Cochrane's growth surged unexpectedly in 2021, resulting in a $3.2 million surplus for the town.
Audited financial statements and the Town's fourth-quarter financial report for the year was presented to councillors during the April 25 council meeting.
A mid-year jump in the construction of new homes and real estate sales turned the Town's expectations on its head where little growth was expected, and sales and development trends are expected to continue into 2022.
Municipal revenues surpassed expectations by $1.9 million due to high growth.
User fees and taxes generated $455,000, while permit sales for new and renovated homes increased $647,000.
Over $311,000 of the surplus revenue came from operating grants and investments, and $232,500 was from general revenue. Fines and penalties were also $273,000 over budget.
A total of $673,000 of the $1.3 million in unexpected cost savings, however, was due to reduced staffing levels and training, according to the Town's financial services manager, Tanya Galon.
"The savings in staff and staffing costs are not sustainable, especially with significant pressure on Town resources due to a growing population," said Galon.
Another $313,000 came from a later than anticipated debenture draw, she added. Legal costs were down as well, to the tune of $199,000, while RCMP policing costs saw a decrease of $105,000.
Other cost savings were from fewer instances of Town staff travelling to conferences due to the COVID-19 pandemic, supply chain issues and manufacturer delays, and other pandemic-related impacts to remote work.
A shift from in-person to virtual activities during the pandemic led to a $117,000 drop in operating expenses.
The entire $3.2 million surplus will be transferred into reserve accounts, many of which have taken a dip or were expecting to see draws from the 2022 budget.
"It does provide the municipality of Cochrane an opportunity to have money in a savings accounts that we wouldn't have had before," said Town corporate services executive director, Katherine Van Keimpema.
"There's $3.2 million more in our savings account and earlier this evening, I talked about how our reserve balances are decreasing."
Van Keimpema indicated the forecast of these tax savings continuing into the future is unlikely, however.
In total, $1,225,000 will be added to the operating reserve to be accessed for staffing increases this year. The same amount would have been withdrawn from reserves even without the surplus.
The infrastructure gap capital reserve will receive $600,000 — an amount that was removed by council from the 2022 budget.
A total of $300,000 will be transferred into the human resources operating reserve to help fund the 2022 compensation review planned for this year.
A total of $200,000 will be transferred into the planning operating reserve to fund future Municipal Development Plan work.
The $105,000 savings from RCMP policing costs will be put into the police operating reserve and the remaining surplus balance of $791,842 will be transferred into the facilities capital reserve. That reserve, according to Galon, currently has a significant negative balance of $3 million.
The question of how to communicate the surplus to the public, with plans to put all of it back into reserves while still implementing a 10 per cent residential tax increase, was a big topic of discussion among the councillors.
"A $3 million-plus surplus is really good news and when I first heard it, I was like 'Oh, could this make things better for your tax bill?'" said Coun. Tara McFadden. "But I think it's important to show how much we've depleted our reserves.
"The depletion of those reserves has been well-spent and well-invested in the infrastructure and the people power that we need to make things happen, but I think that was really, for me — in understanding this conversation tonight — that graphic was a really powerful part of the communication."
