FINANCE, CORPORATE SERVICES ANDAgenda ... - City of Melbourne · 6/24/2003 · 2003. Copies of the budget were made available at Melbourne City Council - Town Hall (Ground Floor

F I N A N C E , C O R P O R A T E S E R V I C E S A N DG O V E R N A N C E C O M M I T T E E R E P O R TC O V E R S H E E T

Agenda Item 3.1

24 June 2003CONSIDERATION OF SUBMISSIONS FOR THE PROPOSED2003/2004 ANNUAL BUDGET

Division Financial & Business Services

Presenter Joe Groher, Manager Financial Services

Purpose

To report to the Finance, Corporate Services and Governance Committee on public submissions inresponse to the approved budget in accordance with the requirements of the Local Government Act,1989.

Finance

The financial implications are contained in the body of this report.

Legal

The process detailed in the report accords with the requirements of the Local Government Act and theLocal Government Regulations.

Recommendation

That the Finance, Corporate Services and Governance Committee:

• recommend to Council, the adjustment to the proposed 2003/04 budget resulting from the receiptof the proceeds from the sale of the Queen Victoria Hospital Site in June 2003;

• after considering all written submissions and hearing from anyone wishing to be heard in supportof their submission, recommend to Council for the reasons detailed in the report:

½ to note comments by Mr van der Craats and provide a further report on the quality ofInternet/IT services;

½ no amendment to the budget for the Sustainable Living Festival request;

½ no amendment for the budget for the 2004 Athens Olympic Touch Relay request;

½ no amendment to the budget for the Australian Open request;

½ no amendment for the budget for the Bicycle Victoria request;

½ no amendment for the budget for the Queensberry and Cardigan Streets streetscape request;

½ no amendment for the budget for the Asian Food Festival request;

Attachments:1. Attachment 1, Rate Determination Statement2. Attachment 2, Statement of Financial Performance3. Attachment 3, Statement of Financial Position4. Attachment 4, Statement of Cash Flow5. Attachment 5, Mr Anthony van der Craats6. Attachment 6, Mr Alexander Kohl, Sustainable Living Festival7. Attachment 7, Mr Paul McNamee, Australian Open8. Attachment 8, Mr Harry Barber, Bicycle Victoria9. Attachment 9, Mr Patrick Falk and Mr Peter Demiris10. Attachment 10, Danny Doon and Eng Lim, Asian Food Festival11. Attachment 11, Mr John Clark, MCG 150th Birthday Celebrations12. Attachment 12, Ignatios Karasavvidis and Nicole Donegan, Lonsdale Street – Greek Precinct Association13. Attachment 13, Mr Greg Mahoney, Hardware Precinct Association14. Attachment 14, Travel by Councillors and Council Officers – memo from Alison Lyon

½ no amendment for the budget for the MCG 150th Birthday Celebrations; and

½ no amendment for the budget for the Hardware Lane lighting upgrade request

• recommend that Council advise each of the submitters of the Council’s decision in relation to thismatter and the reasons for the decision.

F I N A N C E , C O R P O R A T E S E R V I C E S A N DG O V E R N A N C E C O M M I T T E E R E P O R T

Agenda Item 3.1

24 June 2003

CONSIDERATION OF SUBMISSIONS FOR THE PROPOSED2003/2004 ANNUAL BUDGET

Division Financial & Business Services

Presenter Joe Groher, Manager Financial Services

Purpose

1. In accordance with the Local Government Act 1989 (“the Act”) to consider public submissions inresponse to the approved budget for 2003/2004 presented to Council on 3 June 2003.

Background

2. The annual budget for the 12-month period 1 July 2003 to 30 June 2004 comprising the OperatingBudget and the Council Works Program was presented to Council for approval on 3 June 2003. Atthat meeting Council delegated power to consider submissions to the Finance, Corporate Servicesand Governance Committee.

3. Following approval, the budget was advertised in the Age and Herald Sun newspapers on 5 June2003. Copies of the budget were made available at Melbourne City Council - Town Hall (GroundFloor Front Desk), North Melbourne Library, East Melbourne Library, Carlton Baths CommunityCentre, and Council’s Web Page. At the conclusion of the submission period on the 23 June 2003,nine submissions had been received of which three have requested to address the Committee inperson.

Issues

Queen Victoria Hospital Site Proceeds

4. On the 20 June 2003, Grocon elected to pay the proceeds from the Queen Victoria Hospital Site.The proceeds had been budgeted to be received in July 2003 and included in the proposed 2003/04budget presented to Council on 3 June 2003.

5. The receipt of the proceeds does not materially impact the Rate Determination Statement, theStatement of Financial Performance, or the Statement of Financial Position. The receipt does havea major impact on the Statement of Cash Flow.

6. The Rate Determination Statement surplus and the Statement of Financial Performance surplusincrease by $0.107M for additional interest. The revised surpluses are $3.134M for the RateDetermination Statement (Attachment 1) and $2.598M for the Statement of Financial Performance(Attachment 2).

7. The Statement of Financial Position shows an increase in equity by $0.107M to $2,108.678Mresulting from the increase in the surplus for the year. (Attachment 3).

8. The Statement of Cash Flows shows as outflow of cash of $42.771M (Attachment 4) a change of$53.879M resulting from the earlier receipt of the proceeds from the sale of the Queen VictoriaHospital Site in the 2002/03 financial year.

9. The amount transferred to reserves has been reduced by $0.356M reflecting the early receipt of theproceeds.

Mr Anthony van der Craats

Synopsis of submission

10. In an e-mail sent to Council (attachment 5), Mr van der Craats stated that in relation to Council’sSpecial Travel Committee and Councillor and Staff Expenses;

“The requirement to determine the budget allocation for Councillor expenses to allow for theproper and responsible management of Councillor expenses and the restructure of the Councilscommittees so as to provide for more effective open and transparent public accountability”.

Management comment

11. The recommendations have been noted. Refer to attachment 14 for information from the ActingExecutive Manager Governances and Resources relevant to the submission.


12. In relation to the Council Web Site and IT budget:

“On going concern at the level of expenditure on IT and the inability of the council’s web site toprovide public access to council documentation and issues related to the quality of Internet/ITservices”.

Management comment

13. The concerns regarding the level of expenditure are noted. Council’s expenditure on IT has beenrecently benchmarked by Compass Management Consulting and compares favourably withorganisations of a similar size. It is unclear from the statement as to whether the reference to theInternet/IT services relates to content or availability of the service. Further clarification is requiredto address this matter adequately. If issues of significance are raised by Mr van der Craats thesewill be addressed in a further report to the Finance, Corporate Services and GovernanceCommittee.


14. In relation to the rates increase:

“That the proposed budget be rejected and that any proposed increase in the rate 2003-2004 belimited to no more than 1%.”

Management comment

15. Mr van der Craats comment has been noted.

16. Mr van der Craats has requested to address the Finance, Corporate Services and GovernanceCommittee on 24 June.

Sustainable Living Festival


17. In an email sent to Council from Mr Alexander Kohl, Festival Producer for the sustainable livingfestival, Mr Kohl stated:

“We suggest that the City of Melbourne make a further contribution in addition to its sponsorshipof the Sustainable Living Festival to ensure delivery of some excellent programs as suggestedoverleaf or other programs that satisfy its objectives. We suggest a contribution of a further$50,000 will elevate the profile of the City of Melbourne as the leader of sustainability in Australiato the public, industry and other government bodies.” (Attachment 6)

18. Mr Kohl has requested to address the Finance, Corporate Services and Governance Committee on24 June.

Management Comments

19. Council has supported the Sustainable Living Festival in the past. An amount of $50,000 wasprovided for in the 2002/03 budget.

20. The proposed 2003/04 budget includes a $50,000 grant to support the event.

21. It is proposed to continue the support, both financially via the grant and in kind via City Marketinginitiatives for 2003/04.

22. No amendment to the budget is recommended.

Athens 2004 Olympic Torch Relay


23. Ignatios Karasavvidis (President) and Nicole Donegan (Precinct Coordinator) of the LonsdaleStreet – Greek Precinct Association have requested funding of $62,500 for a street party when the2004 Olympic Torch Relay passes through Lonsdale Street-Greek Precinct some time in the lasthalf of June 2004. (Attachment 12)

24. Mr Ignatios Karasavvidis and Ms Nicole Donegan have requested to address the Finance,Corporate Services and Governance Committee on 24 June.

Management comment

25. The proposed 2003/04 budget includes $1.086M for grants to support sports marketingopportunities and City Events. No funds have been provided for this event.


Australian Open


27. Mr. Paul McNamee, (Chief Executive of the Australian Open) has requested support from the Cityof Melbourne of $30,000 for funding of programs associated with the 2004 Australian TennisOpen. (Attachment 7)

Management comment

28. In the 2003/04 Budget the combined funding proposed for Sports Marketing Opportunities hasincreased by 58% to $582,000 with the inclusion of the Rugby World Cup and the Melbourne2005 Deaflympic Games.


Bicycle Victoria


30. Mr. Harry Barber (General Manager, Bicycle Victoria) has requested further support from the Cityof Melbourne of $1.140M ‘to implement some key priority projects identified in the 2002/07 BikeStrategy and expand the good work achieved with the $478,000 allocation in last years budget.’(Attachment 8)

Management comment

31. City of Melbourne has constructed and upgraded bicycle paths in the past. An amount of $478,000was provided for in the 2002/03 budget.

32. The proposed 2003/04 budget includes $370,000 to implement and make improvements to abicycle network that is safe, accessible and appropriate for cyclists.

33. The submission from Bicycle Victoria to bring forward projects on the 2002/07 Bike Plan into the2003/04 bicycle program is premature. Projects require detailed design work and consultation andtherefore the proposal is not recommended.

Mr Patrick Falk and Mr Peter Demiris


34. Mr Patrick Falk and Mr Peter Demiris, representing owners/occupiers of properties close to theintersection of Queensberry and Cardigan Streets, Carlton, have requested streetscaping at theintersection of Queensberry and Cardigan Streets to rectify the ‘damage to the streetscaperesulting from the installation of traffic lights.’ From the written submission received (Attachment9), no actual funding is stated, but an indicative amount of $50,000 has been suggested by CouncilOfficers.

Management comment

35. The proposed 2003/04 budget provides funding of $2.085M for streetscapes throughout the city.

36. The proposed Queensberry Street / Cardigan Street streetscape improvement project to be partiallyfunded up to $20,000 from the 2003/04 minor streetscape improvement budget. The remainder ofthe project to be considered by Council as part of its 2004/05 works program development process.


Asian Food Festival


38. Danny Doon (President) and Eng Lim (Hon Secretary/Festival Coordinator) of the ChineseRestaurateurs Association of Victoria Inc have requested an additional $30,000 for detailedmarketing program for the Asian Food Festival. (Attachment 10)

Management comment

39. Council has supported the Asian Food Festival in the past. An amount of $20,000 was providedfor in the 2002/03 budget.

40. The proposed 2003/04 budget includes a $20,000 grant to support the event.

41. It is proposed to continue the support, both financially via the grant and in kind via City Marketinginitiatives for 2003/04.


MCG 150th Birthday Celebrations


43. Mr John Clark, (Marketing Manager, Melbourne Cricket Club) has requested ‘financial support inthe vicinity of $30,000 to assist with the successful production of…. two major events in the MCG150th Birthday Program; (i) MCG Open Week and (ii) MCG Open Day.’ (Attachment 11)

Management comment

44. In the 2003/04 Budget the funding proposed for City Events sponsorship is $504,000. Funding forthe MCG 150th Birthday program has not been included.


Hardware Lane Lighting


46. Mr Greg Mahoney (President, Hardware Precinct Association) has requested funding for lightingin Hardware Lane. The written submission received (Attachment 13), does not specify themagnitude of the funding.

Management comment

47. The proposed 2003/04 budget provides funding of $0.877M for lighting installation and upgradesthroughout the City.

48. Subject to consultation with the stakeholder, Council will consider further upgrading the streetlighting in Hardware Street as part of its 2003/04 street lighting upgrade budget.


Financial Implications

50. The proposed 2003/04 Budget expects a surplus of $3.134million. The financial impact of thesubmissions would result in additional expenditure of $1.393million. The net financial impact ofeach submission is detailed in table 1 below.

Table 1: NET FINANCIAL IMPACT OF SUBMISSIONS

Proposed2003/04Budget$000s

Submissions

$000s

NetFinancialImpact$000s

Mr. Van der Craats 0 0 0Sustainable Living Festival 50 100 50Australian Open 0 30 30Bicycle Victoria 350 1,490 1,140Queensberry and Cardigan Streetsstreetscape

0 50 50

Asian Food Festival 20 50 30MCG 150th Celebrations 0 30 30Lonsdale Street Greek PrecinctAssociation

0 62.5 62.5

Hardware Lane lighting 0 N/A N/ATotal 420 1,812.5 1,392.5

Relation to Council Policy

51. The budget submission process has been conducted in accordance with Council policy.

Recommendation

52. That the Finance, Corporate Services and Governance Committee:

52.1. recommend to Council, the adjustment to the proposed 2003/04 budget resulting from theearly receipt of the proceeds from the sale of the Queen Victoria Hospital Site in June 2003;

52.2. after considering all written submissions and hearing from anyone wishing to be heard insupport of their submission, recommend to Council for the reasons detailed in the report:

52.2.1. To note comments by Mr van der Craats and provide a further report on the qualityof Internet/IT Services;

52.2.2. no amendment to the budget for the Sustainable Living festival request;

52.2.3. no amendment for the budget for the 2004 Athens Olympic Touch Relay request;

52.2.4. no amendment to the budget for the Australian Open request;

52.2.5. no amendment for the budget for the Bicycle Victoria request;

52.2.6. no amendment for the budget for the Queensberry and Cardigan Streets streetscaperequest;

52.2.7. no amendment for the budget for the Asian Food Festival request;

52.2.8. no amendment for the budget for the MCG 150th Birthday Celebrations; and

52.2.9. no amendment for the budget for the Hardware Lane lighting upgrade request

52.3. recommend that Council advise each of the submitters of the Council’s decision in relationto this matter and the reasons for the decision.

Attachment 1Agenda Item 3.1

Finance, Corporate Services & Governance Committee24 June 2003

CITY OF MELBOURNERate Determination StatementYear Ending 30 June 2004

Rate DeterminationStatement

MYR Budget Movementbetween

2002/03 2003/04 Budget & %($000’s) ($000’s) MYR Change

Brought Forward Surplus 7,449 2,274 (5,175) (69.5)%

RevenueNet Rates 107,321 113,214 5,893 5.5%Grants & Subsidies 5,536 5,839 303 5.5%Parking Fees 24,540 26,843 2,303 9.4%Fines 27,169 27,811 642 2.4%Property Rental 4,358 4,618 260 6.0%Sundry Fees & Charges 11,002 11,299 297 2.7%Intercompany Revenue 9,798 9,713 (86) (0.9)%Finance Income 5,752 7,538 1,786 31.0%Sales & Recoveries 3,936 1,877 (2,059) (52.3)%Proceeds from sale of non currentassets

54,335 3,000 (51,335)

Total Revenue 253,748 211,752 (41,996) (16.6)%

ExpenditureEmployee Costs 59,036 63,668 (4,632) (7.8)%Materials and Services 91,750 93,541 (1,791) (2.0)%Finance and Insurance Costs 2,983 3,061 (78) (2.6)%Grants & Subsidies 8,860 9,484 (624) (7.0)%Government Taxes & Levies 2,259 2,356 (97) (4.3)%Total Operating Expenditure 164,887 172,110 (7,223) (4.4)%

Surplus available for CouncilWorks Program

96,309 41,916 (54,393) (56.5)%

Total Council Works Program 37,089 44,972 (7,883) (21.3)%

Transfer to Reserves (59,213) 6,190 65,403Surplus 7 3,134 3,127



CITY OF MELBOURNEStatement of FinancialPerformanceYear Ending 30 June 2004

FinancialPerformance



RevenueNet Rates 107,321 113,214 5,893 5.5%Grants & Subsidies 10,141 9,342 (799) (7.9)%Parking Fees 24,540 26,843 2,303 9.4%Fines 27,169 27,811 642 2.4%Property Rental & Hire 4,358 4,618 260 6.0%Sundry Fees & Charges 11,002 11,299 297 2.7%Intercompany Revenue 9,798 9,713 (86) (0.9)%Finance Income 5,752 7,538 1,786 31.0%Sales & Recoveries 3,936 1,877 (2,059) (52.3)%Proceeds from sale of non currentassets

2,857 200 (2,657) (93.0)%

Total Revenue 206,875 212,455 5,580 2.7%

ExpenditureEmployee Costs 59,036 63,668 (4,632) (7.8)%Materials and Services 91,750 93,541 (1,791) (2.0)%Finance and Insurance Costs 2,983 3,061 (78) (2.6)%Depreciation 35,630 32,022 3,608 10.1%Grants & Subsidies 8,860 9,484 (624) (7.0)%Government Taxes & Levies 2,259 2,356 (97) (4.3)%Maintenance Costs 7,576 5,525 2,051 27.1%WDV of fixed assets sold 1,000 200 800 80.0%Total Operating Expenditure 209,094 209,858 764 0.4%

Result from Ordinary Activities # (2,219) 2,598 4,818 (217.1)%

# prior to estimating council infrastructure asset revaluation.



CITY OF MELBOURNE

Statement of Financial Positionas at 30 June 2004

Financial Position



AssetsReceivables 23,425 20,653 (2,771) -11.8%Inventories 19 19 0 0.0%Investments - Cash 157,449 125,279 (32,170) -20.4%Investments in other entities 32,553 32,553 0 0.0%Property, Plant & Equip 1,925,579 1,973,949 48,369 2.5%Other Assets 3,454 3,454 0 0.0%Total Assets 2,142,479 2,155,907 13,428 0.6%

LiabilitiesTrade Creditors 27,438 31,734 4,296 15.7%Provisions 14,585 15,651 1,065 7.3%

Total Liabilities 42,023 47,384 5,361 12.8%

Total Capital Employed 2,100,455 2,108,522 8,067 0.4%

EquityAccumulated surplus 1,451,351 1,455,497 4,146 0.3%Surplus/(deficit) for the year (2,219) 2,598 4,817 -217.0%Reserve transfer 1,065 1,415 350

1,450,196 1,459,509 9,313 0.6%

Reserves 650,259 649,169 (1,090) -0.2%Total Equity 2,100,455 2,108,678 8,223 0.4%



CITY OF MELBOURNEStatement of Cash FlowYear Ending 30 June 2004

Cash Flow



Cash flows from operating activitiesReceipts Rates, fees and charges (including GST) 179,094 182,398 3,304 1.8% Grants and other contributions 12,526 9,342 (3,184) -25.4% Interest 5,752 7,538 1,786 31.0% Dividends 7,863 7,764 (99) -1.3% Tax equivalents-subsidiaries 1,935 1,949 14 0.7% Other (including sales & recoveries) 3,936 1,877 (2,059) -52.3%Payments Employee costs (59,591) (62,650) (3,059) 5.1% Materials and services (including GST) (98,564) (96,292) 2,272 -2.3% Financial costs (2,983) (3,061) (78) 2.6% Other (18,695) (17,366) 1,329 -7.1%Net cash provided by operating activities 31,273 31,500 226 0.7%

Cash flows from investing activities Proceeds from sale of non-current assets 56,192 3,000 (53,192) -94.7% Payments for non-current assets (40,040) (77,271) (37,231) 93.0% Purchase of investments (5,000) 5,000Net cash (used in) investing activities 11,152 (74,271) (85,423) -766.0%

Cash flows from financing activities 42,425 (42,771) (85,197) -200.8%

Payment of inter-company loan 0

Net cash (used in) financing activities 42,425 (42,771) (85,197) -200.8%

Net increase/(decrease) in cash held 42,425 (42,771) (85,196) -200.8%

Cash at beginning of the financial year 114,958 168,050 53,092 46.2%

Cash at end of the financial year 157,384 125,279 (32,105) -20.4%



M E M O R A N D U M

Date 18 June 2003

To Chair and members - Finance, Corporate Services and Governance

Committee

From Alison Lyon

Acting Executive Manager Governance and Resources

Subject TRAVEL BY COUNCILLORS AND COUNCIL OFFICERS

In relation to the issues raised by Anthony van der Craats in his e-mail to Councillors dated 3June 2003, please find outlined below information that may assist in the consideration ofmatters identified in part (a) headed ‘Council’s Special Travel Committee and Councillor andStaff Expenses’.

The questions raised by Mr van der Craats are identified in italics.

1. That the Special Travel Committee be disbanded and its responsibilities be transferredto the Finance, Corporate Services and Governance Committee.

• The Councillor Travel Special Committee (CTSC) assesses and approves proposalsfor interstate and international travel by Councillors, other than interstate travelundertaken by the Lord Mayor which requires the approval of the CEO. The CTSCis a section 86 Committee and thus has delegated powers to consider and approvetravel. The CTSC is guided by the framework set out in the Councillor Expenses andResources Guidelines.

• The CTSC comprises the LM, DLM and Cr Nicholson and meets when required. Noformal meeting schedule has been put in place as the opportunities for Councillorrepresentation interstate and overseas, some of which are identified through externalsources, may arise at short notice.

• Should the CTSC be disbanded and responsibilities transferred to the FCSG,difficulties may arise when required to establish a meeting date/time suitable to themajority of Committee members at short notice. These would need to be in the formof Special meetings of the FCSGC.

• As with the FCSGC, the CTSC is open to members of the public who are able toattend and make submissions.

• All reports and paperwork considered by the Committee are available to members ofthe public.

2. That reports and information related to Councillor travel be tabled in the Finance,Corporate Services and Governance Committee papers and also be made available onthe Council internet site.

• If the CTSC was disbanded and responsibilities transferred to the FCSG, all

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proposals would obviously form part of the agenda paper for Committee meetings.As indicated above, some problems may be experienced due to the short noticesometimes provided in respect of Councillor travel opportunities.

• The agenda paper and minutes of CTSC meetings are posted on the Council’swebsite.

• All reports on proposals to travel and travel undertaken which are considered by theCTSC are available to members of the public on request or through attendance atmeetings.

• Should Council decide that CTSC reports should be published on Council’s website, it should be noted that currently the reports may be received either a short timeprior to the meeting or be tabled at the meeting. The posting of reports can onlyoccur as soon as practicable after receipt. Alternatively, the Council may impose arequirement that reports be provided at the time of scheduling the meeting to enablethe posting of reports prior to the meeting.

3. That a detailed report be tabled at the Finance, Corporate Services and GovernanceCommittee outlining all Staff Travel approved by the CEO and all other Council paidtravel for the current financial year with a comparison to budget. Thereafter, that amonthly Staff Travel report be tabled at each meeting of the Finance, CorporateServices and Governance Committee.

• All interstate and overseas travel by Council officers and Councillors (with theexception of interstate travel by land for less than 3 days) undertaken in an officialcapacity in the previous 12 months is recorded on a Travel Register. The Registerincludes the name of staff member or Councillor travelling, the date, destination,purpose and total cost of the overseas or interstate travel.

• The Register is updated on an on-going basis as relevant travel details areconfirmed. This register is maintained by the Governance Services Branch and isavailable for inspection upon request.

• The Register is maintained and includes all required information in accordance withrequirements under the Local Government Act 1989.

4. That budget monthly and year to date comparisons on councillor travel and expensesbe published as part of the Quarterly statements.

• The publication of quarterly Councillor expense details was first proposed in 1999.Following extensive reviews and recommendations made by the internal auditor, theCouncil (May 2000) resolved to publish Councillor expenses in a range ofcategories identified through that process. These categories were recently reviewedas part of the revision of the Councillor Expenses and Resources Guidelines (March2003). As part of this process, Council decided to report Training and Developmentas a separate category to provide for the following structure:

• Conference and Functions• Training and Development• Travel Local• Travel Interstate• Travel Overseas• Communication Local• Communication Interstate• Communication Overseas

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• Functions external to Town Hall• Childcare

• Any variation of Council’s published categories will need to be the subject of aCommittee resolution.

• The Councillor Expenses and Resources Guidelines does not provide for thecapping of expenses incurred in each of these areas. The Guidelines recognise thatthe level of expenditure in each category incurred by each Councillor will depend onthe individual role and circumstances.

5. That the reports (including but not limited to the travel register) relating to Councillorand Staff Travel be made available to the public on the Council internet site.

• As indicated under item 3, details of all interstate and overseas travel by Councilofficers and Councillors undertaken in an official capacity in the previous 12 monthsis recorded on a Travel Register. This is available to members of the public uponrequest.

• In addition, although not currently available on the Council’s internet site, allreports on travel proposals and travel undertaken by Councillors are available tomembers of the public by attendance at the meeting or by contacting Council.

Should you require any further advice in relation to these matters, please do not hesitate tocontact me.

Alison LyonActing Executive Manager Governance and Resources

Telephone 9658 9106Facsimile 9658 9070E-mail [email protected]

Agenda Item 3.1Finance, Corporate Services and Governance Committee

24 June 2003

FINANCE ATTACHMENT

CONSIDERATION OF SUBMISSIONS FOR THE PROPOSED 2003/2004 ANNUALBUDGET

The financial implications are discussed throughout the report.

Joseph GroherManager Finance Services

Agenda Item 3.1Finance, Corporate Services and Governance Committee

24 June 2003

LEGAL ATTACHMENT

CONSIDERATION OF SUBMISSIONS FOR THE PROPOSED 2003/2004 ANNUALBUDGET

Contents of the budget.

Section 144 of the Local Government Act 1989 (“the Act”) requires the Council to prepare a budgetfor each financial year commencing 1 July. A budget is required to contain the prescribedparticulars which are detailed in the Act and Regulation 16 of the Local Government Regulations2001 (the Regulations). A proposed budget must include the following:

(a) the projected revenue and expense relevant to determining the operating result;

(b) a reconciliation of the projected revenue and expense relevant to determining the amount tobe raised by general rates and charges, with the projected revenue and expense relevant todetermining the operating result;

(c) the total amount proposed to be borrowed, other than borrowings to refinance existingloans;

(d) the total amount proposed to be redeemed;

(e) the projected cost of servicing the borrowings;

(f) the projected capital works program and the funding sources for that program;

(g) the proposed rate in the dollar for each type of rate to be levied;

(h) the estimated amount to be raised by each type of rate to be levied;

(i) the estimated total amount to be raised by rates;

(j) the proposed percentage change in the rate in the dollar for each type of rate to be leviedcompared to that of the previous financial year;

(k) the number of assessment for each type of rate to be levied compared with the previousyear;

(l) the total number of assessments;

(m) the basis of valuation to be used;

(n) the estimated total value of land in respect of which each type of rate is to be leviedcompared with the previous year;

(o) the proposed unit amount to be levied for each type of charge under section 162 of the Act;

(p) the estimated amount to be raised by each type of charge to be levied compared with theprevious year;

(q) the estimated total amount to be raised by rates and charges; and

(r) any significant changes that may affect the estimated amounts to be raised.

Submissions process

The Act and Regulations also provide that certain information must be provided in the public noticeof the preparation of a proposed budget. The Act also outlines the public submissions process.

Under the Act, section 223 a person may request to be heard in support of a written submission, andmust be given a hearing before the Council or Committee as appropriate.

The Act, section 223(e) provides:

“The Council must take into consideration all the submissions made under this sectionand after it has made a decision must notify in writing every person who has lodged aseparate submission and in the case of a submission lodged on behalf of a number ofpersons, notify in writing 1 of those persons, of the decision and the reasons for thedecision.”

However, Council is not bound to adopt any submission.

Differential Rate

The Act section 161(1) provides that Council may raise general rates by the application of adifferential rate if it uses the capital improved value system of valuing land, and it considers thedifferential rate will contribute to the equitable and efficient carrying out of its functions.

Section 161 (2) also provides that if Council declares a differential rate it must specify the objectivesof the differential rate and must include:

• a definition of the types or classes of land which are subject to the rate,• a statement of the reasons for the use and level of that rate in relation to those types or

classes of land,• identify the types or classes of the land which are subject to the rate,• if there has been a change in valuation system, any provision for relief from the rate for

certain land to ease the transition of that land,• the characteristics of the land which are the criteria for declaring the differential rate.

Section 161(3) requires Council to keep specified information available for public inspection.

Valuation of Land Act 1960, (“the Valuation Act”)

Sub-section 13DC (4) of the Valuation Act enables a Council from time to time to cause a valuationof all its rateable land to be made and returned.

Sub-section 13 DC (5) of the Valuation Act requires a fresh valuation to be made and returned after1 January and before 30 June in the second year following the last valuation.

Alison LyonManager Governance Services

Documents

FINANCE, CORPORATE SERVICES ANDAgenda ... - City of Melbourne · 6/24/2003 · 2003. Copies of the budget were made available at Melbourne City Council - Town Hall (Ground Floor