Rotorua Council's surplus grows $2.7 million to $10.3 million

Rotorua Lakes Council building. Photo / Andrew Warner

Rotorua Lakes Council's coffers remain in the black with another year-to-date surplus.

As of the end of May, the surplus was more than $10.3 million.

It follows the April year-to-date result, which was a surplus of $7.6m following eight months of deficits.

An organisational financial update for this week's Council Operations and Monitoring Committee said the surplus was now $10,347,000, against a budgeted surplus for the same period of $26,073,000.

The update report said the organisation had been able to mitigate the challenges of the global economic environment while still delivering its services to the community.

The largest variance to the budget - $12m – related to capital subsidies, the report said.

The remaining shortfall of $3.5m was "driven" by the ongoing impact of Covid-19 on fees and charges, and operational expenditure.

"Prudent cost management initiatives are still under way across Council with the forecast operating result to be within $1.5m of budget," it said.

Total revenue was unfavourable against the budget, and the report said this was due to the timing of capital grants and subsidies as well as reduced fees and charges, particularly parking, lease rental income, and venue hire.

"While there may be further impact on fees and charges, we anticipate better results in future months."

Rates revenue was "marginally" ahead of budget due to seasonal water meter billing, and lower than anticipated rates remissions.

Expenditure was also unfavourable, impacted by the council's $1m QE Health redevelopment project grant, consultancy fees, contractor spend, legal fees from the "landfill [case] and advice for emergency housing and representation bill", the community resilience fund, and security initiatives for community safety.

The report said the council had spent $73m on its capital works programme for the year to date, and the report said inflation and logistical challenges were starting to impact its delivery.

A list of where that spending had gone in the council report said $14.6m was spent on the Sir Howard Morrison Centre, $10.6m on the lakefront and $1.3m on the Aquatic Centre.

A further $8.1m was spent on stormwater improvements, $10.9m on transport improvements, $4.6m on IT solutions, $3.1m on water supplies works and $12.4m on wastewater works.

That list of projects totalled about $65.6m.

Projected capital spend on infrastructure and community amenities was expected to hit $83m by year-end.

On May 31, the council had a debt of $296m, and cash in hand of $30.2m.

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