Norfolk’s financials show signs of improvement

Luke Edwards

Grant Haven Media

An operating surplus of more than $10 million in 2025 was another sign of improving financial conditions in Norfolk, an audit of the county’s books found.

However, despite the improving situation, auditors and county staff said more needs to be done to get Norfolk on solid financial footing. Namely, an annual funding shortfall of $33.6 million and a need to improve reserve levels that remain below ideal levels are areas the county should focus on, they said.

“Having a county that has those reserves… at their fingertips, it is better than a county that doesn’t have that,” said Matt McInally, a partner at Millard, Rouse & Rosebrugh LLP.

The operating surplus totaled $10.2 million, with the bulk of it - $9.7 million - found in the levy. Norfolk directed most of the surplus to debt mitigation, using the money to fund approved projects that were otherwise planned to be debt financed.

“Using surplus funds when available reduces future borrowing requirements and lowers future debt servicing costs,” said treasurer and director of finance Amy Fanning.

While most of the surplus was used for debt mitigation, the county also bumped up various reserves. Additionally, earlier this year council voted to use $1 million of the surplus to complete additional road rehabilitation work this year following a brutal winter that left roads in rough condition.

The $500,000 operating rate surplus went into reserves.

Fanning said salary and benefit variances drove most of the surplus, followed by increased taxation revenue and interest and investment income.

However, the treasurer urged for continued restraint.

“While it’s an extremely positive step and momentum is in the right direction, those are all wonderful things,” Fanning said. “Having those balances is incredibly critical and crucial to the long-term health of this organization because we know we’re embarking on significant capital and infrastructure needs going forward as well.”

An accompanying report and presentation at the July 14 meeting showed a positive year for Norfolk’s investments, as well, driven largely by strength in the Canadian markets.

“It’s not often we get to say Canadian equities are the star performers but that’s what we saw in 2025,” said CIBC’s Ian Murray.

A staff report said Norfolk’s returns for short term investments in 2025 totaled 3.33 per cent, or just over $2 million, while medium term investments returned 4.4 per cent ($8.3 million) and the long-term Legacy Fund investments brought a return of 12.81 per cent, or $10.3 million.