Financial proposal up to bat

Times Contributor

 

Pat Leich, Chief Financial Officer for Wheatland County, hit a pop fly when she presented an option to open up investment opportunities with banks that did not give a 100 per cent guarantee on funds invested. Wheatland Council was on the ball and stopped the proposal from gaining momentum.

“You can have some risk, no risk, or open up to a competitive market,” said Leich.

She said there were options the county hasn’t taken that were available to them, still compliant with the Municipal Government Act. Opening up to other banking institutions would increase returns, give bids that are more competitive and boost compensation rates. She was confident in the stability of the major Canadian banks.

“What we see is people looking to credit worthiness in making investments. Currently the banks credit ratings have been better than the provinces’,” said Leich.

She said increasing investments to longer terms would beneficial. The county currently deals with Alberta Treasury Branch and Chinook Credit Union and invests in short term and one year plans. Leich said that other banks utilized Canadian Insurance Deposit Corporation that insures $100,000 of lost investments on defaults. Several financial advisors were asked to be present for council questions.

“If we plan to get high rates, we will miss them every time,” said Reeve Glenn Koester on the day to day variations in the market. 

“The amount of risk we are prepared to take depends on the tolerance around this table,” said Councillor Ben Armstrong, of Council’s role in the decision. “Once you open the gate, how hard is it to move into areas of more risk.”

He raised the occurrence of investment crisis all over the world and closer to home in the United States. He did not have faith that similar circumstances could not occur in Canada.

All councillors agreed caution was necessary with ratepayer money. It was discussed that rates would only be one or two per cent rate more and returns would not be very significant for the risk incurred.

Leich’s second proposal hit a home run. 

She knocked out a strategic plan for payment consolidations to be done by the bank instead of staff and gave it speed by delivering the addition of purchasing cards used for staff purchases. She tapped all bases indicating the plan would free up staff time in accounting data entry, give better data feedback, provide cash rebates, access to a credit line and provide direct pay opportunities for municipal vendors. She avoided being tagged out by suggesting checks and balances could be built in to prevent misuse, while retaining the current practise of supervisory control on expenditures. Contracts would be set up outlining responsibilities and penalties for those using cards. Policy would have to be written surrounding the plan. Council would still have to approve expenditures. 

“Misuse would mean an automatic termination,” said Chief Administrative Officer Alan Parkin, who had seen similar policies set in other municipalities and organizations.

The run hit the scoreboard when councillors approved the strategic plan, with the condition that appropriate policies were developed. They approved Chinook Credit Union could provide the services, as other vendors did not provide all the options desired.