Preliminary results suggest the City of Edmonton finished 2020 with a surplus of $40.2 million.
In its latest financial update, administration suggests that "without early budget adjustments the City of Edmonton could have ended the year with a deficit of over $100 million."
Revenues were $29.1 million less than the budget that was adjusted for COVID-19 last spring, while expenses were $69.3 million lower. The figures suggest the COVID-19 pandemic resulted in an overall decline in revenue of $171.7 million, compared to the original budget for 2020.
Administration says a number of factors contributed to the surplus, including smaller than anticipated declines in revenue from business licenses and lower than anticipated fuel and utilities costs. Personnel costs were "extremely" close to the budgeted amount. Revenues from Edmonton Transit were $14 million lower than the adjusted amount budgeted in April 2020.
Administration recommends carrying $7.8 million forward for expenses that were budgeted for 2020 but are now anticipated for 2021. Another $7.6 million would be used to address an outstanding loan related to the now decommissioned construction and demolition recycling facility that needs to be repaid by 2025.
The remaining $24.8 million would be appropriated within the Financial Stabilization Reserve to support the City of Edmonton's pandemic response. Potential future costs include extended operations of the pandemic shelter, assisting with the COVID-19 vaccine rollout, "possible" business and economic support programs, and demand for recovery support from non-profit organizations.
An update from the Edmonton Police Service suggests that higher than anticipated salary costs were more than offset by lower travel, training, insurance, and maintenance costs, resulting in a surplus of $2.2 million that will be transferred to the EPS Operating Reserve.
The City of Edmonton ended 2020 with $3.41 billion in outstanding debt which is 56.6% of the Municipal Government Act debt limit. That's an increase of $204 million from 2019. Current projections suggest total debt will peak in 2024 at $4.22 billion primarily due to the Valley Line LRT and Yellowhead Trail Freeway Conversion projects.
Audited financial statements are expected to be presented to city council's audit committee on April 16.