But with federal funding and infrastructure projects taken into account, city officials think the budget will still be balanced come the end of the year.
“As long as there’s no further expenditures we’re surprised with we should have that balance to zero,” said Regina Mayor Michael Fougere said of the outlook, which could change by the end of the year.
“Council, myself and administration are looking very closely to ensure that any gaps we have will be dealt with.
The mid-year financial report provides a point-in-time estimate of projected operating and capital revenues and expenditures, and is based on financial performance through the first six months of the year.
When presenting the report to Regina’s Finance and Administration Committee, Executive Director of Financial Strategy and Sustainability Barry Lacey said city administration predicts total operating revenue losses of over $19 million this year.
Much of that, however, was offset by reductions in operating expenditures approved by city council back in April.
Left with a $5.1-million gap, the City plans to use part of $7.2 million in deferred capital programs and projects to close it.
“We’re not concerned at this point about having a deficit. In fact, we’re not allowed to have a deficit, but this will ensure our books will balance,” said Fougere.
The report did, however, highlight some areas of concern.
Regina Exhibition Association Limited (REAL) has had to contend with a cancelled CFL season and the loss of several planned concerts, events and conferences.
The report noted that the pandemic has pushed REAL’s cash flow to a “critical point”, though CEO Tim Reid said losses at the city-owned not-for-profit are projected to be slightly less than the $7 million predicted earlier this year.
“We have seen the Co-operators Centre open up and it’s essentially open today. The AffinityPlex is about to open. So what we’re projecting now is about a $6 million loss,” Reid said.
In expectation of such financial struggles, Regina City Council approved granted REAL access to a $13 million loan guarantee.
Additionally, the City will be advancing REAL’s 2021 Operating and Maintenance payment to the end of 2020 to “enable REAL to meet its payment obligations in the first quarter of 2021”, according to the report.
Looking forward, Reid said his organization is facing a largely unpredictable 2021.
“Going into next year the loss of potential events could be devestating. Our hope is we will see our summer events happen and Farm Show, Queen City Exhibition and Riders games will go forward but that’s dependent upon the health authorities right now,” Reid said.
Concern was also expressed about the sustainability of the 30-year timeline for the Stadium Reserve plan designed to help pay off Mosaic Stadium.
The report estimates that facility fee revenue loss will total in the range of $4 million to $5 million in 2020.
“We are continuing to pay down that debt. We have not, as a city, stopped that yet. SO, there’s no exposure in that regard but the longer term financial model to pay for the stadium is a subject of discussion between us, the provincial government and the Saskatchewan Roughriders.”
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