- supports an increased level of investment in infrastructure,
- ensures the sustainability of the City’s capital infrastructure, and
- reduces the City’s reliance on long-term debt.
What is an operating budget?
Operating budgets outline estimates for revenues and expenditures associated with the operations of City services for the fiscal year. The approved operating budget shows what the City will spend on programs and services such as transit, garbage and recycling collection, parks, recreation programs and road maintenance. The City’s Financial Services Department produces annual operating budgets as well as three-year operating forecasts.
What is the capital budget?
The capital budget outlines the City’s plans to fund/support capital assets like buses, snowplows, buildings, streets, pathways and other infrastructure that support the delivery of programs and services. Capital budgets include costs and related sources of funding to maintain, replace and refurbish these kinds of assets over their useful lives. The City maintains 15-year capital expenditure models.
What is the municipal utility operating budget?
Utilities Kingston – a separate corporation that is wholly owned by the City of Kingston – prepares budgets for the municipal utilities that it manages and operates on behalf of the City, including, water, wastewater and natural gas systems. These services are funded through user rates and are not supported by property taxes.
How does the City fund its operating and capital budgets?
Property taxes and other revenue sources such as user fees fund the City’s operating budget. A component of the operating budget is transferred to the capital reserve funds to be used for capital spending and debt related charges.
What are the City’s other sources of revenue?
In addition to property taxes, which make up 65 per cent of operating revenues, the City receives operating revenues from user fees and provincial & federal grants/subsidies.
What are reserves and reserve funds?
Reserves and reserve funds are monies set aside to fund capital expenditures similar to having personal savings accounts. They are also used to manage unanticipated expenses and to support the City’s long-term financial stability.
What is the 1 per cent capital levy?
The City has earmarked a 1 per cent annual tax increase to raise funds to support capital infrastructure. This annual levy is transferred into the capital reserve funds each year. This 1 per cent capital levy is part of longer term strategies for responsible asset management. It:
What is long-term debt and how is it used?
The City uses long-term debt to fund larger capital expenditures. It is similar to a homeowner’s mortgage and is repaid over time through payments which include interest. Long-term debt charges are paid for from the capital reserve funds.
What is the City’s credit rating and how does it affect the ability to borrow money?
The City’s AA credit rating is determined by Standard & Poor’s, a third-party credit rating agency. A credit rating is an unbiased, informed opinion about the City’s capacity to meet its financial commitments. The City’s strong rating demonstrates its prudent financial management practices and policies and allows the City to secure funds on the investment market at attractive interest rates and terms.
How does the City carry out its planning and budgeting exercises?
Based on community engagement and input, Council determines the corporation’s strategic priorities and service levels. Departmental workplans and supporting budgets are developed to achieve these initiatives and to support the ongoing operation of City facilities, services and programs.
A collaborative approach to planning allows for Council to identify and allocate resources in an affordable and sustainable manner as illustrated below: