Vernon City Council has revealed that 2006 was a good year financially for the city. A very, very good year. At the finance meeting on Thursday the city made it known that the net surplus for 2006 was $1,554,204. “It‘s a ridiculous amount of money,” said Coun. Barry Beardsell, “I was expecting a surplus but nothing of this magnitude. Usually you end up with a surplus of $50,000 or $100,000.” While this may seem like a pleasant surprise, Beardsell said he is not sure the public will view it as such, especially after the raise in residential taxes this year. “A lot of people will be saying, ’If (council) has got so much money then why not cut my taxes?‘” said Beardsell.Coun. Patrick Nicol feels that citizens of Vernon will be more understanding. “Citizens always appreciate when they get something for their hard-earned tax dollars, and they‘ll see that they get that,” said Nicol, noting that much of the surplus will go towards the redesign of Middleton Way. “It‘s a matter of balance, we have big projects with considerable expenditures that need to be addressed,” said Nicol. While the sources of the surplus will not be made public until Thursday‘s finance committee meeting, it is known that approximately $440,000 has come from development fee revenue that was not budgeted. Councillors are aware that citizens may criticize the city for deliberately underestimating growth in order to secure a large surplus. According to Nicol, this is partly true. “The growth percentage we chose was us being conservative,” he said. “There was a very healthy debate on the percentage and maybe we were overly cautious.” Under a new accounting system known as Generally Accepted Accounting Practices (GAAP), the funds have been temporarily allocated to various reserve accounts until a full review of the city‘s reserve account system happens later in the year. The GAAP system must be used due to legislation enacted by the provincial government in the wake of the Enron scandal in the U.S.
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