Council allocates $6.2 million from investments for 2025 budget – DiscoverMooseJaw.com

Moose Jaw city council unanimously approved the drawdown of $6.2 million from the city’s investment portfolio to support the 2025 budget. 

It was a particularly strong year for the city’s investments. As of November 2024, the long-term pool has a return of 16.83 per cent and the moderate-term pool had a return of 11.07 per cent. 

In comparison, when the city invested about $100 million in 2019, the expected return of the city’s long-term portfolio was six per cent, and the average return since inception has been 7.73 per cent. 

Meanwhile, the moderate-term portfolio had a target return of 4.25 per cent and is averaging returns of 5.47 per cent. 

The drawdowns will be used in the city’s budget to fund programs and services. However, it was such a good year for the investments that there was an additional $3.1 million available that had not been earmarked. 

Coun. Dawn Luhning said this shows why the city’s investments are so important. 

“I just want to reiterate how this report, for anyone who thinks that we should be spending those reserves, really needs to think about what the detriment would be to the city if a council in the future decided to spend these reserves and how this benefits our budgeting process to keep taxes down,” said Luhning. 

Of that additional funding, $2.5 million will go towards the general capital reserve. This includes $2.2 million for a shortfall in the 2024 capital reserve. 

“If you remember last year when that came to council, I believe we started off with almost a $9 million deficit in our general capital reserve,” explained Director of Financial Services Brian Acker. 

“Two of the initiatives we had were to generate $1 million in grant funding and $1 million in additional land sale revenue that would fund part of that, and then we had other sources for doing that. Unfortunately, neither of those came to fruition, so we are short that $2 million.” 

Another $300,000 will then go towards funding projects in the 2025 general capital reserve to avoid another shortfall. 

City administration also brought forward using $300,000 for the operations department’s major equipment control account. 

“The public works area basically has utilized all of their major equipment control account. They have needs of about $480,000 from their control account in 2025. Unfortunately, they don’t have that funding. Without that funding, those purchases can’t go forward,” said Acker. 

Of the $3.1 million, that would leave $300,000 left that could be reinvested, or council could use for any one-time projects. Coun. Patrick Boyle said that money could be used to bring down the mill rate increase. 

“This is almost one percentage point on what the increase would be, effectively offsetting. There is no rush in here, but it does represent an actual reduction or potential reduction in what the proposed budget is today. So, to me, that is a net benefit,” Boyle commented. 

Acker did remind council that the general capital reserve is generally funded by other sources besides taxation, and the operations budget would only affect the mill rate. 

Coun. Chris Warren put forward a motion that administration identify opportunities to use investment earnings for one-time expenses in the operating and/or capital budget totaling a minimum of $300,000 for council consideration at a future budget meeting. 

“As much as we heard the overviews, there are a lot of line items here, and certainly there may have been some one-time expenses, but maybe not talked about. It would be difficult for council to identify those in the individual line items,” he said. 

The motion was passed unanimously by council. 

Coun. Heather Eby noted that council shouldn’t rush to spend the money and could choose to use it later down the road. 

“It’s not like we have to spend that $300,000 as soon as the budget is over. If there is not something that we deem we want to do with that right away, we have still 11 months of stuff that could come up,” Eby said. 

Keep checking back to Discover Moose Jaw as city council will continue budget deliberations on Monday starting at 2 p.m. in council chambers at City Hall.