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We are here because Section 166 of British Columbia’s Community Charter states that we must have public consultation regarding the proposed financial plan for the year, this one formal meeting. This gives the public an opportunity to see what major projects are planned for the upcoming year and what their estimated costs will be. This also gives the public an opportunity to provide feedback whether it be positive or negative, as both can be useful. The timing of this presentation is before the 2015 year end results are known. With the exception of work in progress and items needing early authorization, the 2016 capital items are proposed and estimates only. Because of the cash flow challenges we are faced with in 2016, projects will be prioritized and moving forward only as cash is available. During the early part of the year before the current financial plan is adopted, we operate under the authority of the financial plan adopted in the previous year, which makes provision for operations in a 5 year period. This presentation will deal with operations in an overview only. 3
In order that we remain aware of future needs we review the effects of the capital and the reserve plans out to 20 years. 4
Sparwood undertook to renew their Official Community Plan (OCP) starting in 2013 and the OCP bylaw was adopted in 2015. This plan is the formal communication from the community on where they want to be in the future. 5
With the adoption of the Official Community Plan, strategic planning is undertaken. During the strategic planning we chart a course that is intended to lead to the goals set by the Official Community Plan. As financial plan projects are brought forward for consideration, they will be assessed on how well they head in the direction set by the OCP. Some items will be more concerned with keeping the District operating effectively and will be neutral in relation to the OCP. However, some proposals may conflict with the OCP and should be reconsidered. This is especially true of capital items, which once built or purchased may serve to frustrate the goals set by the OCP for many years. Local government operations gather a significant momentum and just like an ocean liner cannot stop or change direction very quickly. Our present course may already be heading in the general direction that the new OCP will identify, so a major change of direction might not be needed. It may take one or two budget cycles before a shift of direction is seen. 6
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The following slides are to give you an idea of where all of the taxes that are collected get distributed and who is paying. Sparwood does not get to keep everything it collects! 8
It should be noted that not all of the taxes that are paid to the District of Sparwood belong to the District. This chart shows that of the total 2016 taxes to be collected in Sparwood ($12.4M) only 55.9% is available for the District’s use. 2015 Allocation of Sparwood Taxes EV Mine Pool - Fernie, Elkford & Area A $1,884,029 EV Mine Pool - Sparwood $2,938,252 District of Sparwood General $3,984,723 Regional Hospital District $177,398 RDEK - general $266,862 EValley Waste - closure & debt $176,671 School taxation $2,501,560 Police $335,206 BCAA & MFA $109,782 TOTAL $12,374,483 9
Note that until 2008, the Mine Tax Pool percentage share of taxes reduced as all other percentage shares increased to cover the difference in taxes. 2008 was the first year of the new Mine Tax Pool Agreement. The Mine Pool taxes will increase or decrease in future years by the lesser of CPI and the average tax increases in the Elk Valley. Prior to the new Agreement, the mine taxes were frozen at the same dollar amount. In order to balance the budget, everyone else was paying a greater share of the total taxes. Subsequent to the new agreement, the mine share of the total is still reducing gradually, but this time the reason is that our residential tax base is growing as a result of the new developments in the Whiskey Jack area and new business investment 10
To see how our taxes and utilities compare with surrounding communities we have been tracking four similar homes in these communities from year to year. Sparwood’s total taxes and fees continue to be reasonable in comparison to its neighbours. Please note that these are not always perfectly comparable numbers as each area’s taxes are used to fund different things. For example, the Crowsnest Pass taxes help fund their ambulance service. The results are affected by the assessed value. The sample home is located in lower Sparwood. 11
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These are some of the operational items that Staff and Council are working on to ensure that Sparwood moves forward. 13
The debt repayment relates to - the Michel Creek Road water extension and is being paid by the benefitting parcels and - MFA loan to finance to the loader purchased in 2015. Other Protection includes Bylaw Enforcement, Building Inspection, Animal Control & Emergency Planning Other Community Development includes Miscellaneous studies, Tourist Information Centre, District Float, Fibre operation & Coal Miner Days Parks and Recreation including Library, Heritage, etc. Public Health includes Mosquito control and Cemeteries 14
Taxation is 56% of our revenue, while user fees are 36%. The remaining 21% is from various other sources, such as grants. 15
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As with your house or vehicles, there comes a point where they must be replaced because they are either costing you too much money to repair or they need to be updated to keep up with current regulations. There are always new rules and regulations being set by various levels of government that the District must adhere to. We must also consider the future and develop infrastructure strategically. Often there are Government Grants available to help fund projects, but in the current economic downturn they are often coming up on short time lines and need proof that they have Council authorization and that the District’s share of funds are available. An example of this was the Stimulus Funding for the CPR Overpass and Link Trail. Capital budgets in any one year may contain many more projects than actually move forward just so that we are able to take advantage of potential funding opportunities. 18
It is the future residents of the community that benefit from these larger, long term projects. Therefore, they are typically the ones that pay for them over time by paying back the borrowed funds. The District does have a Local Improvement reserve that can be used for very small projects and avoid the significant amount of administration that the borrowing process requires. 19
Some projects will be reduced, some will be handled through operations, some will be deferred until funding is available. Other requests will be rethought – there may be other ways of accomplishing what we need without a capital outlay. The following capital items are still subject to change, and some may only proceed if grant funding is approved, e.g. the skate park. 20
These figures are preliminary estimates and will be fine tuned before the financial plan is final. 21
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Presently we offer tax exemptions for Hotel, Conference facilities, Mall redevelopment and redevelopment of the old RCMP building. We will extend the program for early adopters within the downtown core revitalization area. In light of the current economic outlook on local pricing, the Business Development contract was refocused on communication, and concludes in April. 28
That concludes much of the budget items and related taxation. The following slides are provided for informational purposes to help you understand how some of the other functions that many of us take for granted, operate and are paid for. 29
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2015 and 2015 were not representative years regarding the average snowfall pattern for Sparwood, with costs and work performed being low due to the low snowfall. Council will reconsider this program late rthis year, as it is the last winter of a 3 year pilot. 33
Accommodating additional Capital Projects or Operational Changes needs sufficient lead time for Staff and Council to consider and plan. Thank you for your time. 34
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