City of Yellowknife ends 2021 with $15.8-million surplus
The City of Yellowknife ended 2021 with a $15.8-million surplus, nearly double last year’s figure. Staff say the city is well-placed to weather the ongoing impacts of the Covid-19 pandemic.
According to a new financial report, Yellowknife had a “strong financial year” in 2021 with revenues coming in above budget and expenses coming in below budget.
User fees brought in more money than expected, as did land sales, licences and permits. Salaries, wages and benefits were lower than budgeted due to vacancies, and contracted costs were reduced due to supply chain issues.
Discussing the report at a meeting on Monday, Mayor Rebecca Alty said vacancies were “not the ideal position” for the city as delivering services becomes more difficult, but a surplus brought benefits. She said, for example, the city doesn’t “have to freak out right now” about inflation in Yellowknife being at its highest in 30 years.
Sharolynn Woodward, the city’s director of corporate services, said City Hall had been “extremely conservative” in recent budgets due to the uncertainty brought on by Covid-19.
The balance in the city’s general fund – which supports operations like public safety, transit and street maintenance – is now $10.7 million, or 24.7 percent of budgeted expenditures. For the second year in a row, that balance is well above the city’s budget policy, which states the general fund should maintain a balance of 10 to 15 percent of expenses.
The city ended 2020 with an $8-million surplus and had $13.3 million in its general fund, or 31 percent of budgeted expenses, at the time.
Woodward recommended that the city maintain the “cushion” in the general fund for another year as she expects “far-reaching impacts” from the Covid-19 pandemic, particularly in the supply chain.
“There’s going to be quite a rollercoaster ride in our expenditures as things that we ordered a year, 18 months ago are finally getting here,” she said, “but things that we’ve ordered now may or may not show up in the foreseeable future.”
Councillor Shauna Morgan questioned plans to keep a higher-than-normal balance in the general fund, pointing out that the city is not a profit-seeking corporation.
“We can’t continue indefinitely just saying we’re always in exceptional times,” Morgan said. “At some point we either change the policy or we decide we’re going to align ourselves with the policy.”
Woodward cautioned against making “reactionary” changes.
City councillors will vote to approve the audited financial statements and maintain the general fund balance at their next regular meeting on May 9.