition 200,00060,000 148,593 Bus Shelters 150,000

105,000 105,000 Traffic Management 470,000145,000 433,729 Bicycle Management Schemes 165,000

0 31,546 Corporate Branding - Signage 050,000 64,782 Public Lighting 0

200,000 200,000 Bio-Science Precinct Works 0Bridges

100,000 100,000 Bridge Ancillary Works (as per Bridge Audit) 181,9400 33,343 Footbridge Rehabilitation - Holland St - Stage 2 00 286,310 Manchester Street Bridge Road Design 0

Footpaths

356,013 582,566 Footpath Renewal Program 389,278284,675 319,505 Footpath Construction Program 331,260200,000 219,147 Footpath Remediation 200,000

9,541,000 14,332,478 Program Total 10,825,013

13,820,000 25,091,038 TOTAL - CAPITAL WORKS 15,497,033

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OTHER CAPITAL EXPENDITURE

Land and Buildings

25,000 29,461 DDA Upgrade Program 25,000100,000 0 DDA Upgrade Program - Weigall Oval toilet upgrade 020,000 20,000 Asbestos Removal Program 20,00025,000 88,375 Fire Systems Upgrade 25,00050,000 70,019 Electrical Compliance Upgrade 25,00060,000 98,036 Environmental/Sustainability Program/Systems 0

200,000 0 Airconditioning Upgrade - Civic Precinct 020,000 20,000 Roof Access safety systems 20,000

200,000 214,408 Building Compliance Upgrade 200,0000 100,000 LG Energy Efficiency Program 0

100,000 100,000 Carpet Replacement - Civic Centre & Hamra Library 050,000 50,000 Painting - Hamra Library 020,000 20,000 Western Youth Centre DDA Investigation and Design 160,00025,000 25,000 Lockleys Oval Concept Design 50,000

0 40,000 Demolition former SES building 00 354,743 Thebarton Theatre fire safety 300,0000 0 Mellor Park - Redevelopment 50,0000 0 Camden Oval - Public Toilet Facilities (DDA) 250,0000 50,000 Novar Gardens Bowling Club Greens 0

50,000 50,000 St Martins Lighting compliance 030,000 30,000 St Martins Administration re-design 0

0 153,930 St Martins Safety Compliance 00 61,845 St Martins Maintenance Building Extension 00 115,867 St Martins Lift 00 90,000 St MartinsFire Shutter and Chemical Bay 0

2,000,000 2,100,000 Community Hub & Related Facilities 2,000,00040,000 40,000 Hub signage 0

0 156,802 Thebarton Hub & Kings Reserve 00 17,795 Freezer - Thebarton Community Hub 0

-750,000 0 Sale of Land and Buildings 0

2,265,000 4,096,281 Total Land and Buildings 3,125,000

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Plant, Equipment and Furniture

49,150 54,922 Minor Depot Plant and Equipment 133,950206,000 213,344 Motor Vehicle Replacements 114,500115,000 231,000 Furniture and Equipment 397,50079,146 91,141 St Martins' Furniture and Equipment 80,000

134,500 128,728 Replace Mowers (2013/14 x 4; 2014/15 x 2) 67,5000 0 Replace John Deere Gator 16,500

297,000 297,000 Replace Trucks / Tippers (2013/14 x 4; 2014/15 x 3) 590,000250,000 400,000 Replace Footpath Sweeper (2 x sweepers) 0

0 42,000 Replace Bob Cat 00 62,000 Thebarton Community Centre AV Equipment 50,0000 37,000 Web Content Management System 00 50,000 Auditorium Refurbishment & Public Artwork 60,0000 60,000 Library Refurbishment 60,0000 4,889 St Martins' Nurse Call System Replacement 0

80,000 80,000 Replace Tractor and Earthquake Unit 0

1,210,796 1,752,024 Total Plant, Equipment and Furniture 1,569,950

Library Resources

218,141 218,141 Library Resources - Central 187,785111,000 111,000 Library Resources - Local 111,000

329,141 329,141 Program Total 298,785

3,804,937 6,177,446 TOTAL - OTHER CAPITAL 4,993,735

17,624,937 31,268,484 TOTAL ALL CAPITAL EXPENDITURE 20,490,768

39


40

Operational Budget

Budget and annual business plan Operational Budget

41


Summary

Council’s operating statement in the 2014/15 budget projects a surplus from operations of $6,761,785, as shown below, based on a 4.0 per cent rate increase. This rate increase is marginally lower than the increase endorsed in the long term financial plan of the Council in 2013/14.

Income $ Rates and Rate Equivalents 48,935,973 Statutory Charges 1,702,260 User Charges 9,080,860 Grants and Subsidies 3,476,139 Sundry Income 993,035

Total Income 64,188,267

Expenditure

Employee and Related 26,231,549 Material and Contract 7,650,692 Finance Costs 988,050 NRM Levy 1,196,573 Depreciation 10,479,330 Other 10,880,288

Total Expenditure 57,426,482

Operating Surplus 6,761,785

Note that the surplus above is an indicator of operating performance, including the funding of asset depreciation, but is not an indicator of the cash surplus of the Council. Capital expenditure covered in the previous section of this document is not included in the expenditure above.


Operational expenditure has increased by $2,251,797 or 4.1 per cent, relative to the original 2013/14 budget, as follows:

$

St Martins 543,689 All Other 1,708,108

Total 2,251,797

The increase for St Martins is self-funded.

All other operational expenditure, before depreciation, has increased by $1,708,108 or 3.6 per cent, relative to the original 2013/14 budget ($2,088,204 or 4.6 per cent last budget), as follows:

42


Budget 2013/14

Budget 2014/15 Variance Variance

$ $ $ %

Employee Costs 19,204,930 20,178,479 973,549 5.1 Building, Equipment and Related 1,905,020 1,710,570 (194,450) (10.2) General Expenses 4,115,034 4,499,520 384,486 9.3 Bank and Finance Charges 977,905 866,159 (111,746) (11.4) Council Related Expenses 2,068,395 2,106,773 38,378 1.9 Contract and Material Expenses 7,506,415 7,554,590 48,175 0.6 NRM Levy 1,162,422 1,196,573 34,151 2.9

Occupancy and Property Costs 1,352,073 1,463,540 111,467 8.2 Internal Charges / Recoveries (135,400) (58,000) 77,400 (57.2)

Sub Total 38,156,794 39,518,204 1,361,410 3.6

Depreciation 9,693,362 10,040,060 346,698 3.6

Total 47,850,156 49,558,264 1,708,108 3.6

Notable Cost Containment Costs have been contained across all areas of the Council to achieve the increase of just 3.6 per cent that is shown above, but it is noteworthy that:

Employment costs (excluding St Martins) have increased by $973,549 or 5.1 per cent

over the original budget estimates for 2013/14 ($649,231 or 3.5 per cent last budget), but three proposed new positions account for $240,000 of this increase. This is explained further later in this commentary under the heading “Employment Costs”.

Water rates and related charges (excluding St Martins) are being increased by $123,840 or 24.2 per cent, reflecting the impact of both increased usage and higher tariffs.

Additional costs associated with local government elections in November 2014 of $168,500 are being budgeted.

The cost increase proposed in the budget, excluding the three items above and St Martins which is self-funded, is $1,175,768 or 2.5 per cent, which compares favourably with both the consumer price index (currently 2.9 per cent for Adelaide) and the local government price index (currently 2.5 per cent). Other Notable Items Other notable items include:

Waste disposal and collection costs have been reduced by $60,000 or 1.4 per cent, largely because of expected changes to carbon tax arrangements;

Interest payable (excluding St Martins) is decreasing by $116,524 or 13.9 per cent over what was budgeted in 2013/14, reflecting the impact of loans not being taken since September 2012;

43


Computer hardware costs have fallen by $245,620 or 64.5 per cent following changes to leasing arrangements, but this is offset fully by increased capital budget costs.

Operational expenditure, based on business functions of the Council, is as follows:

Employment Costs Employment costs (excluding St Martins) have increased by $973,549 or 5.1 per cent over the original budget estimates for 2013/14 ($649,231 or 3.5 per cent last budget), but three new positions costing $240,000 have been budgeted as follows:

$150,000 for two positions to establish a rapid response team at the depot; $90,000 for a new planning position in City Development to deal with substantial

development assessment workload increases.

The cost of the planning position is offset by a reduction of $30,000 in contractor support for locums to be engaged.

0.7

0.9

1.6

0.1

1.5

2.4

3.1

1.7

4.5

1.2

1.8

2.7

2.4

7.9

11.8

13.1

0 2 4 6 8 10 12 14 16

Office of the CEO

Elected Council

Organisational Support

Mendelson Foundation

HR / Service Centre

Information Services

Financial Services

Compliance & Health

Waste Management

City Strategy

City Development

Hamra Library

Community Services

St Martins

City Works & Property

City Assets & Cummins

$m

City of West TorrensOperational Expenditure 2014/15

Urban Services

Strategy & Community

Office of the CEO

Corporate & Regulatory

Organisational Support

44


Staff numbers have been increased by 2.7 full time equivalents (FTE’s), reflecting the three new positions and a small FTE reduction. FTE numbers were reduced in each of the last two financial years (by 0.9 FTE in 2013/14 and 9.1 FTE in 2012/13). An allowance of $150,000 has been made for an assumed level of vacancies occurring during the year (also $150,000 in 2013/14). The replacement of staff on leave is largely unfunded in the budget, apart from direct service providers such as the library, St Martins and the Service Centre. A sufficient level of saving during the course of the year when vacancies are not back-filled is expected to occur to fund any staff replacements that may be required. Income All income is budgeted to increase by $3,512,680 or 5.8 per cent over 2013/14 budget as follows:

Budget 2013/14


$ $ $

Rates & Rate Equivalents Payments 46,403,422 48,935,973 2,532,551 Statutory Charges 1,497,630 1,702,260 204,630 User Charges 8,498,859 9,080,860 582,001 Grants - General Purpose Grant 1,166,532 1,197,000 30,468 Grants - Other 2,041,164 2,279,139 237,975 Sundry Income 1,067,980 993,035 -74,945

Total

60,675,587

64,188,267

3,512,680

Rate Income 76.2 per cent of the income budgeted by Council is derived from rates and rate equivalent payments, as follows:

Rates & Equivalent

76.2%

Statutory Charges

2.7%User Charges14.1%

Grants5.4%

Other1.5%

City of West TorrensIncome for 2014/15

45


As can be seen in the following graph, Council's dependency on rate revenue continues to be significant due to the reduction in other forms of income, notably the general purpose grants (refer next section). While Council can obtain grants for specific purposes, substantially increased general purpose grants are unlikely to be obtained in the foreseeable future.

Council has endeavoured to limit increases in rates and since 1994/95 has achieved an average increase of 4.8 per cent (excluding natural growth), as shown in the chart that follows:

46


Rate Calculation Rates in 2014/15 are determined on the following basis:

$

Rate Income 2013/14 41,759,137 Add Natural Growth @ Net 1.3% 542,869

Rates Prior to Rate Increase 42,302,006

Add Net Rate Increase 1,687,994

Rates Raised (excluding fines) 43,990,000

Rate equivalent payments by Adelaide Airport Limited are excluded from the above rate calculations, along with NRM levies, rebates, remissions and discounts. Minimum Rates A minimum rate of $826 is proposed for 2014/15 ($794 in 2013/14), an increase of $32 or 4.0 per cent. This rate is expected to result in substantially less than 35 per cent of West Torrens Council properties being minimum rated and ensure compliance with Section 158 of the Local Government Act 1999. West Torrens had the fourth lowest minimum rate in metropolitan Adelaide in 2013/14 at $794. Minimum rates in metropolitan Adelaide average $862 and range between $682 (Unley) and $1,024 (Tea Tree Gully). Rate Movements It is proposed that rates be increased as follows:

Minimum Rate : Up 4.0%

Non-Residential : Up 4.0%

Residential : Up 4.0%

Overall Increase : Up 4.0%

Rates Comparison with Other Councils A comparison of rates with other metropolitan councils reveals that West Torrens Council’s average rates of $1,422 are low. The information is based on an LGA survey and is considered a reliable indicator of Council’s rating effort.

47


Using West Torrens as the base, the ratio indicates the factor by which other council rates compare. For example, the average rates of Walkerville Council are 1.4 times higher than those of West Torrens.

Rates per Rateable Assessment 2013/14

Council Average

Rates Ratio

$ %

Walkerville 1,860 1.3 Unley 1,785 1.3 Prospect 1,731 1.2 Adelaide Hills 1,690 1.2 Charles Sturt 1,604 1.1 Playford 1,588 1.1 Tea Tree Gully 1,571 1.1 Burnside 1,571 1.1 Mitcham 1,560 1.1 Marion 1,540 1.1 Gawler 1,517 1.1 Norwood, Payneham 1,506 1.1 Holdfast Bay 1,453 1.0 West Torrens 1,422 1.0

Salisbury 1,395 1.0 Onkaparinga 1,383 1.0 Port Adelaide Enfield 1,362 1.0 Campbelltown 1,311 0.9 Average 1,547 1.1

Source: LGA Survey

Another view of Council’s rating is based on average residential rates, details which follow. It is worth noting that generally councils with differential rates, like West Torrens, move to a lower range to reflect the lower residential rate in the dollar charged.

Rates per Residential Assessment 2013/14

Council Average

Rates Ratio

$ %

Walkerville 1,760 1.8 Adelaide Hills 1,717 1.7 Unley 1,543 1.6 Prospect 1,538 1.6 Burnside 1,536 1.6

48


Mitcham 1,439 1.5 Tea Tree Gully 1,404 1.4 Norwood, Payneham 1,379 1.4 Holdfast Bay 1,354 1.4 Gawler 1,301 1.3 Onkaparinga 1,299 1.3 Marion 1,299 1.3 Campbelltown 1,282 1.3 Playford 1,206 1.2 Charles Sturt 1,203 1.2 Salisbury 1,139 1.2 West Torrens 983 1.0

Pt Adelaide Enfield 894 0.9

Average 1,349 1.4

Source: LGA Survey Rate Modelling

More detailed rate modelling information, prepared pursuant to the requirements of Section 123 of the Local Government Act 1999, is included in section 7 of this document which deals with rating 2014/15. Grant Income

Grant income budgeted in 2014/15 totals $3,476,139 ($3,207,696 in 2013/14) as follows:

Budget 2013/14


$ $ $

General Purpose Grant 1,166,532 1,197,000 30,468 Road Grants 570,000 604,000 34,000 Library 397,472 389,463 (8,009) Home and Community Care 465,663 470,000 4,337 Special Road Grants 438,839 678,839 240,000 Sundry Grants 169,190 136,837 (32,353)

Total 3,207,696 3,476,139 268,443

The special road grants increase of $240,000 involves anticipated black spot funding for a roundabout in George Street, Thebarton.

49


General Purpose Grant

The following table and graph shows Council’s general purpose grants from the South Australian Grants Commission since 1997/98. The decline reflects the impact of a methodology review by the Commission.

Grant Year $

1997/98 1,227,343 1998/99 1,120,333 1999/00 1,041,549 2000/01 945,960 2001/02 841,960 2002/03 812,887 2003/04 830,499 2004/05 852,368 2005/06 883,464 2006/07 904,395 2007/08 950,786

2008/09 1,023,275 2009/10 1,042,136 2010/11 1,077,916 2011/12 1,101,163 2012/13 1,132,555 2013/14 1,166,532

User Charges User charges can be distinguished from taxes because they can be avoided by a ratepayer’s decision not to use the good or service in question. The basis for raising general rates from ratepayers is to pay for the goods and services that a local government provides to its

700

900

1,100

1,300

1998 2000 2002 2004 2006 2008 2010 2012

$m

Year Ending 30 June

City of West TorrensGeneral Purpose Grants 1997/98 to 2012/13

50


community. However, there are certain goods and services that the Council provides which are available specifically to individuals or groups and for which a user charge is appropriate. Councils already have a number of user charges e.g. library charges, hall hire, tennis court hire, community centre fees, etc. User charges can help to reduce the rate burden on ratepayers. User charges make a reasonable contribution to the overall budget, and in the 2014/15 financial year a total of $9.08 million is budgeted (or 14.1 per cent of all Council’s income). They comprise the following:

Budget 2013/14


$ $ $

St Martins 7,323,724 7,700,834 377,110 Waste Royalties / Lease Fees 228,820 258,659 29,839 Hall and Theatre Hire / Rent 98,645 219,101 120,456 Brickworks Lease Income 99,093 101,000 1,907 Library Income 55,000 50,000 (5,000) Ovals Rents, Fees & Related 133,918 139,715 5,797 Home Assistance Charges 125,000 100,000 (25,000) House Rent & Related 28,852 32,959 4,107 Sundry User Charges 405,807 478,592 72,785

Total 8,498,859 9,080,860 582,001

All user charges are reviewed annually by Council. Statutory Charges Statutory charges are substantially set by the State Government on regulatory services provided by local government, such as dog registration fees, building and planning fees, and parking fines. They comprise the following:

Budget 2013/14


$ $ $

Parking Income 579,300 669,500 90,200 Development Act Fees 550,000 600,000 50,000 Animal Control Income 224,300 273,500 49,200 Property Search Fees 90,000 100,000 10,000 Sundry Statutory Charges 54,030 59,260 5,230

Total 1,497,630 1,702,260 204,630

51


Statutory fees play an important role in enabling Council to provide a range of specific services and community facilities. However, these fees and charges make a relatively modest contribution to the overall budget. In the 2014/15 budget, statutory charges total $1.702 million or 2.7 per cent of all Council income (excluding capital revenues). The trend since 1997/98 has been as follows:

Other Income

Other income of the Council includes investment income, an insurance bonus and reimbursements, and comprises 1.9 per cent of all income budgeted in 2014/15 (excluding capital revenues).

Budget 2013/14


$ $ $

Investment & Related Income 421,200 435,291 14,091 Reimbursement Income 219,030 209,744 (9,286) Insurance Bonus 270,000 250,000 (20,000) Sundry Income 157,750 98,000 (59,750)

Total 1,067,980 993,035 (74,945)

Loan Program 2014/15 Council’s loan program for 2014/15 totals $1,842,745 ($1,714,000 in the 2013/14 original budget). The loan is to fund Lockleys catchment drainage works.

Historical Perspective on Loans

New loans taken by the Council since 1 July 1987, including those of both Thebarton and West Torrens Councils prior to amalgamation in 1997, are as follows:

52


Year Ended Loans 30th June Taken 1988 280,000 1989 1,151,700 1990 265,000 1991 4,549,390 1992 3,260,000 1993 4,135,600 1994 281,550 1995 2,557,965 1996 500,000 1997 0 1998 0 1999

2000 0 0

2001 2002 2003 2004

0 4,964,000 7,000,000 4,497,337

2005 0 2006

2007 2008 2009 2010 2011 2012 2013

0 3,430,000

0 0 0 0

4,721,455 0

Council has opted for some years now to use cash reserves, rather than borrow, given the margin between borrowing and investment interest rates, and this has reduced the level of indebtedness. Loans taken are shown graphically below:

53


The indebtedness of the Council over the same period has been as follows:

Year Ended Loan 30th June Liability

1988 4,156,370 1989 4,410,644 1990 4,332,500 1991 7,952,591 1992 12,016,976 1993 13,409,421 1994 12,649,808 1995 14,057,519 1996 11,387,771 1997 9,927,527 1998 8,683,170 1999 7,728,295 2000 6,968,412 2001 8,302,536 2002 10,561,826 2003 16,709,425 2004 20,374,509 2005 19,129,976 2006 17,411,955 2007 18,969,367 2008 17,236,975 2009 15,723,125 2010 14,264,992 2011 12,913,277 2012 16,252,653 2013 14,672,077 2014 12,878,229

This is shown graphically as follows:

54


Increased borrowings in the 1991 to 1993 period were largely due to the redevelopment of the Hilton Civic Centre and property acquisitions associated with the Hilton Shopping Centre site.

A sizeable reduction of Council’s indebtedness in the 1995 to 2001 period occurred because Council elected to use cash reserves rather than borrowings to fund the budgeted loan program. This has resulted in interest and principal repayments being avoided.

More recent loans have been taken to finance redevelopment of the Hilton Library, drainage works, Sir Donald Bradman Drive drainage, and other upgrade and general works.

55


56

Operational Budgets by Division

Budget and annual business plan Operational Budgets by Division

57

City Works (including operational property management);

Property Services (including Cummins House).

The Urban Services Division comprises the following:

City Assets (including strategic property management);

Urban Services Division

The Urban Services Division covers a range of service areas responsible for the city's infrastructure as well as the built and natural environment. The division is responsible forthe provision of services and resources that enhance life in the city and it plans, manages and reviews the delivery of Council's works, infrastructure and property.

Urban Services Division

(Angelo Catinari)

City Works City Assets


58


Urban Services Division 2014/15 Business Plan and Budget Statement

Objective(s)

Support Council with the provision of a range of urban services, which aim to maintain and improve the city’s public infrastructure, amenity and built environment.

Key Activities 2014/15

Key activities include the following:

Civil construction and maintenance; Building and property administration and construction; Asset management; Stormwater management; Horticultural services; Fleet management; Traffic management.

Performance Measures

Performance measures, both financial and non-financial, against which the Urban Services Division will be assessed, are:

Projects are completed on time, on budget and with quality outcomes; Stormwater flood mitigation measures are effective throughout the city and meet

community expectations; Asset management plans are in place and support asset maintenance requirements

of the city; Traffic management measures that demonstrate safety improvements while providing

increased levels of community satisfaction; Asset maintenance is timely, cost effective, of a high quality and meets community

expectations; Service frequencies that meet community expectations, including street sweeping

and parks and landscape maintenance; High service levels are maintained and key performance indicators are met.

2014/15 Budget Highlights

1. Income

Roads to recovery funding of $438,839 is budgeted to continue in 2014/15; Council's urban local road grant has again been budgeted at $604,000, based on the

grant received for 2013/14 plus a CPI allowance. Black spot funding of $240,000 has been budgeted for a roundabout in George

Street, Thebarton. Royalty payments and lease income associated with the waste transfer station have

been increased by $29,839 or 13.0 per cent to $258,659. Income from sporting facilities has been increased by $5,797 or 4.3 per cent to

$139,715.

59


Lease income for the Brickworks' site of $101,000 has been budgeted ($99,093 in2013/14).

Depot income of $52,500 has been budgeted which includes $35,000 for maintaininghighway medians for the Department of Planning, Transport and Infrastructure.

2. Operational Expenditure

Employment expenses have increased by $445,842 or 6.0 per cent, to $7,837,918,being impacted by the budgeting of two new rapid response team positions.

Street lighting costs have been budgeted to increase by $37,108 or 4.0 per cent to$957,108 over what was budgeted in 2013/14, although this represents an increaseof 7.7 per cent on the cost expected to be incurred.

Professional fees of $759,000 have been budgeted ($492,000 in 2013/14) andinclude the following:

$150,000 for road and bridge condition audits; $115,000 for the Brown Hill / Keswick Creek project; $92,500 for specialist engineering advice; $50,000 for Council wide stormwater catchment study; $50,000 for West Beach Road design; $50,000 for the development of a master plan and concept design for open

space areas at Kings Reserve and Apex Park; $50,000 to assess remediation requirements for Deeds Road; $45,000 in support of the Glenelg to Adelaide Parklands pipeline project; $40,000 for concept design for a median upgrade of Airport Road; $30,000 for property related fees; $25,000 for tree reports; $20,000 for Lands Titles Office and topographical surveys; $15,000 for local area traffic management; $22,500 in general professional services; $4,000 for geotechnical testing.

Interest expense on infrastructure related loans is budgeted at $561,217, a decreaseof $80,293 or 12.5 per cent.

Levies and charges of $40,500, which includes EPA licence fees for the wastetransfer station, have been budgeted.

Contract maintenance expenditure has increased by $48,240 or 2.4 per cent to$2,056,740 and includes:

$690,000 for property and facilities related maintenance, servicing and cleaning;

$450,000 for road and footpath maintenance; $250,000 for tree pruning; $170,000 for weed control; $185,000 for inspection and cleaning of the drainage network; $125,000 for graffiti removal; $96,000 in waste disposal costs, which includes dealing with illegally dumped

rubbish; $45,000 for irrigation and compliance testing; $45,740 for general contract maintenance.

Material costs for maintenance works have increased by $33,500 or 3.9 per cent to$884,000, and include:

60


A greening program (tree replacement and plantings) of $185,000; Road maintenance and concrete material of $210,000; Line marking and signage of $145,000;

Plant and equipment costs (excluding plant hire and depreciation) are budgeted toincrease by $1,010 or 0.2 per cent to $536,560.

Water rates have been increased by $122,640 or 26.0 per cent to $594,640, inanticipation of increased usage and fee increases occurring. This includes additionalirrigated areas being accommodated.

Staff Numbers

Staff numbers have moved as follows:

2013/14 Budget

2014/15 Budget

Permanent FTE’s 91.7 93.7

Contract / Casual FTE’s 1.9 2.2

Explanation of staffing movement:

2.0 FTE's have been budgeted to establish a rapid response team at the depot. FTE's have otherwise increased by 0.3.

61

2014/15ORIGINAL REVISED DESCRIPTION BUDGET

Income

0 5,500 Statutory Charges 0 0 N/A

840,189 901,396 User Charges 907,626 67,437 8.0%

1,044,339 1,801,428 Grants & Subsidies 1,318,339 274,000 26.2%

207,530 223,126 Reimbursements 202,744 (4,786) -2.3%

0 41,136 Other Income 0 0 N/A

2,092,058 2,972,586 Total Income 2,428,709 336,651 16.1%

Less


6,870,122 6,783,880 Staff Costs 7,307,334 437,212 6.4%

521,954 495,915 Staff Related Costs 530,584 8,630 1.7%

1,969,794 1,829,794 Buildings Furniture & Fittings 1,822,100 (147,694) -7.5%

1,092,499 1,143,499 Plant & Equipment 1,162,690 70,191 6.4%

10,225 10,225 Computer Expenditure 6,700 (3,525) -34.5%

6,549,500 6,757,500 Community Assets 6,960,000 410,500 6.3%

1,359,024 1,586,184 General 1,624,972 265,948 19.6%

641,510 641,510 Bank & Finance 561,217 (80,293) -12.5%

960,500 1,760,500 Council Expenditure 997,608 37,108 3.9%

2,008,500 2,164,755 Contract Expenditure 2,056,740 48,240 2.4%

850,500 680,500 Materials 884,000 33,500 3.9%

1,073,208 1,024,229 Occupancy & Property 1,079,490 6,282 0.6%

(135,400) (68,400) Internal - Expenditure Recovered (58,000) 77,400 -57.2%

23,771,936 24,810,091 Total Operational Costs 24,935,435 1,163,499 4.9%

(21,679,878) (21,837,505) Operational Surplus/(Deficit) (22,506,726) (826,848) 3.8%

BUDGET 2014/15

URBAN SERVICES DIVISION

OPERATIONAL EXPENDITURE & INCOME

VARIATION TO2013/14 ORIGINAL

2013/14 BUDGET


62

St Martins;

− Community Development;− Library;

− Home and Community Care;

City Strategy; City Development.

Strategy and Community Division

Community Services incorporating:

The Strategy and Community Division comprises the following:

The Strategy and Community Division is primarily responsible for land use, building and planning services, the development of policy and the provision of services to the community as approved in Council's strategic directions and annual budget.

Strategy & Community Division

(Declan Moore)

St MartinsCommunity Services

City StrategyCity

Development


63


Strategy and Community Division 2014/15 Business Plan and Budget Statement

Objective(s)

Influence the implementation of departmental strategies that are consistent with theaspirations and principles detailed in Council's Community Plan.

Provide high level strategic policy development and professional advice, on communityand business planning, environmental outcomes and land use planning.

Build stronger relationships between Council and our community, and partnerships withstate and other local governments, to build the social capital of our local community.

Promote reading by making it easy for people of all ages, cultures and interests to getinto reading at all levels and provide free and easy access to information throughcommunity responsive library services.

Coordinate the provision of community based support and services for older people,people with disabilities and their carers, and other specifically funded (external andcouncil) target groups.

Provide fully accredited quality residential aged care services, within a balanced budgetso that operational costs (including depreciation) do not exceed the income receivedfrom resident fees, accommodation bond interest and retentions, and funding from theFederal Government.

Discharge functions and duties, and assist Council and the Development AssessmentPanel to discharge the functions and duties of Council, as a planning authority pursuantto the Development Act 1993 and the Development Regulations 2008.


Key divisional activities are conducted by:

City Strategy, including the coordination of policy, planning and performance of theCommunity Plan;

St Martins, by the provision of residential aged care services; Community Services, including centre based, mobile and home library services;

volunteer, community bus and youth programmes; and home and community careprogrammes that support elderly people stay safely in their own homes;

City Development, including the discharge of functions and duties under theDevelopment Act 1993 and the Development Regulations 2008.


Performance measures, both financial and non-financial, against which the Strategy and Community Division will be assessed, include:

The degree to which Council implements policies, plans, programs, activities andprocedures recommended by the Division;

The degree to which the organisation achieves the objectives and targets set in its keyclimate change adaptation programs;

The performance of St Martins and HACC programs against the independently assessedCommonwealth Accreditation, Validation and Certification standards;

Legal planning obligations are met in an efficient and timely fashion, consistent with theplanning framework and policies of the Council.

64


Financial management of all programs within the budgets set and to the standardsrequired of the funding bodies, including Council itself.


1. Income

Income for St Martins has been budgeted to increase by $461,201 or 6.2 per cent, to$7,956,125;

Accommodation bond income, from retentions and interest earned, is budgeted to be$395,809 ($400,617 in 2013/14). Accommodation bonds are decreasing due to therevised Department of Health and Ageing criteria and more residents being classifiedas high care when in prior years they would have been deemed low care and eligiblefor a bond, combined with expected interest rate decreases, these factors areexpected to reduce income by way of interest.

All but $86,572 or 13.2 per cent of the HACC operational budget is grant or clientfunded ($138,080 or 18.9 per cent in 2013/14);

HACC income is expected to be $570,000, down marginally from $590,663 budgetedin 2013/14. This is due to a reduction in anticipated client income.

A component of the library budget is externally funded by the State Government, andrepresents 14.5 per cent of the total operational budget of the library. This fundingwas reduced in 2013/14, and further reduced in 2014/15, with the amount budgetednow $8,009 or 2.0 per cent lower than that budgeted in 2013/14.

Community Development income is budgeted to increase by $143,337 or 139.2 percent to $246,337, largely due to expected income from the hire of the ThebartonCommunity Centre.

Income of $25,000 has been budgeted for expected sponsorship for the summerfestival events.

Development application fees of $600,000 have been budgeted ($550,000 in2013/14), based on an expected increase in development application numbers;

Property search fees have been budgeted at $100,000, an increase of $10,000 basedon an increase in property sales.


Operational expenditure is budgeted to increase by $363,834 or 2.3 per cent to$15,987,071, incorporating:

- An increase for St Martins of $543,689 or 7.4 per cent to $7,868,218; - A decrease for all other areas of $179,855 or 2.2 per cent to $8,118,853.

Employment expenses have increased by $557,225 or 5.1 per cent, to $11,467,264incorporating:

- An increase for St Martins of $487,428 or 8.8 per cent to $6,053,070; - An increase for all other areas of $69,797 or 1.3 per cent to $5,414,194.

An operational surplus of $87,907 has been budgeted for St Martins in 2014/15($170,395 in 2013/14).

Operational expenditure for the library has decreased by $31,418 or 1.2 per cent, to$2,681,595.

Continuation of an additional $86,000 Council contribution for HACC is included in the2014/15 budget and includes:

65


Socialisation program; 'Healthy Days" the second community meal; "Cooking for Men" classes and bus trips to places of interest and entertainment venues for HACC eligible socially isolated residents;

Gutter cleaning; Emergency and one-off cleaning; Hard waste assistance.

Professional consultant fees have decreased by $67,970 or 27.9 per cent to$175,690, and include $110,000 to fund Development Plan Amendments ($150,000in 2013/14).

A level of cost associated with advertising and publications, including the cost ofTalking Points and the Messenger column, have been transferred from City Strategyto Organisational Support.

Community grants, sponsorships and contributions have increased by $10,000 to$170,300, and include funding for Inner West Business Enterprise Centre (IWBEC),and environmental awards.

$60,000 has again been budgeted to cover building and planning fees that aresubject to a 5 to 8 per cent fee payable to the State Government, along with referralfees and CITB levies.

Partnership grants (Reedbeds, Camden and Western Youth) have been budgeted ata total of $120,000, up $20,000 or 20.0 per cent.

Community development projects and programs have been budgeted at $105,000(partially offset by expected sponsorship income of $25,000) and include:

Summer festival (music, movies and markets in the park); Community art and youth projects; Community gardens; Engagement through information - sessions for the community as a whole,

and some specific topics for youth; After school activities; Disability and volunteer expos.

$75,000 has been allocated for the OPAL program (with $50,000 provided by theState Government and $25,000 by Council as a required contribution).

Security and cleaning cost increases are attributable to the new ThebartonCommunity Centre.

Staff Numbers


2013/14 Budget

2014/15 Budget




2.0 FTE's have been transferred from City Strategy to Organisational Support and one new planning position is proposed. FTE's have otherwise fallen by 0.3.

66


Income

640,000 683,000 Statutory Charges 700,000 60,000 9.4%

7,559,349 7,737,593 User Charges 8,025,834 466,485 6.2%

941,135 992,990 Grants & Subsidies 960,800 19,665 2.1%

1,500 11,930 Reimbursements 1,500 0 0.0%

171,200 262,012 Other Income 255,291 84,091 49.1%

9,313,184 9,687,525 Total Income 9,943,425 630,241 6.8%

Less


10,326,708 10,439,825 Staff Costs 10,895,930 569,222 5.5%

583,329 558,429 Staff Related Costs 571,334 (11,995) -2.1%

627,626 605,322 Buildings Furniture & Fittings 623,662 (3,964) -0.6%

190,159 187,154 Plant & Equipment 175,580 (14,579) -7.7%

118,377 126,790 Computer Expenditure 157,000 38,623 32.6%

347,000 347,000 Community Assets 304,300 (42,700) -12.3%

2,146,629 1,951,152 General 1,847,096 (299,533) -14.0%

302,267 295,824 Bank & Finance 273,449 (28,818) -9.5%

343,550 315,869 Council Expenditure 374,629 31,079 9.0%

200,012 198,102 Contract Expenditure 194,135 (5,877) -2.9%

32,850 44,760 Materials 45,667 12,817 39.0%

404,729 523,853 Occupancy & Property 524,289 119,560 29.5%

15,623,237 15,594,081 Total Operational Costs 15,987,071 363,834 2.3%

(6,310,053) (5,906,556) Operational Surplus/(Deficit) (6,043,646) 266,407 -4.2%

BUDGET 2014/15

STRATEGY & COMMUNITY SERVICES DIVISION



2013/14 BUDGET


67

The Mendelson Foundation; Information Services; Regulatory Services; Waste; HR and Service Centre.

Corporate & Regulatory Division

The Corporate and Regulatory Division comprises the following:

Financial Services;

The Corporate and Regulatory Division is responsible for the provision of a range of support services across Council and the provision of operational support to the Chief Executive Officer.

Corporate & Regulatory Division

(Bill Ross)

Financial Services

Information Services

Regulatory Services

HR & Service Centre

Max & Bette Mendelson Foundation


68


Corporate and Regulatory Division 2014/15 Business Plan and Budget Statement

Objective(s)

Support Council with the provision of corporate services, including financial, human resource management and information services, and deliver effective and efficient waste, environmental health, compliance, call centre and counter services to the community.



Finance; Human resource management; Counter and call centre services; Information technology (IT); Information management; Compliance and environmental health services; Waste management; Mendelson Foundation administration.


Performance measures, both financial and non-financial, against which the Corporate and Regulatory Division will be assessed, are:

The achievement of quality outcomes for the benefit of both Council and the WestTorrens’ community;

City of West Torrens remains financially sustainable as an entity; The delivery of a high level of financial accountability; Compliance with all relevant legislation and regulations; High level support in human resource management is provided; Quality work health and safety outcomes are achieved; High standards of counter and call centre service are maintained; A high level of IT network and application availability occurs; A policing presence is maintained within the community in parking administration,

animal management and general compliance operations; Quality immunisation outcomes are achieved; Waste to landfill is reduced and recycling increased; Ongoing success is achieved with food waste recycling and illegal dumping

programs; Prudent management of Mendelson Foundation investments occurs.


1. Income

Rates have been budgeted to increase by 4.0 per cent, based on the calculation thatfollows. This represents an increase in income from rates of $2,230,863 over whatwas raised in 2013/14.

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$ Rate Income 2013/14 41,759,137 Add Natural Growth at 1.3% 542,869 Sub Total 42,302,006

Add Rate Increase at 4.0% 1,687,994

Total 43,990,000

Rate equivalent payments for Adelaide Airport have increased to $4,320,000, basedon growth of 1.3 per cent and a 4.0 per cent increase, as follows:

$ Net REP's in 2013/14 4,099,544

Add growth at 1.3% 53,294 Add increase at 4.0% 167,162 Total 4,320,000

Income from investments has been reduced to $165,000, based on cash flowprojections and lower interest rates (a reduction of $55,000 or 25.0 per cent).

Council’s financial assistance grant is budgeted to increase by $30,468 or 2.6 percent to $1,197,000 when compared to the original budget in 2013/14.

Parking and related fees are being increased by $90,200 or 15.6 per cent to$669,500 over what was originally budgeted in 2013/14.

Dog registration fees have been increased by $37,300 or 18.6 per cent to $238,000,reflecting revised charges endorsed by Council.

Environmental health subsidy income has decreased by $6,360 or 5.5 per cent to$109,960, reflecting a decrease in vaccinations to school children.


An increase of $80,000 or 2.6 per cent (from $3,060,000 to $3,140,000) has beenbudgeted for waste collection.

The waste collection budget amount of $3,140,000 includes allowance for thefollowing:

$ Hard waste / mattress collection 310,000 Hazardous waste collection 25,000 Mattresses 40,000 E-waste collection 10,000 Vouchers - 6 x 4 trailer 35,000 Total 420,000

Waste to landfill costs have been decreased by $140,000 or 11.3 per cent to$1,100,000, largely because the carbon tax is no longer being budgeted.

An amount of $75,000 has been budgeted to maintain Council’s program to reduceillegal dumping.

The budget for rate rebates and remissions for 2014/15 totals $765,000, an increaseof $50,000 or 7.0 per cent above the 2013/14 budget, reflecting proposed rateincreases and an anticipated increase in rebate numbers.

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Valuation charges of the Valuer-General have been budgeted to fall by $10,000 or4.8 per cent to $200,000.

Bank and finance charges have been budgeted to increase by $5,000 or 3.8 per centto $135,500 over what was budgeted in 2013/14.

No early payment discount has been budgeted (discontinued in 2013/14). The budget for software has increased by $30,000 or 5.0 per cent to $630,000,

largely due to proposed spending on GIS for public access. Computer hardware costs have been reduced from $245,000 to $55,000 following

changes to leasing arrangements, but this reduction is offset by increased capitalbudget costs.

The minor capital budget has been increased from $8,000 to $60,000 to cover theplanned expenditure on equipment for Elected Members after the November localgovernment elections.

Staff Numbers


2013/14 Budget

2014/15 Budget




One FTE position (in lean thinking) has been transferred to Organisational Support and a 0.5 trainee position in Council's Service Centre has been discontinued. A nominal reduction of contract / casual FTE's has also occurred.

71


Income

46,308,422 46,410,966 Rates 48,856,695 2,548,273 5.5%

857,630 1,012,428 Statutory Charges 1,002,060 144,430 16.8%

88,117 140,307 User Charges 135,900 47,783 54.2%

1,222,222 612,168 Grants & Subsidies 1,197,000 (25,222) -2.1%

1,000 84,406 Reimbursements 81,000 80,000 8000.0%

772,750 856,925 Other Income 528,000 (244,750) -31.7%

49,250,141 49,117,200 Total Income 51,800,655 2,550,514 5.2%

Less


4,698,419 4,608,347 Staff Costs 4,762,672 64,253 1.4%

449,816 454,760 Staff Related Costs 450,361 545 0.1%


122,674 117,674 Plant & Equipment 123,400 726 0.6%

1,014,576 998,482 Computer Expenditure 892,200 (122,376) -12.1%

722,031 754,348 General 848,147 126,116 17.5%

150,846 152,778 Bank & Finance 153,384 2,538 1.7%

1,486,838 1,484,338 Council Expenditure 1,493,715 6,877 0.5%

4,507,565 4,244,565 Contract Expenditure 4,470,150 (37,415) -0.8%

66,590 66,590 Occupancy & Property 58,500 (8,090) -12.1%


35,998,716 36,196,548 Operational Surplus/(Deficit) 38,532,836 2,534,120 7.0%

BUDGET 2014/15

CORPORATE & REGULATORY DIVISION



2013/14 BUDGET


72

Elected Council; Office of the Chief Executive Officer.

Governance and Internal Audit; Media & Events; Procurement; Continuous Improvement Program.

City Management and Organisational

Support Divisions

The City Management Division is responsible for the provision of a range of services to elected representatives, the community and staff of the Council.

The City Management Division comprises the following:

The Organisational Support Division is responsible for the delivery of a range of corporate support responsibilities, including the provision of services and resources in:

City Management Division

(Terry Buss)

Elected Council

OrganisationalSupport Division

(Pauline Koritsa)

Governance & Internal Audit

Continuous Improvement

Media & Events Procurement

Office of the CEO


73


City Management and Organisational Support Divisions 2014/15 Business Plan and Budget Statement

Objective(s)

The objectives of the Elected Council, the Office of the Chief Executive Officer (CEO) and the Organisational Support Division are to:

Make responsible and informed decisions in the interests of the community; Manage Council operations and the provision of public services and facilities; Exercise, perform and discharge the powers, functions and duties of local

government under the Local Government Act and other related legislation; Represent the interests of the West Torrens’ community;

Encourage and develop community initiatives in order to improve the quality of life forresidents;

Deliver high quality media, events and lean thinking programs; Achieve excellence in governance, internal audit, risk management and procurement.



Office of the CEO; Business of the Elected Council; Governance; Procurement; Risk management; Media and events; Lean thinking; Internal audit.


Performance measures, both financial and non-financial, against which the Office of the CEO, Council and Organisational Support will be assessed, are:

Compliance with legislative requirements; Observance of Council policy; Evidence of the Council working within a strategic planning framework; Proper discharge of powers, functions and duties under the Local Government Act

and other related legislation; Evidence of timely and responsible decision making; Evidence that Council decisions are implemented without undue delay; Evidence of open, responsible and accountable government; Evidence that the assets and resources of the Council are properly managed and

maintained; Evidence that an appropriate organisational structure for the Council is established

and maintained; Attendance at Council meetings, workshops and community forums; Active representation of community interests; Positive feedback from the community;

74


Positive media; Responsible management of Council services to the community; Unqualified audit report; Successful completion of the 2014 Council election process; Evidence of steps being taken in relation to sustainable development and the

protection of the environment; Effective internal audit programs are delivered; Full and timely compliance occurs with freedom of information requirements; Organisational and strategic risks are effectively managed; The lean thinking program delivers meaningful continuous improvement; Completion of stages one and two of the procurement roadmap program.


1. Income

Income is budgeted to decline by $4,004 or 19.8 per cent to $16,200, reflecting anexpected fall in reimbursement income, largely travel related.


Operational expenditure is budgeted to increase by $708,792 or 28.0 per cent to$3,236,879, largely because of staffing movements and other changes explainedbelow.

Annual subscription payments to the LGA, AMAC and the Murray Darling Associationtotalling $82,500 have been budgeted, an increase of $2,500 or 3.1 per cent;

External audit support of $62,000 is proposed ($60,000 in 2013/14), which includestwo legal compliance audits.

Additional costs associated with the local government elections in November 2014 of$168,500 are being budgeted.

Publications and printing costs of $79,000 are proposed, including $46,000 forTalking Points.

Advertising and publicity costs of $68,700 are budgeted, including $45,600 for theMessenger column.

Legal costs are substantially budgeted in City Management, and they have beenincreased by $7,000 or 3.5 per cent to $207,000.

Allowances for elected and Audit and Risk Committee members of $413,445 havebeen budgeted, based on allowances adopted by Council and increases anticipatedin November 2014 ($400,929 in 2013/14).

Donations, awards and contributions include $15,000 for Mendelson Foundationscholarships.

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Staff Numbers


2013/14 Budget

2014/15 Budget




One FTE from Information Services (Lean Thinking Program Leader) and two FTE's from City Strategy (Media and Events Team Leader and Communication Officer) have been transferred to Organisational Services. FTE's in City Management also increased by 0.5 because a restructuring of support arrangements expected in 2013/14 did not occur. A nominal reduction of 0.1 FTE otherwise occurred.

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Income

0 1,500 Statutory Charges 200 200 N/A

11,204 11,204 User Charges 11,500 296 2.6%

9,000 12,364 Reimbursements 4,500 (4,500) -50.0%

20,204 25,068 Total Income 16,200 (4,004) -19.8%

Less


1,194,512 1,402,966 Staff Costs 1,569,733 375,221 31.4%

125,711 148,186 Staff Related Costs 143,601 17,890 14.2%


28,817 28,817 Plant & Equipment 27,770 (1,047) -3.6%

1,374 1,374 Computer Expenditure 1,100 (274) -19.9%

708,898 922,488 General 1,031,950 323,052 45.6%

439,929 419,929 Council Expenditure 438,445 (1,484) -0.3%

15,359 15,359 Occupancy & Property 14,600 (759) -4.9%


(2,507,883) (2,927,538) Operational Surplus/(Deficit) (3,220,679) (712,796) 28.4%

2013/14 ORIGINAL

BUDGET 2014/15

CITY MANAGEMENT & ORGANISATIONAL SUPPORT DIVISIONS


2013/14 BUDGET VARIATION TO


77


78

Rating

Budget and annual business plan Rating

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Introduction

The City of West Torrens uses capital values as the basis for valuing land within its Council area, with valuations purchased from the Valuer-General on an annual basis and adopted by Council for its use. Council currently adopts a rate in the dollar to apply against each separate valuation to arrive at a property levy (rate).

This simple formula is adjusted by the application of a minimum rate set by Council each year to ensure that all property owners contribute to the cost of services and the maintenance of infrastructure that supports each property. It should be noted that a council cannot apply the minimum rate to more than 35 per cent of properties within its area.

Rate in the Dollar

To determine the amount of rates paid, and in order to share the costs, Council uses a formula that is based on property values as required under the Local Government Act. This formula divides the total amount the Council needs to raise from rates by the total value of all properties in the Council area:

Total rate revenue required = rate in the dollar Total value of ratable properties

The determination of a rate in the dollar provides a mechanism to avoid a windfall gain from changes in property values.

The Amount of Rates Levied

Council uses the following formula to determine the amount of rates levied on each property.

Capital value of property multiplied by the rate in $ = rate levied (subject to minimum rate).

Example 1 - Residential (based on previous year data)

Capital Value = $400,000 Rate in the Dollar = 0.00256242 Minimum Rate = $794.00 Rates = Capital Value * Rate in the Dollar

Rates = $400,000 * 0.00256242 = $1,024.95

As this amount is greater than the minimum rate, the rate applied by Council remains at $1,024.95.

Example 2 - Residential with an Adjustment for the Minimum Rate

Capital Value = $200,000 Rate in the Dollar = 0.00256242 Minimum Rate = $794.00 Rates = Capital Value * Rate in the Dollar

Rates = $200,000 * 0.00256242 = $512.45

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This is below the minimum rate (of $794.00) and must therefore be adjusted:

Rates = $512.45 + Adjustment = $512.45 + $281.55 = $794.00

The rates are adjusted up by $281.55 and set by Council at the minimum rate of $794.00.

Council set the minimum rate on 27 per cent of all residential properties in 2013/14 and all were valued at less than $309,870.

Rating Principles

There are five principles that apply to the imposition of taxes on communities. These principles are:

Equity - taxpayers with the same income should pay the same tax (horizontalequity), while wealthier taxpayers pay more (vertical equity);

Benefit - taxpayers should receive some benefits from paying tax, but notnecessarily to the extent of the tax paid;

Ability-to-pay - in levying taxes, the ability of the taxpayer to pay the tax must betaken into account;

Efficiency - if a tax is designed to change consumers’ behaviour and thatbehaviour changes, then the tax is efficient (eg: tobacco taxes). If the tax isdesigned to be neutral in its effect on taxpayers, but it changes that behaviour,then the tax is inefficient; and

Simplicity - the tax must be understandable, hard to avoid and easy to collect.

To some extent these principles are in conflict with each other. Governments must therefore strike a balance between the:

Application of the principles; Policy objectives of taxation; Need to raise revenue; and Effects of the tax on the community.

Council has considered each principle when reviewing the various rating options available.

Alternative Options

There are a number of alternative rating options available under the Local Government Act 1999, including:

Capital versus site valuation; Differential rating; Rating without a minimum rate; Application and impact of the minimum rate; Impact of reducing the minimum rate; Fixed charges; Service rate or charge; and Rate capping.

81


Capital Versus Site Valuation Local government may adopt one of three valuation methodologies to value the properties in its area. They are:

Capital Value (CV) – the value of the land and all the improvements on the land; Site Value (SV) – the value of the land and any improvements which permanently

affect the amenity of use of the land, such as drainage works, but excluding the value of buildings and other improvements;

Annual Value (AAV) – a valuation of the rental potential of the property.

Capital values have been adopted by Council as its valuation method for rating purposes because this is considered the fairest approach, based on the ability-to-pay principle, with the owners of higher value properties paying higher rates and the owners of lower value properties paying lower rates. How might this work in practice? Consider two adjoining properties in a particular council area. Property A is a quarter acre block with a four bedroom house, in ground pool and well developed garden. Property B is a quarter acre block with a three bedroom house and average garden. The following valuations might apply to the two properties:

What rates would be paid by the two property owners under the different valuations? Excluding minimum rates or a fixed charge, the tax burden would fall as follows:

Under Capital Value, the owner of Property A would pay 50 per cent more than the

owner of Property B; Under Site Value, the two property owners would pay the same; and Under Annual Value, the owner of Property A would pay 20 per cent more than the

owner of Property B.

Which is the fairer valuation system?

In the local government rating context, the high level assumption is that people with more expensive homes are better off than people with less expensive homes and that they have the capacity to shoulder more of the rate burden. However, pensioner concession, rebate and remission provisions and the ability of councils to tailor payments and make other administrative arrangements, recognises that some ratepayers need special consideration. Council is also mindful of the impact and implications of changing to an alternative valuation method.

Property A Property B

Capital Value $600,000 $400,000

Site Value $200,000 $200,000

Annual Value $36,000 $30,000

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Differential Rating The Local Government Act allows councils to differentiate rates based on the use of the land, the locality of the land, or the use and locality of the land. Definitions of the use of the land are prescribed by regulation and the current definitions are:

Residential Commercial – Shops Commercial – Office Commercial – Other Industrial – Light Industrial – Other Primary Production Vacant Land Other

A significant majority of South Australian councils use differential rates. West Torrens Council uses two different rates with expected income compared to last year being as follows: Land Use Budgeted Income Budgeted Income 2013/14 2014/15 $m $m

Residential 27.28 28.70 Non-residential 14.52 15.29 In 2013/14 West Torrens Council had the third highest differential between residential and commercial / industrial properties in the metropolitan area, as follows:

Council Commercial Industrial

Playford 6.9 6.9 Charles Sturt 2.9 4.0 West Torrens 2.3 2.3

Pt Adelaide Enfield 2.1 2.1 Prospect 1.9 1.9 Mitcham 1.9 1.9 Unley 1.8 1.8 Marion 1.8 1.6 Walkerville 1.5 1.5 Holdfast Bay 1.4 1.4 Salisbury 1.4 1.4 Tea Tree Gully 1.4 1.4 Onkaparinga 1.3 1.3 Norwood, Payneham 1.2 1.2 Adelaide Hills 1.0 1.1 Burnside 1.0 1.0 Campbelltown 1.0 1.0 Average 1.8 1.9

Source: LGA Survey

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Charging a differential rate can be justified on the grounds that commercial and industrial users consume a greater proportion of council resources than residential properties, particularly in regard to the use of roads, traffic, parking, stormwater, etc. The maintenance of city roads, bridges and kerbing infrastructure requires significant planning time and funding from Council. Heavy vehicle movements e.g. semi-trailers, trucks, vans and light commercial vehicles impact on the life of road infrastructure placing an increased burden on the community (ratepayers). Footpaths and walkways are another area, which require ongoing improvement and maintenance by Council, concentrating on high pedestrian traffic areas such as retail and commercial zones. In addition many of the studies and installations required for effective traffic management and control, result from heavy traffic load generated by commercial and industrial zones. Commercial and industrial properties, because of large buildings and covered ground for car parking, generate a high percentage of the stormwater volume carried by West Torrens’s drainage system. Businesses, and in particular industries, are also responsible for many of the gross pollutants that contaminate stormwater and degrade our environment. Council both maintains the stormwater drainage network and works with businesses to lessen the negative environmental effects of their activities. A higher differential rate on vacant land discourages withholding land from development.

A differential rating system provides Council with more tools to moderate large movements in valuations that occur periodically in the market.

Without a Minimum Rate This system is based on the premise of a single rate in the dollar, with all properties paying a rate based directly on the capital value of the property. The City of West Torrens has one of the lowest minimum rates in metropolitan Adelaide and it would be difficult to justify its removal. 95 per cent of minimum rated properties are flats or units, and a majority, possibly up to 80 per cent, are not owner-occupied. Only 8 per cent of minimum rated properties involve a pensioner concession, which is below the all property average of 20 per cent.

Application and Impact of the Minimum Rate The Local Government Act allows councils to impose a minimum rate, which must not apply to more than 35 per cent of rateable properties. Only one minimum rate can be imposed on two or more adjoining properties with the same owner. A minimum rate cannot be used in conjunction with a fixed charge. The argument in favour of the minimum rate is that in terms of the benefits received by all ratepayers it is appropriate that every ratepayer make a minimum contribution to the cost of the services provided.

Fixed Charge Under this system a fixed amount is first applied evenly against all ratepayers and the minimum rate is abolished. The only restriction under new Local Government Act provisions is that the rates generated by a fixed charge cannot exceed 50 per cent of all rates revenue

84


raised. The fixed charge may be set at a level designed to ensure everyone pays a fair share of services, with the remaining amount of rate revenue based on the valuation of the property. The introduction of a fixed charge is not favoured as it benefits owners of higher valued property, arguably the more fortunate within our community, and its adverse impacts on large numbers of owners of lower valued property. Service Rate or Charge Council could apply a service rate, say $150.00 for waste management, in addition to raising general rates. Unlike fixed charge arrangements, the minimum rate is not abolished and the rate can only be based on the nature of the service, the level of usage of the service or a combination of the two.

The introduction of a service rate or charge is not favoured because of its adverse impact on the owners of low valued property and the less fortunate within our community. Rate Capping Rate capping can be used by Council to limit the magnitude of any rate increase affecting any one ratepayer to a certain percentage in any one year. Capping has its limitations, but can be used to moderate irregular rate increases brought about by irregular valuation movements. Initial valuations provided for 2014 by the Valuer-General indicate residential property value movements within the West Torrens Council area are as follows:

No. of Average Increase / Increase / Suburb Assessments CV (Decrease) (Decrease) $ %

Keswick 334 346,317 -638 (0.2) West Richmond 426 348,911 675 0.2 Thebarton 653 377,677 870 0.2 Brooklyn Park 1,970 374,780 1,267 0.3 North Plympton 1,259 381,624 1,336 0.4 Kurralta Park 1,263 348,709 1,602 0.5 Marleston 780 352,356 1,631 0.5 Netley 742 378,442 1,757 0.5 Torrensville 1,730 424,337 2,280 0.5 Lockleys 2,248 512,375 4,931 1.0 Mile End South 12 338,750 4,583 1.4 Camden Park 1,461 350,762 4,829 1.4 Underdale 1,002 432,994 6,458 1.5 Fulham 1,134 484,011 7,534 1.6 Mile End 1,939 433,235 6,923 1.6

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Glandore 502 460,070 7,824 1.7 Hilton 368 396,011 6,805 1.7 Ashford 447 412,814 7,351 1.8 Cowandilla 542 392,845 8,023 2.1 Plympton 2,198 358,948 7,374 2.1 Novar Gardens 874 498,450 10,612 2.2 West Beach 742 507,028 11,602 2.3 Glenelg North 418 455,187 13,413 3.0 Richmond 1,419 381,351 12,787 3.5 Total 24,463 411,125 5,395 1.3

Valuations increased by 1.3 per cent on average in 2014, ranging from an increase of 3.5 per cent in Richmond to a reduction of 0.2 per cent in Keswick. Movements in prior years ranged from:

A reduction of 1.4 per cent in Mile End South to an increase of 4.2 per cent in Thebarton (2013);

Reductions of 3.2 per cent in Ashford to 7.0 per cent in West Richmond (2012); and Increases of 10.2 per cent in Keswick to 1.2 per cent in Mile End South (2011);

Capping makes the tax system more complex and less understandable for ratepayers, and this has some effect on the simplicity principle. Rate capping has not enjoyed much favour in past years, probably because of the way it compromises the rating process and it is not proposed in 2014/15. Postponement of Rates for Seniors

Rate postponement for seniors is now mandatory in certain circumstances following amendments to the Local Government Act 1999 and the Local Government (General) Regulations 1999. These changes mandate an entitlement to postponement where:

The ratepayer holds a state seniors card or has an application pending where an

entitlement exists; The property in question is the principal place of residence; and The property is owned by the principal ratepayer or the principal ratepayer and their

spouse. This legislation is available at www.legislation.sa.gov.au. Information can be obtained about Council’s administration of these provisions by contacting Council’s Service Centre on 8416 6333 or by emailing [email protected].

Rate postponement has been available to senior West Torrens Council residents since July 2007, but only three applications have been received, despite publicity about its availability. Other councils that offer policy support for the postponement of rates have likewise experienced few applications for support.

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http://www.legislation.sa.gov.au/

mailto:[email protected]


Rate Rebates and Remissions

Chapter 10 of the Local Government Act 1999 (the Act) provides Council with authority to grant the following:

Mandatory and discretionary rebates of rates to a person or body (Division 5,Sections 159 to 166 of the Act); and

Rate remissions (Division 9, Section 182 of the Act).

Council policy Rate Rebates and Remissions clarifies requirements in the administration of these provisions. It is available on Council’s web-site at www.westtorrens.sa.gov.au, or a copy can be obtained by contacting Council’s Service Centre on 8416 6333 or by emailing [email protected]. It deals in detail with:

Discretionary rebates, in particular what is taken into account in determiningapplications and rebate amounts;

The approach taken in deciding vacant land rebates, including rebate amounts; Rate remissions available when Council is satisfied on the application of a ratepayer

that payment would cause hardship; The approach taken in deciding mandatory rebates, including increases from 75 per

cent to 100 per cent of the rates payable; and How to go about applying for a rebate or remission.

Proposed Rate Model

The proposed rate model for 2014/15 is shown on the page following.

87

http://www.westtorrens.sa.gov.au/

mailto:[email protected]

RATE MODEL RESULTS 2014-2015

Capital Value @ 4.0% Increase MINIMUM = $826.00 2 RATES

CODE No. PROP INCOME PROP NATURAL RATE ACTUAL VARIATION2014/2015 2013/2014 ON INCREASE IN INCOME PERCENT

MIN + REDISTRIB DOLLAR PER MODEL

RESIDENTIAL

1 26,667 $27,279,874 7420 $27,577,866.61 0.00264909 28,694,767.05

26667 $27,279,874 7420 $27,577,866.61 $28,694,767.05 4.0%

NON-RESIDENTIAL

2 872 $3,751,284 103 $3,660,277.79 0.00603319 $3,805,246.65

3 332 $1,649,446 93 $1,634,674.74 0.00603319 $1,699,619.85

4 915 $4,926,022 57 $4,985,250.05 0.00603319 $5,199,040.05

5 106 $401,718 10 $405,834.65 0.00603319 $421,891.35

6 233 $2,172,969 3 $2,193,380.75 0.00603319 $2,297,407.50

7 5 $20,199 2 $20,198.70 0.00603319 $20,970.20

8 285 $529,468 0 $602,960.03 0.00603319 $616,522.05

9 134 $1,020,791 1 $1,019,046.88 0.00603319 $1,049,040.00

2,882 $14,471,896 269 $14,521,623.59 $15,109,737.65 4.0%

Shortfall $185,495.30

TOTAL 29,549 $41,751,770 7,689 $42,099,490.20 $43,990,000.00

MINIMUM % 26.0%

Natural Resources Management Levy Required Actual

NRML $1,176,374.15 $1,210,573.00 0.00009588 $1,210,531.00

Less rebates ($14,000.00) ($14,000.00) ($14,000.00)

$1,162,374.15 $1,196,573.00 $1,196,531.00


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Summary Financial Statements

Budget and annual business plan Summary Financial Statements

89

OriginalBudget2013/14

Original

Budget

2014/15

$'000 $'000

ASSETS

Current Assets

Cash and cash equivalents 1,132 3,898

Trade and other receivables 3,021 4,778

Other financial assets 957 1,011

Inventories 11 11

5,121 9,698

Non-current assets held for sale - -

Total Current Assets 5,121 9,698

Non-Current Assets

Financial assets 7 -

Infrastructure, property, plant and equipment 578,965 591,052

Other non-current assets - work in progress 3,507 7,704

Total Non-Current Assets 582,479 598,756

Total Assets 587,600 608,454

LIABILITIES

Current Liabilities

Trade and other payables 5,814 8,990

Borrowings 1,912 2,195

Provisions 2,209 2,143

Aged care facility deposits 15,622 15,715

Total Current Liabilities 25,557 29,043

Non-Current Liabilities

Borrowings 14,930 12,484

Provisions 273 364

Total Non-Current Liabilities 15,203 12,848

Total Liabilities 40,760 41,891

NET ASSETS 546,840 566,563

EQUITY

Accumulated Surplus 40,520 44,805

Asset Revaluation Reserves 501,150 511,652

Other Reserves 5,169 10,107

TOTAL EQUITY 546,840 566,563

City Of West Torrens

STATEMENT OF FINANCIAL POSITION

as at 30 June 2015

90

BUDGETED STATEMENT OF COMPREHENSIVE INCOME


Original

Budget

2014/15$'000 $'000

INCOME

Rates 46,403 48,937

Statutory charges 1,498 1,702

User charges 8,499 9,081

Grants, subsidies and contributions 3,208 3,476

Investment income 421 415

Reimbursements 219 210

Other income 428 368

Total Income 60,676 64,189

EXPENSES

Employee costs 24,771 26,232

Materials, contracts & other expenses 19,324 19,873

Depreciation, amortisation & impairment 10,125 10,479

Finance costs 955 844

Total Expenses 55,175 57,427

OPERATING SURPLUS / (DEFICIT) 5,501 6,762

Asset disposal & fair value adjustments - -

Amounts received specifically for new / upgraded assets - -

Physical resources received free of charge - -

NET SURPLUS / (DEFICIT)

transferred to Equity Statement5,501 6,762

Other Comprehensive Income - -

TOTAL COMPREHENSIVE INCOME 5,501 6,762

for the year ended 30 June 2015


91

Original Budget 2013/14

Original

Budget

2014/15$'000 $'000

CASH FLOWS FROM OPERATING ACTIVITIES

Receipts Operating receipts 60,254 63,774

Investment receipts 421 415

Payments Operating payments to suppliers and employees (43,961) (46,045)

Finance payments (957) (844)

Net Cash provided by (or used in) Operating

Activities 15,758 17,300

CASH FLOWS FROM INVESTING ACTIVITIES

ReceiptsAmounts specifically for new or upgraded assets - -

Sale of replaced assets 992 420

Sale of surplus assets 750 8,381

Repayments of loans by community groups 7 7

PaymentsExpenditure on renewal / replacement of assets (10,737) (10,110)

Expenditure on new / upgraded assets (7,530) (9,392)

Net Cash provided by (or used in) Investing

Activities (16,517) (10,693)

CASH FLOWS FROM FINANCING ACTIVITIES

Receipts Proceeds from borrowings 1,714 1,843

Proceeds from aged care facility deposits 1,500 2,000

Payments Repayments of borrowings (1,794) (1,912)

Repayment of Finance Lease Liabilities - (157)

Repayment of aged care facility deposits (3,000) (3,000)

Net Cash provided by (or used in) Financing

Activities(1,580) (1,226)

Net Increase (Decrease) in cash held (2,339) 5,381

Cash and cash equivalents at beginning of period 3,471 (1,483)

Cash and cash equivalents at end of period 1,132 3,898


BUDGETED CASH FLOW STATEMENT


92


Accumulated

Surplus

Asset

Revaluation

Reserve

Other

Reserves

TOTAL

EQUITY

$'000 $'000 $'000 $'000

Original Budget 2013/14

Balance at end of previous reporting period 34,124 501,150 6,064 541,339 Net Surplus / (Deficit) for Year 5,501 5,501 Other Comprehensive Income

Transfers between reserves 895 (895) - Balance at end of period 40,520 501,150 5,169 546,840

Next Year Budget 2014/15

Balance at end of previous reporting period 44,664 511,652 3,486 559,802 Net Surplus / (Deficit) for Year 6,762 6,762 Other Comprehensive Income

Transfers between reserves (6,621) - 6,621 - Balance at end of period 44,805 511,652 10,107 566,564


BUDGETED STATEMENT OF CHANGES IN EQUITY

93


Original

Budget

2014/15

Operating Surplus Ratio

Operating surplus 12% 14%Rates - general and other less NRM levy

Net Financial Liabilities Ratio

Net financial liabilities 60% 51%Total operating revenue less NRM levy

Asset Sustainability Ratio

Net asset renewals 103% 104%Depreciation expense

These financial indicators have been calculated in accordance with Information Paper9 - Local Government Financial Indicators prepared as part of the LGA FinancialSustainability Program for the Local Government Association of South Australia.


BUDGETED FINANCIAL INDICATORS


This ratio expresses the operating surplus as a percentage of general and other rates, net

of NRM levy.

Net financial liabilities are defined as total liabilities less financial assets (excluding equity

accounted investments in Council businesses). These are expressed as a percentage of

total operating revenue (excluding NRM levy).

Net asset renewals expenditure is defined as net capital expenditure on the renewal and

replacement of existing assets, and excludes new capital expenditure on the acquisition of

additional assets.

94

Income 60,676 64,189

less Expenses 55,175 57,427

Operating Surplus / (Deficit) 5,501 6,762

less Net Outlays on Existing Assets

Capital expenditure on renew / replacement of existing assets 11,466 10,906

less Depreciation, amortisation and impairment 10,125 10,479

less Proceeds from sale of replaced assets 992 420

349 7

less Net Outlays on New and Upgraded Assets

Capital expenditure on new and upgraded assets 7,901 10,054

less Amounts received specifically for new / upgraded assets - -

less Proceeds from sale of surplus assets 750 8,381

7,151 1,673

Net Lending / (Borrowing) for Financial Year (1,999) 5,082


BUDGETED UNIFORM PRESENTATION OF FINANCES


The following is a high level summary of both operating and capital investment activities ofthe Council prepared on a simplified Uniform Presentation Framework basis.

All Councils in South Australia have agreed to summarise annual budgets and long-termfinancial plans on the same basis.

The arrangements ensure that all Councils provide a common 'core' of financialinformation, which enables meaningful comparisons of each Council's finances.


$'000

Original

Budget

2014/15

$'000

95

Budget and annual business plan Summary Financial Statements

96

Ten Year Financial Plan

Budget and annual business plan Ten Year Financial Plan

97


98

CITY OF WEST TORRENS

FORWARD ESTIMATES FOR 10 YEARS TO 2023/24

KEY ASSUMPTIONS

Income Expenditure - Operational & Maintenance

Rate Increase 2014/15 4.0% + growth Wages Growth - St Martins 8.8% Based on expectation - 2014/15

REP Increase 2014/15 4.0% Wages Growth - Other 5.1% Based on expectation - 2014/15

Rate Growth - 2014/15 1.30% Wages Growth - St Martins 4.0% Based on expectation - 2015/16

REP Growth - 2014/15 1.30% Wages Growth - Other 4.0% Based on expectation - 2015/16

Rate Increases 2015/16 4.3% + growth in all years Wages Growth - St Martins 4.0% Based on expectation - 2016/17

Rate Growth - All Other Years 1.3% Wages Growth - Other 4.0% Based on expectation - 2016/17

REP Increases 2015/16 4.3% Same as rate increases Waste Contract - Solo 3.0% Fuel impact + extra services

Rate Equivalent Growth 1.0% Cumulative increase Waste Disposal 2014/15 4.0% Allowance for solid waste levy

Rate Increases from 2016/17 4.3% + growth in all years Waste Disposal Otherwise 4.0% Allowance for modest levy increases

Revenue Growth - Parking 3.0% Contract Works 4.0%

Revenue Growth - Animals 3.0% Works Materials 3.0%

Revenue Growth - Dev Apps 3.0% Other Finance Charges 3.5% Banks + more activity

Revenue Growth - Waste 3.0% Depreciation - Buildings 3.0% Allowance for new assets

W/Comp Refund 1.5% Depreciation - Infrastructure 3.0% Allowance made for new assets

Revenue Growth - Other 3.0% Other - cumulative increase Depreciation Other 3.0%

NRM Levy from 2015/16 3.0% Plant Costs 3.0%

Roads to Recovery - Funding to continue until 2019/20 Computer Expenses 3.0%

Computer Licensing 3.0%

General Insurance Premium 5.0%

Capital Expenditure Professional Fees 3.0%

Plant, Furniture & Equip 3.0% Cumulative increase Street Lighting 4.5%

Building Expenditure - Based on asset management plan Property Costs 8.0% Utility cost pressures

Asset Sale Development - $2.0m in 2014/15, $3 .0m in 2015/16 and $3.0m in 2016/17 Other Operating Costs 3.0%

Building Escallation 3.0% Cumulative increase thereafter

Capital Works Expenditure Sundry $m

Brown Hill / Keswick Drnge - Based on 49% of 50% of the cost split over 15 years Asset Sales 8.296 - $7,881,200 in 2014/15 (Brickworks)

Brown Hill / Keswick Drnge 2.5% Cumulative increase 0.500 - Rowells Road property

Road Reseal / Maintenance - To match AM Plan over 10 years

Footpath Constn / Recon - To match AM Plan over 10 years Debenture Loan Interest Rates 6.10% From 2014/15

Kerb & Gutter - To match AM Plan over 10 years 6.60% From 2019/20

Grant Funded Works - Indexed to match grant income

Grant / Rate Funded Works 3.0% Cumulative increase

Drainage Loan - $2.0 million pa from 2015/16 indexed

Drainage Loan Increase 2.5% Cumulative increase

Local Drainage Works - $575,000 from 2014/15 indexed

18-Jun-14


99


100


SUMMARY - ACTUAL & PROJECTED

FORWARD ESTIMATES FOR THE 10 YEARS TO 2023/2418-Jun-14

ESTIMATES ESTIMATES ESTIMATES ESTIMATES ESTIMATES ESTIMATES ESTIMATES ESTIMATES ESTIMATES

ACTIVITIES NOTE ORIGINAL REVISED ORIGINAL REVISED 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24

OPERATING

Receipts 1 60,675,587 63,528,396 64,188,267 64,188,267 67,156,486 70,475,337 73,968,064 77,644,069 81,513,273 85,147,304 89,434,884 93,948,830 98,705,662

Payments 2 44,567,643 45,484,530 46,437,610 46,437,610 48,056,408 50,027,813 52,283,893 54,645,859 56,886,865 59,226,272 61,665,809 64,190,304 66,815,885

Net Operating 16,107,944 18,043,867 17,750,657 17,750,657 19,100,078 20,447,525 21,684,171 22,998,210 24,626,408 25,921,032 27,769,075 29,758,526 31,889,777

FINANCING

Principal Receipts - Loan 0 0 0 0 4,413,437 7,924,500 8,266,857 4,668,081 4,756,684 4,847,221 4,939,737 5,034,280 5,130,897

Principal Receipts - Overdraft 0 0 0 0 0 0 0 0 0 0 0 0 0

Principal Payments 1,793,849 1,793,849 1,912,223 1,912,223 2,038,482 2,252,747 2,243,129 1,968,317 1,776,685 2,087,812 2,414,112 2,391,079 2,743,278

Net Financing -1,793,849 -1,793,849 -1,912,223 -1,912,223 2,374,955 5,671,753 6,023,728 2,699,764 2,979,999 2,759,409 2,525,625 2,643,201 2,387,619

OTHER

Asset Sales 750,000 414,800 8,381,200 8,381,200 0 0 0 0 0 0 0 0 0

Receipts - Other 1,507,455 1,658,455 2,007,455 2,007,455 2,257,455 2,507,455 2,757,455 3,007,455 3,257,455 3,507,455 3,757,455 4,007,455 4,257,455

Capital Expenditure 3 17,274,392 27,766,716 19,081,947 19,081,947 23,343,847 26,164,201 24,933,015 24,816,365 26,081,316 26,975,658 28,635,071 31,233,545 33,081,774

Net Unspent Funds 0 8,000,000 0 0 0 0 0 0 0 0 0 0 0

Payments - Other 3,350,000 3,973,984 3,606,550 3,606,550 3,589,856 3,632,941 3,604,265 3,656,007 3,962,260 4,273,419 4,589,914 4,912,214 5,240,827

Net Other -18,366,937 -21,667,445 -12,299,842 -12,299,842 -24,676,248 -27,289,687 -25,779,825 -25,464,917 -26,786,120 -27,741,622 -29,467,530 -32,138,303 -34,065,146

NET INCREASE/(DECREASE)

IN CASH -4,052,841 -5,417,427 3,538,592 3,538,592 -3,201,214 -1,170,410 1,928,075 233,057 820,286 938,819 827,170 263,424 212,250

Add

OPENING CASH 11,470,528 12,608,085 7,190,658 7,190,658 10,729,250 7,528,036 6,357,627 8,285,701 8,518,758 9,339,044 10,277,863 11,105,033 11,368,457

CLOSING CASH 7,417,687 7,190,658 10,729,250 10,729,250 7,528,036 6,357,627 8,285,701 8,518,758 9,339,044 10,277,863 11,105,033 11,368,457 11,580,707

CASH RESERVES:

Commited 35,721,982 36,685,882 42,080,201 42,080,201 38,860,415 35,847,483 36,162,426 36,746,324 37,350,326 37,975,648 38,623,581 39,295,494 39,992,840

Less Used 28,338,714 29,587,390 31,430,135 31,430,135 31,430,136 29,716,136 27,873,391 27,873,391 27,873,391 27,873,391 27,873,391 27,873,391 27,873,391

Net Cash Reserves 7,383,267 7,098,492 10,650,066 10,650,066 7,430,279 6,131,347 8,289,035 8,872,933 9,476,935 10,102,257 10,750,190 11,422,103 12,119,449

SURPLUS/(DEFICIT) 34,419 92,166 79,185 79,185 97,757 226,279 -3,334 -354,176 -137,891 175,606 354,843 -53,646 -538,742

BUDGET 2013/14 BUDGET 2014/15


101


102

NOTE 1


REVENUE PROJECTIONS



DESCRIPTION ORIGINAL REVISED ORIGINAL REVISED 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24

Rates

Rate Revenue 42,463,422 42,396,422 44,615,973 44,615,973 47,159,921 49,789,221 52,566,070 55,498,777 58,596,121 61,867,376 65,322,338 68,971,357 72,825,367

Rate Equivalent Payments 3,940,000 4,099,544 4,320,000 4,320,000 4,550,818 4,793,968 5,050,109 5,319,937 5,604,181 5,903,612 6,219,042 6,551,326 6,901,363

Statutory Charges

Development Act Fees 550,000 590,000 600,000 600,000 618,000 636,540 655,636 675,305 695,564 716,431 737,924 760,062 782,864

Parking Fines 579,300 711,300 669,500 669,500 689,585 710,273 731,581 753,528 776,134 799,418 823,401 848,103 873,546

Dog Fees & Fines 224,300 243,600 273,500 273,500 281,705 290,156 298,861 307,827 317,061 326,573 336,371 346,462 356,855

Other 144,030 157,528 159,260 159,260 164,038 168,959 174,028 179,249 184,626 190,165 195,870 201,746 207,798

User Charges

St Martins - ACFI 4,861,657 4,957,472 5,146,418 5,146,418 5,300,811 5,459,835 5,623,630 5,792,339 5,966,109 6,145,092 6,329,445 6,519,328 6,714,908

St Martins - Other 2,462,067 2,438,496 2,554,416 2,554,416 2,631,048 2,709,980 2,791,279 2,875,018 2,961,268 3,050,106 3,141,609 3,235,858 3,332,933

Waste Income 228,820 228,820 258,659 258,659 266,419 274,411 282,644 291,123 299,857 308,852 318,118 327,661 337,491

Other 946,315 1,165,712 1,121,367 1,121,367 1,155,008 1,189,658 1,225,348 1,262,108 1,299,972 1,338,971 1,379,140 1,420,514 1,463,130

Grants & Subsidies

FA Grant 1,166,532 605,543 1,197,000 1,197,000 1,232,910 1,269,897 1,307,994 1,347,234 1,387,651 1,429,281 1,472,159 1,516,324 1,561,814

UL Road Grants 570,000 247,338 604,000 604,000 622,120 640,784 660,007 679,807 700,202 721,208 742,844 765,129 788,083

Special Road Funding 0 1,064,751 240,000 240,000 0 0 0 0 0 0 0 0 0

Roads to Recovery 438,839 438,839 438,839 438,839 438,839 438,839 438,839 438,839 438,839 0 0 0 0

Drainage 0 0 0 0 0 0 0 0 0 0 0 0 0

Home Assist 465,663 483,663 470,000 470,000 484,100 498,623 513,582 528,989 544,859 561,205 578,041 595,382 613,243

Library 397,472 405,691 389,463 389,463 401,147 413,181 425,577 438,344 451,494 465,039 478,990 493,360 508,161

Other 169,190 160,761 136,837 136,837 140,942 145,170 149,525 154,011 158,632 163,391 168,292 173,341 178,541

Other Income

Investment Income 421,200 584,166 435,291 435,291 448,350 461,800 475,654 489,924 504,622 519,760 535,353 551,414 567,956

Reimbursements 219,030 246,826 209,744 209,744 216,036 222,517 229,193 236,069 243,151 250,445 257,959 265,697 273,668

Insurance Premium Refund 270,000 255,000 250,000 250,000 253,750 257,556 261,420 265,341 269,321 273,361 277,461 281,623 290,072

Profit/(Loss) on Sale 0 0 0 0 0 0 0 0 0 0 0 0 0

Sundry 157,750 320,907 98,000 98,000 100,940 103,968 107,087 110,300 113,609 117,017 120,528 124,143 127,868

Sub Total 60,675,587 61,802,379 64,188,267 64,188,267 67,156,486 70,475,337 73,968,064 77,644,069 81,513,273 85,147,304 89,434,884 93,948,830 98,705,662

Less Profit/(Loss) on Sale 0 0 0 0 0 0 0 0 0 0 0 0 0

Add Capital Income 0 1,726,017 0 0 0 0 0 0 0 0 0 0 0

TOTAL 60,675,587 63,528,396 64,188,267 64,188,267 67,156,486 70,475,337 73,968,064 77,644,069 81,513,273 85,147,304 89,434,884 93,948,830 98,705,662



103


104

NOTE 2


OPERATIONAL & MAINTENANCE EXPENDITURE PROJECTIONS

FORWARD ESTIMATES FOR THE 10 YEARS TO 2023/24

18-Jun-14


DESCRIPTION ORIGINAL REVISED ORIGINAL REVISED 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24

Employee Costs

St Martins Aged Care Facility 5,565,642 5,847,526 6,053,070 6,053,070 6,295,193 6,547,001 6,808,881 7,081,236 7,364,485 7,659,065 7,965,427 8,284,044 8,615,406

Other Employee Costs 19,204,930 19,044,783 20,178,479 20,178,479 20,985,618 21,825,043 22,698,045 23,605,966 24,550,205 25,532,213 26,553,502 27,615,642 28,720,268

Contractual Services

Waste Management - Solo 3,060,000 2,960,000 3,140,000 3,140,000 3,234,200 3,331,226 3,431,163 3,534,098 3,640,121 3,749,324 3,861,804 3,977,658 4,096,988

Waste Management - Disposal 1,336,000 1,136,000 1,196,000 1,196,000 1,243,840 1,293,594 1,345,337 1,399,151 1,455,117 1,513,322 1,573,854 1,636,809 1,702,281

Other Contract 2,320,077 2,511,422 2,385,025 2,385,025 2,480,426 2,579,643 2,682,829 2,790,142 2,901,748 3,017,817 3,138,530 3,264,071 3,394,634

Materials

Materials 883,350 725,260 929,667 929,667 957,557 986,284 1,015,872 1,046,348 1,077,739 1,110,071 1,143,373 1,177,674 1,213,005

Finance Charges

Interest 956,623 950,064 844,690 844,690 641,289 773,030 1,114,050 1,482,210 1,647,145 1,824,525 2,012,200 2,190,921 2,372,532

Other Finance Charges 138,000 140,048 143,360 143,360 148,378 153,571 158,946 164,509 170,267 176,226 182,394 188,778 195,385

Depreciation

Buildings 2,150,487 2,000,487 1,994,000 1,994,000 2,053,820 2,115,435 2,178,898 2,244,265 2,311,593 2,380,940 2,452,368 2,525,940 2,601,718

Plant, Furniture & Equipment 1,077,863 1,205,722 1,221,030 1,221,030 1,257,661 1,295,391 1,334,252 1,374,280 1,415,508 1,457,974 1,501,713 1,546,764 1,593,167

Library Resources 347,000 347,000 304,300 304,300 313,429 322,832 332,517 342,492 352,767 363,350 374,251 385,478 397,042

Infrastructure 6,549,500 6,757,500 6,960,000 6,960,000 7,177,925 7,402,673 7,634,458 7,873,500 8,120,027 8,374,273 8,636,480 8,906,897 9,185,781

Other Expenses

Plant Related 721,150 705,225 719,170 719,170 740,745 762,967 785,856 809,432 833,715 858,727 884,488 911,023 938,354

Computer Maint & Support 1,002,620 928,539 806,600 806,600 830,798 855,722 881,394 907,835 935,070 963,123 992,016 1,021,777 1,052,430

General Insurance Premium 797,838 802,075 838,909 838,909 880,854 924,897 971,142 1,019,699 1,070,684 1,124,218 1,180,429 1,239,451 1,301,423

Professional Fees 1,394,597 1,742,685 1,740,333 1,740,333 1,792,543 1,846,319 1,901,709 1,958,760 2,017,523 2,078,049 2,140,390 2,204,602 2,270,740

Street Lighting 920,000 920,000 957,108 957,108 1,000,178 1,045,186 1,092,219 1,141,369 1,192,731 1,246,404 1,302,492 1,361,104 1,422,354

Rates, Power & Property 1,559,886 1,630,031 1,676,879 1,676,879 1,811,029 1,955,912 2,112,385 2,281,375 2,463,885 2,660,996 2,873,876 3,103,786 3,352,089

NRM Levy 1,162,422 1,162,422 1,196,573 1,196,573 1,288,851 1,327,517 1,367,342 1,408,362 1,450,613 1,494,132 1,538,955 1,585,124 1,632,678

General Operating Costs 4,026,700 4,760,641 4,141,289 4,141,289 4,265,528 4,393,494 4,525,298 4,661,057 4,800,889 4,944,916 5,093,263 5,246,061 5,403,443

Sub Total 55,174,685 56,277,430 57,426,482 57,426,482 59,399,861 61,737,734 64,372,592 67,126,087 69,771,832 72,529,664 75,401,807 78,373,604 81,461,717

Less Depreciation 10,124,850 10,310,709 10,479,330 10,479,330 10,802,834 11,136,330 11,480,125 11,834,537 12,199,895 12,576,538 12,964,812 13,365,079 13,777,708

Leave Provisions 482,192 482,192 509,542 509,542 540,619 573,591 608,575 645,692 685,072 726,855 771,186 818,220 868,124

TOTAL 44,567,643 45,484,530 46,437,610 46,437,610 48,056,408 50,027,813 52,283,893 54,645,859 56,886,865 59,226,272 61,665,809 64,190,304 66,815,885



105


106

NOTE 3


CAPITAL EXPENDITURE PROJECTIONS



ACTIVITIES ORIGINAL REVISED ORIGINAL REVISED 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24

Road Program

Reseal / Maintenance 3,050,212 8,392,969 3,385,774 3,385,774 3,238,025 5,274,905 6,323,698 4,881,606 5,139,482 5,364,186 5,922,268 7,438,412 8,048,251

Reconstruction - Renewal 1,970,518 1,780,654 1,969,923 1,969,923 2,006,444 2,043,641 2,081,529 2,120,118 2,159,423 2,199,457 2,240,233 2,281,765 2,324,067

Reconstruction - Upgrade 1,359,950 1,037,288 1,393,950 1,393,950 1,293,424 1,344,977 1,398,702 1,706,453 1,777,147 1,850,917 1,927,902 2,008,249 2,092,108

Roads to Recovery 438,839 438,839 438,839 438,839 438,839 438,839 438,839 438,839 438,839 0 0 0 0

Kerb & Gutter 2,160,793 2,160,793 2,153,049 2,153,049 2,103,231 2,054,567 2,007,028 1,960,589 1,915,225 1,870,910 1,827,621 1,785,333 1,744,024

ULRG included Above -570,000 -247,338 -604,000 -604,000 -622,120 -640,784 -660,007 -679,807 -700,202 -721,208 -742,844 -765,129 -788,083

Footpath / Bikeway Program

Reconstruction 356,013 582,566 389,278 389,278 411,490 434,969 459,788 486,023 513,755 543,070 574,057 606,812 641,436

Construction 284,675 319,505 331,260 331,260 380,363 436,745 501,484 575,820 661,174 759,181 871,716 1,000,931 1,149,301

Drainage Program

Local Drainage Works 600,000 5,109,616 2,602,020 2,602,020 2,592,250 2,630,018 2,668,518 2,707,770 2,747,791 2,788,600 2,830,218 2,872,664 2,915,958

Brown Hill / Keswick Drainage 1,714,000 1,714,000 0 0 2,595,255 2,660,137 2,726,640 2,794,806 2,864,676 2,936,293 3,009,701 3,084,943 3,162,067

Other Capital Works

Other Works 2,455,000 4,324,944 3,436,940 3,436,940 3,546,922 4,037,104 4,542,971 5,065,026 5,603,787 6,159,788 6,733,581 7,325,736 7,936,839

Building Program

Land & Buildings 975,000 2,013,837 1,125,000 1,125,000 1,833,914 2,007,905 2,198,403 2,406,975 2,635,335 2,885,360 3,159,106 3,458,823 3,786,976

Asset Sale Developments 2,040,000 275,403 2,000,000 2,000,000 3,000,000 3,100,000 0 0 0 0 0 0 0

Other Capital Expenditure

Plant, Furn & Equipment 1,210,796 1,713,405 1,569,950 1,569,950 1,617,049 1,665,560 1,715,527 1,766,993 1,820,002 1,874,602 1,930,840 1,988,766 2,048,429

Library Resources 329,141 312,605 298,785 298,785 307,749 316,981 326,490 336,285 346,374 356,765 367,468 378,492 389,847

Total Capital Expenditure 18,374,937 29,929,086 20,490,768 20,490,768 24,742,835 27,805,563 26,729,611 26,567,496 27,922,808 28,867,922 30,651,867 33,465,797 35,451,220

Less Overheads 1,100,545 2,162,370 1,408,821 1,408,821 1,398,988 1,641,362 1,796,595 1,751,131 1,841,493 1,892,264 2,016,796 2,232,252 2,369,446

TOTAL EXPENDITURE 17,274,392 27,766,716 19,081,947 19,081,947 23,343,847 26,164,201 24,933,015 24,816,365 26,081,316 26,975,658 28,635,071 31,233,545 33,081,774



107


108

Year

En

ded

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

$('

000)

$('

000)

$('

000)

$('

000)

$('

000)

$('

000)

$('

000)

$('

000)

$('

000)

$('

000)

Cu

rren

t A

ssets

Cas

h &

Cas

h E

quiv

alen

ts3,

898

2,18

81,

313

3,65

14,

230

5,46

66,

827

8,12

28,

879

9,62

7Tr

ade

and

Oth

er R

ecei

vabl

es4,

778

4,77

04,

770

4,77

04,

770

4,77

04,

770

4,77

04,

770

4,77

0Fi

nanc

ial A

sset

s1,

011

1,01

11,

011

1,01

11,

011

1,01

11,

011

1,01

11,

011

1,01

1In

vent

ory

1111

1111

1111

1111

1111

To

tal C

urr

en

t A

ssets

9,69

87,

980

7,10

59,

443

10,0

2211

,258

12,6

1913

,914

14,6

7115

,419

No

n-C

urr

en

t A

ssets

Fina

ncia

l ass

ets

00

00

00

00

00

Infra

stru

ctur

e, P

rope

rty, P

lant

& E

quip

men

t59

1,05

260

3,35

761

8,14

463

1,34

964

4,07

765

7,69

667

1,82

868

7,22

570

4,81

372

3,83

0O

ther

non

-cur

rent

ass

ets

7,70

47,

704

7,70

47,

704

7,70

47,

704

7,70

47,

704

7,70

47,

704

To

tal N

on

-Cu

rren

t A

ssets

598,

756

611,

061

625,

848

639,

053

651,

781

665,

400

679,

532

694,

929

712,

517

731,

534

To

tal A

ssets

608,

454

619,

041

632,

953

648,

496

661,

803

676,

658

692,

151

708,

843

727,

188

746,

953

Cu

rren

t L

iab

ilit

ies

Trad

e an

d ot

her P

ayab

les

8,99

08,

814

8,16

68,

010

7,97

68,

005

7,99

88,

005

8,00

27,

999

Bor

row

ings

2,19

52,

253

2,24

31,

968

1,77

72,

088

2,41

42,

391

2,74

33,

118

Sho

rt-te

rm P

rovi

sion

s2,

143

2,12

52,

263

2,32

72,

434

2,52

42,

629

2,73

22,

842

2,95

5A

ged

Car

e Fa

cilit

y de

posi

ts15

,715

16,5

0016

,500

16,5

0016

,500

16,5

0016

,500

16,5

0016

,500

16,5

00T

ota

l C

urr

en

t L

iab

ilit

ies

29,0

4329

,692

29,1

7228

,805

28,6

8729

,117

29,5

4129

,628

30,0

8730

,572

No

n-C

urr

en

t L

iab

ilit

ies

Long

-Ter

m B

orro

win

gs12

,484

14,6

4420

,325

26,6

2429

,515

32,1

8434

,617

37,1

6639

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41,4

70Lo

ng-T

erm

Pro

visi

ons

364

379

394

409

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441

458

476

494

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tal N

on

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20,7

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35,0

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39,9

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To

tal L

iab

ilit

ies

41,8

9144

,715

49,8

9155

,838

58,6

2761

,742

64,6

1667

,270

70,0

3872

,555

Net

Assets

566,

563

574,

326

583,

062

592,

658

603,

176

614,

916

627,

535

641,

573

657,

150

674,

398

Eq

uit

y

Acc

umul

ated

Sur

plus

44,8

0552

,568

61,3

0470

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81,4

1893

,158

105,

777

119,

815

135,

392

152,

640

Res

erve

s51

1,65

151

1,65

151

1,65

151

1,65

151

1,65

151

1,65

151

1,65

151

1,65

151

1,65

151

1,65

1O

ther

Res

erve

s10

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10,1

0710

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10,1

0710

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10,1

0710

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0710

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07T

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qu

ity

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574,

326

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176

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150

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od

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recast

Sta

tem

en

t o

f F

inan

cia

l P

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ion


109

Year

En

ded

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

$('

000)

$('

000)

$('

000)

$('

000)

$('

000)

$('

000)

$('

000)

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000)

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era

tin

g R

ev

en

ue

Rat

es -

Gen

eral

45,1

5147

,673

50,2

7653

,022

55,9

1958

,974

62,1

9865

,597

69,1

8272

,986

Rat

es E

quiv

alen

t - A

AL3,

786

4,03

84,

307

4,59

44,

900

5,22

65,

573

5,94

46,

340

6,74

0St

atut

ory

Cha

rges

1,70

21,

754

1,80

61,

860

1,91

51,

972

2,03

32,

094

2,15

72,

221

Use

r Cha

rges

9,08

19,

353

9,63

49,

923

10,2

2110

,528

10,8

4411

,169

11,5

0411

,850

Ope

ratin

g G

rant

s &

Subs

idie

s3,

476

3,32

03,

407

3,49

53,

586

3,68

03,

339

3,44

03,

542

3,64

8In

vest

men

t Inc

ome

415

448

462

476

490

505

520

536

552

569

Rei

mbu

rsem

ents

210

216

222

229

236

243

250

258

266

274

Oth

er In

com

e36

835

536

236

837

538

339

039

840

541

8T

ota

l O

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tin

g R

ev

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ue

64,1

8967

,157

70,4

7673

,967

77,6

4281

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85,1

4789

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93,9

4898

,706

Op

era

tin

g E

xp

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ses

Empl

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ts26

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27,2

8028

,372

29,5

0730

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31,9

1433

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34,5

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tract

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r exp

ense

s19

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20,6

7321

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22,2

7023

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25,9

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13,7

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1,11

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57,4

2759

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cit

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ap

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ev

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6,76

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8,73

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10,5

1811

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12,6

2014

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15,5

7717

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ital R

ev

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ue

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Gai

n (lo

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n D

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r Rev

alua

tion

of A

sset

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00

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ount

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ecifi

cally

for N

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perty

, Pla

nt &

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ipm

ent R

ecei

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FOC

00

00

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tal C

ap

ital R

ev

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ue

00

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tin

g S

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cit

) aft

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760

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y o

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t T

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ial P

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g M

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as

t S

tate

me

nt

of

Co

mp

reh

en

siv

e In

co

me


110

Ye

ar

En

de

d2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

$('

000

)$

('0

00

)$

('0

00

)$

('0

00

)$

('0

00

)$

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00

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00

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00

)$

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00

)$

('0

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)

Ope

ratin

g Su

rplu

s R

atio

14.2

%15

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16.4

%17

.1%

17.7

%18

.7%

19.0

%20

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21.1

%22

.1%

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rati

o e

xpre

sses

th

e o

per

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ng

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rplu

s as

a p

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nta

ge

of

gen

eral

and o

ther

rate

s, n

et o

f th

e N

RM

lev

y.

Net

Fin

anci

al L

iabi

litie

s R

atio

51.1

%55

.8%

61.9

%63

.9%

63.8

%63

.1%

62.2

%60

.7%

60.0

%58

.9%

This

rati

o e

xpre

sses

net

fin

an

cia

l li

ab

ilit

ies

as

a p

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nta

ge

of

tota

l oper

ati

ng r

even

ue.

Asse

t Sus

tain

abilit

y R

atio

104.

1%10

0.8%

118.

5%12

6.7%

113.

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113.

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7.4%

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5%13

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rati

o e

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et r

enew

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as

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nc

ial

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111

Ye

ar

En

de

d2

01

52

01

62

01

72

01

82

01

92

02

02

02

12

02

22

02

32

02

4

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0)

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7673

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77,6

4281

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4789

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ratin

g R

even

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Less

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ratin

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57,4

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72,5

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/ (

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Be

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al

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6,7

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7,7

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and

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an

ce

s


112

Glossary of Terms

Budget and annual business plan Glossary

113


Glossary of Terms

Amortisation refers to the systematic allocation of the depreciable amount of an asset over its useful life.

Annual business plan refers to a document Council must adopt each year as part of or in conjunction with its budget, pursuant to the requirements of Section 123 of the Local Government Act 1999.

Asset refers to a resource controlled by the City of West Torrens from which future economic benefits, including service potential, are expected to flow.

Asset impairment refers to the situation that occurs when the carrying amount of an asset exceeds its recoverable amount.

Asset management refers to a systematic, structured approach to the maintenance, upgrade and operation of assets, on a whole of life basis, combining engineering principles with sound business practice and economic rationale, and providing the tools to facilitate a more organised and flexible approach to making decisions necessary to meet community expectations.

Asset renewal expenditure refers to expenditure that restores or improves the condition of existing Council assets.

Asset revaluation reserve is the reserve created when Council revalues its assets.

Asset sustainability ratio shows the extent to which capital expenditure on the renewal and replacement of assets matches the rate at which these assets are used or consumed, with the amount spent divided by the total depreciation expense.

Audit Committee refers to a committee of Council established under Section 126 of the Local Government Act 1999.

Balance sheet, sometimes referred to as the statement of financial position, is a summary of Council’s assets, liabilities and equity at a particular point in time, and provides a snapshot of Council’s financial position.

Budget refers to a financial document prepared by Council under Section 123 of the Local Government Act 1999.

Capital expenditure refers to expenditure recognised as an asset in the accounts of the Council, rather than being treated as an operating expense, and includes:

Office furniture and equipment in excess of $2,000 in value; Other plant and equipment in excess of $2,000; Buildings - new construction / extensions - in excess of $10,000; and Infrastructure assets in excess of $10,000.

Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

Cash flow statement refers to a financial statement that shows inflows and outflows of cash and cash equivalents in terms of operating, investing and financing activities.

114


Comprehensive income statement sometimes referred to as a profit and loss statement, is a financial statement that shows the income and expenditure of the Council, and in turn the operating result, being the difference between the two.

Depreciable amount refers to the cost of an asset, or other amount substituted for cost, less its residual value.

Depreciation refers to the systematic allocation of the depreciable amount of an asset over its useful life.

Differential rating refers to the power of Council under Section 156 of the Local Government Act 1999 to declare different rates according to use and / or locality of land.

Employee costs refers to staff and related costs, including salaries and wages, superannuation, leave provisioning, fringe benefits tax, training and WHS expenses.

Equity refers to the residual interest in the assets of the Council after the deduction of its liabilities. Often referred to as net assets, it is the difference between total assets and total liabilities.

Expenses refers to a decrease in future economic benefits, effectively meaning the costs incurred by Council in the normal course of its business operations. They include employee costs, material and contractor expenses, finance costs and depreciation.

Finance costs refers to expenses associated with Council’s financing activities, including

interest on loans and revenue collection charges.

Financial statements comprise a comprehensive income statement, a balance sheet, a statement of changes in equity and a cash flow statement.

Financing activities are activities that result in changes in the size and composition of the contributed equity and borrowings of the entity.

Grants, subsidies and contributions refers to assistance from state and commonwealth governments and other institutions where resources are transferred to Council generally in return for past or future compliance with certain conditions.

Income refers to the gross inflow of economic benefits arising from the ordinary activities of Council when those inflows result in increases in equity. It includes rates, statutory charges, grants, user charges, investment income and reimbursements.

Income statement, sometimes referred to as a profit and loss statement, is a financial statement that shows the income and expenditure of the Council, and in turn the operating result, being the difference between the two.

Infrastructure and Asset Management Plan (IAMP) refers to a plan for the management and development of infrastructure and major assets of the Council that must be developed and adopted for a period of at least 10 years.

Infrastructure asset refers to roads, kerbing, drains, footpaths, cycle paths, land improvements and related assets.

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Investing activities are the acquisition and disposal of long-term assets and other investments not included in operating activities.

Investment income refers to income generated by Council from investment activities.

Liability is an obligation of the Council arising from past events, the settlement of which is expected to result in an outflow of resources embodying economic benefits. Liabilities include provisions and trade and other payables.

Liquidity is a measure of the ability of the Council to pay its debts as and when they fall due.

Loan repayments refers to interest and principal payments made to service Council loans.

Long term financial plan refers to a plan that must be developed and adopted by Council for a period of at least 10 years under Section 122(1a) of the Local Government Act 1999.

Minimum rate refers to the minimum amount payable by a ratepayer which is determined by the Council pursuant to Section 158 of the Local Government Act 1999.

Natural resources management levy (NRM levy) is a separate rate imposed on ratepayers by the state government under Section 95 of the Natural Resources Management Act 2004 and Section 154 of the Local Government Act 1999.

Operating activities are the principal expenditure and revenue-producing activities of the Council and other activities that are not investing or financing activities.

Operating surplus refers to the amount by which operating income exceeds operating expenses, before capital items, the net gain or loss on the disposal or revaluation of assets, and physical resources received free of charge.

Postponement of rates is available to seniors in certain circumstances under Section 182A of the Local Government Act 1999.

Rate rebates refers to mandatory and discretionary rebates on rates that are available to ratepayers under Sections 159 to 166 of the Local Government Act 1999.

Rate remissions are discretionary concessions available to ratepayers where payment of rates causes hardship.

Rates are a charge against the land levied on ratepayers under provisions of the Local Government Act 1999.

Reserves are a credit balance account forming part of Council equity.

Residual value refers to the value of an asset at the end of its useful life.

Revenue refers to the gross inflow of economic benefits arising from the ordinary activities of Council when those inflows result in increases in equity. It includes rates, statutory charges, grants, user charges, investment income and reimbursements.

Separate rates refer to a rate that may be declared by Council for specific purposes under Section 154 of the Local Government Act 1999.

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Service rates or charges may be applied to services such as the collection and disposal of waste under Section 155 of the Local Government Act 1999.

Statutory charges refers substantially to fees set by the state government on regulatory services provided by local government, such as dog registration fees, building and planning fees, and parking fines.

Stormwater flood mitigation refers to measures aimed at minimising the impact of floods in the West Torrens community, including mitigation works associated with Brown Hill and Keswick Creeks.

Sustainability refers to Council’s ability to manage its finances so it can meet spending commitments, both now and in the future, and ensure future generations of taxpayers do not face an unmanageable bill for services provided to the current generation.

User charges refers to fees set by Council for certain goods and services provided, such as library charges, hall hire, tennis court hire and community centre fees.

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