2006 OPERATING BUDGETS 2006 OPERATING BUDGETS MARCH 6, 2006 PRESENTATION MARCH 6, 2006 PRESENTATION
AGENDA AGENDA � Looking Back Looking Back � � Today Today’ ’s City s City � � Understanding and Addressing Budget Understanding and Addressing Budget � Pressures Pressures � Getting Ready for Tomorrow, Today Getting Ready for Tomorrow, Today � � Looking Forward Looking Forward � � Consolidated Consolidated � � Tax Rate Based Tax Rate Based � � User Rate Based User Rate Based � � Next Steps Next Steps �
LOOKING BACK LOOKING BACK
2005 PROGRESS ON 2005 PROGRESS ON PRIORITY INITIATIVES PRIORITY INITIATIVES � BMO announced construction of 325,000 BMO announced construction of 325,000 � sq. ft. state- -of of- -the the- -art data centre art data centre sq. ft. state � Downtown Commercial Master Plan Downtown Commercial Master Plan � approved approved � Cultural Plan undertaken Cultural Plan undertaken � � Collier St. Parking Garage plans Collier St. Parking Garage plans � developed developed � Holly Recreation Centre green Holly Recreation Centre green- -lighted lighted �
2005 PROGRESS ON 2005 PROGRESS ON PRIORITY INITIATIVES (cont’ ’d) d) PRIORITY INITIATIVES (cont � Amendments to Industrial section of Amendments to Industrial section of � Zoning By- -Law approved Law approved Zoning By � Commenced implementation of Phase II Commenced implementation of Phase II � of the Value for Service Delivery Review of the Value for Service Delivery Review � Gateway Signage along the Highway 400 Gateway Signage along the Highway 400 � Corridor approved Corridor approved � Ongoing discussions with Province Ongoing discussions with Province � regarding GO Transit service regarding GO Transit service
2005 SURPLUS ANALYSIS 2005 SURPLUS ANALYSIS Investment income/penalties on taxes $2.2M Investment income/penalties on taxes $2.2M Tax additions and payments in lieu 1.5M Tax additions and payments in lieu 1.5M Other increased revenues 0.9M Other increased revenues 0.9M Reduced expenditures 1.7M Reduced expenditures 1.7M Land ambulance (0.8M) Land ambulance (0.8M) Reduced revenues (1.7M) Reduced revenues (1.7M) Increased expenditures (0.3M) Increased expenditures (0.3M)
TODAY’ ’S CITY S CITY TODAY
“PROGRESSIVE AND PROGRESSIVE AND “ COST- -EFFECTIVE EFFECTIVE ” ” COST “The City of Barrie is found to be positive, progressive and The City of Barrie is found to be positive, progressive and “ proactive in providing services and administrative functions” ” proactive in providing services and administrative functions (Source: Value for Service Delivery report by TkMC) (Source: Value for Service Delivery report by TkMC) “City of Barrie selected as Southern Ontario “ City of Barrie selected as Southern Ontario’ ’s lowest cost business s lowest cost business location” location ” (Source: Canadian Business Magazine (Source: Canadian Business Magazine – – Oct 2003) Oct 2003) “Barrie has one of the most balanced municipal tax systems Barrie has one of the most balanced municipal tax systems… … “ providing the City with a real competitive advantage” ”. (Source: . (Source: providing the City with a real competitive advantage Canadian Federation of Independent Businesses) Canadian Federation of Independent Businesses) “Canada is still the overall lowest business cost location and Ba Canada is still the overall lowest business cost location and Barrie rrie “ ranks third in Ontario in terms of competitiveness” ”. (Source: . (Source: ranks third in Ontario in terms of competitiveness KPMG’ ’s 2004 Competitive Alternative study) s 2004 Competitive Alternative study) KPMG
2005 NET LEVY PER CAPITA 2005 NET LEVY PER CAPITA COMPARISON COMPARISON 1,200 1,000 800 Dollars AVERAGE 600 BARRIE 400 200 0 Whitby Barrie Guelph Oshawa Vaughan Burlington Average Oakville Newmarket Richmond Hill Cambridge Pickering St Catharines Municipality Source: BMA Consulting Ltd.
2005 RESIDENTIAL 2005 RESIDENTIAL TAX COMPARISON TAX COMPARISON 4,000 3,500 3,000 2,500 Dollars 2,000 AVERAGE 1,500 BARRIE 1,000 500 0 y h e n e e a e n t b g l i e s w a p l l g r g o n i l t H e h r k i a i l t a e a d v h i n r g g r r h u B i a d k W e i e r n u m r s G b n a k a v O a i O m l o A c h r w V m i u P t a e a B C N h C c i t R S Municipality Source: BMA Consulting Ltd.
2005 INDUSTRIAL 2005 INDUSTRIAL TAX COMPARISON TAX COMPARISON 3.00 2.50 Dollars (per sq ft) 2.00 1.50 AVERAGE 1.00 BARRIE 0.50 0.00 y e n h e a e b n g e t l s i p a g e w l l r g t o n i e l r h k H l a i a i d h t i a e n v g g r r r h k B u i W a e d e i u r n m s r a G b k n v a a i O O m c A l o h V w r i u m P t a e a B C N h C c i t R S Municipality Source: BMA Consulting Ltd.
2005 COMMERCIAL 2005 COMMERCIAL TAX COMPARISON TAX COMPARISON 4.50 4.00 3.50 Dollars (per sq ft) 3.00 AVERAGE 2.50 BARRIE 2.00 1.50 1.00 0.50 0.00 y n e h a e e t n b l g e e a w i s l r g p l o t i n g l k h r e H a a i l i t a h i d n e v r g g r h r a B W u e k e d i u n i r s r m G k a b v n a a i O O A o c m l h w V r m i u P t e a a B C N C h c t i S R Municipality Source: BMA Consulting Ltd.
Number of Full-Time Employee Complement /1000 Residents 7 FT Employees/1000 Residents 5.76 6 5.35 5.24 4.45 4.59 4.74 5.00 4.94 4.86 4.91 4.46 5 4.17 3.93 4.04 4 3 2 1 0 1993 1994 1995 1996 1997 1998 1999 2000* 2001 2002 2003 2004 2005 2006 Year * Transfer of 25 positions in water services from PUC
UNDERSTANDING UNDERSTANDING AND ADDRESSING AND ADDRESSING BUDGET PRESSURES BUDGET PRESSURES
2006 BUDGET PRESSURES ON BUDGET PRESSURES ON 2006 PROPERTY TAXES PROPERTY TAXES Unusual Unusual Growth related services “New Deal” Costs Costs Deficiencies Inflation Inflation Growth in Health Services Costs (RVH) Residential Service Partners growth not paying for Assessment itself imbalance – residential vs. ICI Service Level Payroll Costs Increases Capital Budget Council Priorities Support
COMPARISON OF CPI, MUNICIPAL TAX RATE, TARGET TAX POLICY & NON-RESIDENTIAL CONSTRUCTION PRICE INDEX Non-Residential 65 CPI 60 Municipal 55 Tax 50 Cumulative Percentage (%) Rate 45 40 35 Target Tax 30 Policy 25 20 15 Consumer Price 10 Index 5 0 -5 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Years Target Tax Policy is comprised of 85% of CPI and 15% of the non-residential construction index
CUMULATIVE LOST REVENUES DUE TO MUNICIPAL TAX RATE BEING LOWER THAN TARGET TAX POLICY $15.7M $15.8M $15.0M $13.9M 12.8M $12.0M $9.4M $7.8M $6.3M $5.1M $3.3M $1.9M $1.0M 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
OTHER MEASURES OTHER MEASURES � Increased revenues Increased revenues— —investment investment � income and tax additions income and tax additions � Use of reserves for one Use of reserves for one- -time expenses time expenses � � Staff additions reduced from requests Staff additions reduced from requests � for 49 to approval of 30 for 49 to approval of 30 � Further net reductions in expenditures Further net reductions in expenditures � based on review of 2005 actuals based on review of 2005 actuals
MUNICIPAL PORTION OF MUNICIPAL PORTION OF AVERAGE FAMILY’ ’S TAX BILL S TAX BILL AVERAGE FAMILY Municipal 8% Provincial 31% Federal 61% Source: The Fraser Institute’s Canadian Tax Simulator, 2003 – based on an average Ontario family of two or more
2006 GROSS EXPENDITURES VS. 2006 GROSS EXPENDITURES VS. SENIOR LEVEL GOVERNMENT SENIOR LEVEL GOVERNMENT FUNDING (2.3%) FUNDING (2.3%) Provincial re Transit Provincial re Transit $1.1M $1.1M Federal Gas Tax Federal Gas Tax $3.5M $3.5M GST (estimated) GST (estimated) $2.0M $2.0M City’ ’s s City Expenditures Expenditures $287M $287M
NEW DEAL REQUIRED NEW DEAL REQUIRED MUNICIPALITIES CAN NO LONGER MUNICIPALITIES CAN NO LONGER DO IT ON THEIR OWN DO IT ON THEIR OWN Assistance is required from Senior Assistance is required from Senior Levels of Government to: Levels of Government to: • Exclude social services, health, and Exclude social services, health, and • housing costs from property tax base housing costs from property tax base • Provide sustainable funding for Provide sustainable funding for • ongoing costs ongoing costs • Provide funding for the replacement of Provide funding for the replacement of • aging infrastructure aging infrastructure
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