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Abbotsford finances and reserves ‘in good shape’

Financial assets much improved since 2011 infrastructure projects pushed city into red
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Abbotsford City Hall

The financial health of the City of Abbotsford has greatly improved in recent years, Mayor Henry Braun said Wednesday morning at the third annual Mayor’s Breakfast.

The net financial assets of the city, which were in the negative just five years ago, grew by $41 million to $144 million in 2016. It’s a far cry from 2011, when the city’s finances were $17.8 million in the red. The financial assets indicator are a measure of cash and investments compared to the city’s debt.

“From my time as mayor I’m most proud of the net financial assets turnaround we’ve accomplished,” he told hundreds at Tradex on Wednesday after showing a chart with steadily rising asset levels.

At the breakfast, and at council earlier this month, Braun commended staff for the move into the black.

It was a continuation from Braun’s remarks made earlier this month at council.

“I don’t think we can over-emphasize what’s happened since then and what that communicates to people who want to invest significant money in our community,” Braun had told council. “Any business that’s worth its salt is going to be looking at our financial statements, our balance sheet in particular, to see what is the health of this government, this city.”

The decline of assets in 2011 was due to several major infrastructure projects, including the completion of the McCallum and Clearbrook interchanges, upgrades to the water meter system, expansion of the JAMES Treatment Plant and several other significant undertakings.

Since then, net assets have risen each year, with the city moving into positive territory in 2013 and adding further to its financial assets in subsequent years.

Abbotsford’s four different capital reserves have all grown significantly in recent years. Those reserves include money set aside for water, sewer, airport and general capital projects. The general capital fund is the largest, and grew by $13.6 million last year, to $61.9 million.

“Our reserves are in good shape, they look healthy,” Raj Sharma, the city’s finance and corporate services general manager, told council while presenting the city’s annual report.

Braun said: “This didn’t happen by accident. This takes hard work, a lot of discipline … I just want to commend the entire organization because we are in a much healthier place financially than we were not that many years ago, so kudos to staff.”

The city as a whole saw a surplus of $23.7 million in 2016. In 2015, the surplus was $37.2 million. Some of that money has already been set aside for major capital projects that have not yet begun, including the Vye Road interchange.

Last year also saw the city pay off the last of utility debt originally incurred by the Fraser Valley Regional District and then transferred to the City of Abbotsford.