Minutes - December 7, 2021 - Finance and Facilities Committee Meeting

Members Present:

Mr. Matt Reid (Chair)
Ms. Aina DeViet
Ms. Maureen Cassidy
Ms. Tino Kasi

Regrets:

Mr. Aaron O'Donnell

Others Present:

Ms. Carolynne Gabriel, Executive Assistant to the Board of Health (Recorder)
Ms. Stephanie Egelton, Senior Executive Assistant to the Medical Officer of Health/Associate Medical Officer of Health
Dr. Alexander Summers, Acting Medical Officer of Health
Ms. Emily Williams, Director, Healthy Organization/CEO (Interim) Mr. David Jansseune, Assistant Director, Finance
Mr. Brian Glasspoole, Manager, Finance
Ms. Mary Lou Albanese, Director, Environmental Health and
Infectious Diseases

Chair Matt Reid called the meeting to order at 9:02 a.m.

Disclosures of Conflict of Interest

Chair Reid inquired if there were any disclosures of conflicts of interest. None were declared.

Approval of Agenda

It was moved by Ms. Maureen Cassidy, seconded by Ms. Tino Kasi, that the AGENDA for the December 7, 2021 Finance & Facilities Committee meeting be approved.
Carried

Approval of Minutes 

It was moved by Ms. Aina DeViet, seconded by Ms. Cassidy, that the MINUTES of the November 11, 2021 Finance & Facilities Committee meeting be approved.
Carried

New Business

Q3 Financial Update and Factual Certificate (Report No. 25-21FFC)

This report was introduced by Ms. Emily Williams, Direction, Healthy Organization / CEO (Interim). Ms. Williams highlighted two key points: MLHU is projecting a surplus for year-end Q4 and the Ministry has directed MLHU to use any surplus funding from mandatory programs to pay for COVID-19 expenditures. Ms. Williams then introduced Mr. David Jansseune, Assistant Director, Finance who shared a slideshow presentation.

Mr. Jansseune shared the following highlights for Q3, which ended September, 2021:
• The Ministry has provided direction to apply surplus from mandatory programs to COVD-19 expenditures. The estimated amounts is $1,527k by the end of the year.
• Projected funding surplus by the end of the year is $24k.
• The forecast includes strategic investments in Q4 totaling $735k.
• Funding requirements were reduced for both the City of London and Middlesex County totaling about $762k.

The Q3 actuals included:
• Total actual expenditures ending September 30, 2021 were $44,907k, including COVID-19 expenses of about $23,199k, of which, seconded staff amounted to $3,390k, giving a net incremental COVID-19 costs of $19,808k.
• Ministry funded $13,782k in July for COVID-19 expenditures.
• Seeing favourability in staffing gaps, reduced travel and staff development, lower professional services, and reduce program supply costs.
• The continued focus on COVID-19 has delayed the restart of many programs and these delays are expected to continue over the next three to six months. Surplus as a result will be applied to COVID-19-related expenses.

Forecasting until the end of the year included:
• Total forecasted expenditures amount to $59,154k.
• Forecasted surplus is $24k and includes:
o $145k for IT expenditures, including updating two new servers and new laptops.
o $340k for corporate initiatives.
o $250k for unknown Q4 expenses and/or reserve planning.
o $640k funding reduction from the City of London, from $6,735k to $6,095k.
o $122k funding reduction from Middlesex County, from $1,283k to $1,161k.
o $1,527k program surplus shifted to fund COVID-19 expenditures.
• COVID-19 expenditure forecast includes $26.4 million, excluding seconded staff which would be funded by $24.9 million funding from the Ministry and $1.5 million funding from program surplus.

Mr. Jansseune also articulated that the Factual Certificate is a certificate to acknowledge that key financial and risk management functions are performed in an accurate and timely manner.

Discussion on this report included the following:
• The difference between the amount of COVID-19 expenditures and the amount of funding received by the Ministry is because the total COVID-19 expenditures include forecasted numbers until the end of the year and the funding from the Ministry is the amount actually received up to November 2021.
• Any program surplus not directed toward COVID-19 expenditures may be used to pay down the variable portion of the Health Unit’s debt.
• It has been the historical practice of the MLHU to return money to the City of London and Middlesex County and over the past 12 years the Health Unit has returned $4.5 million through efficient operations at the Health Unit.

It was moved by Ms. Cassidy, seconded by Ms. Kasi, that the Finance & Facilities Committee make a recommendation to the Board of Health to receive Report No. 25-21FFC re: “Q3 Financial Update and Factual Certificate” for information.
Carried

Financial Borrowing Update (Report No. 26-21FFC)

This report was introduced by Ms. Williams who highlighted that the Health Unit is in a positive cash position in Q3 as opposed to Q2 due to funding received from the Ministry. Ms. Williams turned the presentation to Mr. Jansseune who shared a slideshow presentation.

Highlights of the report included:
• MLHU had a positive cash balance as of July, 2021.
• The Health Unit paid for COVID-19 expenses which depleted cash resulting in the line of credit to be used from February to July, 2021. Ministry funding received in July returned MLHU to a positive cash position.
• The $8 million line of credit the Health Unit has is not currently being utilized and to date have seen $137k favourable interest expenses compared to what was budgeted.
• No changes to the bank loan and there is approximately $4,047k owing, $1,102,083 owing on the variable component as of November and $2,944,850 owing on the fixed component as of November.
• The loan renews on December 2025 and its amortization period is 20 years.

Discussion on the report included:
• The borrowing costs incurred while using the line of credit for COVID-19 expenses can be claimed as a COVID-19-related expense for reimbursement from the Ministry.
• MLHU is in conversation with the Ministry to ensure compliance with the direction to use surplus funds from mandatory programs to pay for COVID-19 expenses. The Health Unit would like to put any remaining surplus funds towards the variable portion of the loan.

It was moved by Ms. DeViet, seconded by Ms. Cassidy, that the Finance & Facilities Committee make a recommendation to the Board of Health to receive Report No. 26-21FFC re: “Financial Borrowing Update” for information.
Carried

Other Business

The next meeting of the Board of Health Finance and Facilities Committee is to be determined in 2022.

Adjournment 

At 9:23 a.m., it was moved by Ms. Cassidy, seconded by Ms. Kasi, that the meeting be adjourned.
Carried

Matthew Reid
Chair

Alexander Summers for Christopher Mackie
Secretary-Treasurer