Reserves and long term liabilities

The City of Calgary’s Reserves and Long-Term Liabilities Balances 2024 presents detail on all reserves and long term liabilities including:

  • funding sources,
  • any conditions and restrictions on use, and
  • a summary of activity in each of the last two years.

Purpose of reserves

The City sets aside money in reserves to cover future operating and capital expenses, handle budget shortfalls or respond to emergencies.

Each reserve is approved by Council in a report that identifies the purpose, conditions, restrictions and funding source for that reserve. As a result, most reserve funds are committed to specific projects and activities.  The City reviews every active reserve at least once every three years. 

Background

Reserves are part of sound financial management that allows funds to be spent carefully over time or to ensure service levels are maintained should unexpected events or revenue fluctuations occur.

Using and managing reserve funds through a formal policy is a best practice in major cities and supports Calgary’s strong AA+, AA (high) and Aa1 Stable credit ratings from three globally recognized rating agencies.

A properly balanced approach to the planning and use of reserves is considered sound financial management and is a key component of The City of Calgary’s strong credit rating.

Reserve Categories

The City’s reserves consist of Operating, Capital and Sustainment reserves. A summary and definition of these categories are as follows:

  • Operating reserve – Used to fund operating expenditures for one-time projects, pilot programs; stabilize operating budgets for unanticipated fluctuations in revenues or expenses; comply with contractual agreements; or for operational emergencies. Included is the Fiscal Stability Reserve, which serves as a contingency fund for operational emergencies, urgent or contingency capital expenditures, and to compensate for unplanned revenue reductions with significant financial impacts.
  • Capital reserve – Used to fund approved capital programs, projects and expenses. Most of these reserves are either fully committed or have substantial commitments against them to finance existing approved projects.
  • Sustainment reserve – Used to fund both operating and capital expenses for activities that are treated as self-sustaining. Most of these reserves are either fully committed or have substantial commitments to finance existing approved projects.

More information

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