Financial Overview October 22, 2009

1.Economic Update 2.Financing Strategies  Multi Sport Facility  EMS Headquarters  Brookdale Watermain  RINC Projects  Secondary Waste Water Treatment Facility  Infrastructure Ontario 3.Progress Fund Overview

Economic Update

Consumer Price Index (CPI) The Bank of Canada has a target for inflation (CPI) to be maintained between 2% and 4%.

Interest Rates Summary of Recent Interest Rate Cuts by the Bank of Canada Short term interest rates are at historical lows. The Bank of Canada has committed to keep the overnight rate at current levels until July There is a risk that interest rates will rise in the later part of 2010 depending on economic indicators such as inflation (CPI).

Financing Strategies

Multi Sport Facility Estimated Project Cost: Land$ 1,321,921 Engineering, Design, Consulting 1,367,500 Other Project Costs 997,667 Estimated Class “D” Construction Budget 28,751,000 Total$ 32,438,088 Sources of Funding: Federal Funding $9,221,465 Provincial Funding 9,221,465 “3 + 1” Fundraising Commitment 2,000,000 City of Cornwall 11,995,158 Total$ 32,438,088

Multi Sport Facility con’t Financing required $11,995,158

Multi Sport Facility con’t

EMS Headquarters Estimated Project Cost: Land$ 0 Engineering, Design, Consulting 403,495 Estimated Class “D” Construction Budget 4,696,505 Total $ 5,100,000 Sources of Funding: Federal Funding $1,700,000 Provincial Funding 1,700,000 City of Cornwall 1,700,000 Total$ 5,100,000

EMS Headquarters con’t Financing required $1,700,000

Brookdale Watermain Estimated Project Cost: Total $ 2,100,000 Sources of Funding: Federal Funding $ 700,000 Provincial Funding 700,000 City of Cornwall 700,000 Total$ 2,100,000 NOTE: The City’s portion of the cost for this project could be funded by the Waterworks 2010 budget.

RINC Projects Estimated Project Cost: Multi-Purpose Room (Aquatic Centre)$ 250,000 Gymnasium (Aquatic Centre) 1,850,000 Splash Pad - St. Theresa Park 250,000 Lights – Reg Campbell Park 225,000 Total $ 2,575,000 Sources of Funding: Federal Funding $ 857,475 Provincial Funding 857,475 City of Cornwall 860,050 Total$ 2,575,000

RINC Projects con’t NOTE: Annual principal and interest payments could be funded via the Parks and Recreation operational budget.

Secondary Waste Water Treatment Facility Estimated Project Cost: Total $ 55,500,000 Sources of Funding: Federal Funding $18,500,000 Provincial Funding 18,500,000 City of Cornwall 18,500,000 Total $ 55,500,000

Secondary Waste Water Treatment Facility con’t Approximate Financing required $11,260,000 The City has a restricted reserve for the Secondary Waste Water Treatment Facility. In 2009, there was a contribution to reserves in the amount of $950,000. If the same approximate budget was established in 2010, 2011 & 2012 there should be the capability to match the same contribution to reserves without having a significant increase in sewer rates.

Secondary Waste Water Treatment Facility con’t The annual principal and interest payments above could be funded through the Sewer budget. These payments could be offset by the amounts that have already been incorporated in sewer rates that were used historically as contributions to the reserve.

Project Summary Total Projects = $96,713,088 Long Term Financing: Multi Sport $11,995,158 EMS 1,700,000 RINC 701,400 WWTP 11,260,000 Total $25,656,558

Infrastructure Ontario Provides the most competitive rates for municipalities for long term financing up to a term of 40 years Fixed rates are guaranteed for the term of the loan Fixed rate loans are “closed” meaning there is no ability to make lump sum payments or prepay the loan Construction loans are available for a term of up to 5 years at a floating rate which is currently less than 1% A construction (variable) loan can converted to a long term loan at any time, this can also be done in increments or as one lump sum The approval process takes 6 to 8 weeks once a completed application has been submitted by The City of Cornwall

Progress Fund

Past Utilization of the Progress Fund Interest

Current Status of Progress Fund & Future Commitments There is a commitment to use interest from the Progress Fund as a contribution to the Hospital Reserve in the amount of $4,400,000. The City of Cornwall is paying monthly installments of $200,000 and will continue until July 2012.

History of Investment Income on the Progress Fund