There is no COVID 19 budgetary vaccine and so the virus is expected to hit the City's finances hard, to the tune of $1.7 million.
That projection is revealed in a staff report that will be presented to council next week.
City departments are required to monitor spending and revenues on an on-going basis and project to the end of the year. Year-end projections are reported to Council on a semi-annual basis.
"COVID-19 related facility closures and other restrictions have significantly reduced the City’s revenues," says the report.
The projection includes total anticipated revenue losses in the amount of $5.3 million, of which the largest reductions are in the user-fee generated revenues within arena services and transit.
Those revenue losses are expected to be partially offset by personnel cost savings of approximately $1.7 million arising from gapping, layoffs and the cancellation of student hiring.
An estimated $212,000 in additional costs is directly related to the pandemic to buy personal protective equipment, cleaning supplies, support remote access for staff working from home, and other infrastructure changes.
"The year-end projection has been prepared based on the assumption that the various restrictions currently in place remain effective for each of the services areas until the end of the fiscal year," continues the report. "However, the status of the pandemic is continually evolving and the projection is subject to significant fluctuations and risks particularly if there is an increase in cases and previously lifted restrictions are re-instituted."
Hardest hit has been Infrastructure and Operations with a projected year-end deficit of $714,912. Factors contributing include lower revenues for environmental services, transit, roads, and parking as well as higher environmental services contact costs.
Community Services is currently projecting a year-end deficit of $585,436 with lower revenues in multiple areas like arenas, parks, leisure services, and planning.
General Government Activities is currently anticipating a year-end deficit of $564,752.
Council has agreed to provide funding for North Bay Jack Garland Airport for the rest of 2020 through the redirection of capital funding from operations and reserves.
On the bright side, mild winter conditions experienced in the spring means winter maintenance will be on budget by year-end. This projection assumes that the later part of 2020 will be similar to 2019.
And the City is saving on fuel. The current fuel budget was set on expected usage at an estimated rate of $1.03 per litre.
"Based on the first six months of the year, the City has realized lower than budgeted fuel rates. Under the terms of the current contract, the City pays pricing based on the Ultramar Daily Toronto Rack Rate. If actual rates and consumption continue to be lower than budgeted values, savings may be realized by year-end. Current estimated fuel savings are $270,773 by year-end if trends continue," according to the report.
The budget projection ends with a warning, however.
"As the global impact of COVID-19 continues, additional future effects on operations are unknown and the duration of any disruptions or the related financial impacts cannot be reasonably estimated at this time."