Halifax auditor general concerned over $182M in reserve funds

Halifax has $182 million in reserve funds spread over 53 accounts, and the city's auditor general is worried about how they're handled.

"Let's make sure we're very clear to the taxpayers as to why each and every one of those reserves is needed," LarryMunroesaid Friday.

Reserve funds are used to save for a large project or as an emergency backup for an environmental cleanup or an extra snowy winter.

Munroe does not dispute the need for reserve funds, but he points out that Halifax has a number of funds that overlap.

Eight funds haveno business plan.Less than half of the funds have minimum or maximum amounts.

Concerns over money handling

Munroeis also worried about how the reserve funds are handled, particularly when it comes to transferring money either into the operating budgetor between funds.

To cover off a deficit in the 201415budget, transfers were made from five reserve funds.

In his latest report, Munroe notes that shifting money from the sale of capital assets reserve to the culture development reserve is likely a violation of the HRM charter.

"I expected to see detailed information on the impact of the reserves or plans for replenishment, but we simply didn't see that," hesaid.

Onecouncillorwas surprised to learn the total amount of the city's reserve funds.

"I'm stunned," said RegRankin,councillorforTimberlea,Beechville, and Clayton Park West.

"I haven't asked enough questions and that's my fault," said Gloria McCluskey, councillor forDartmouth Centre.

'It's an ongoing process'

Munroe's report includes 30 recommendations for improvements.

John Traves, Halifax's acting chief administrative officer, says finance staff are working on new policies to better manage the reserve funds.

"It's an ongoing process," Traves said. "We'll keep looking at it. Like everything, it's going to be something that we're going to continue to revisit over time."

Munroe also wants council to take on more responsibility when it comes to monitoring reserve funds. The councillors who are members of the audit and finance committee agreed with that suggestion.