Town of Sidney Financial Plan 2017 – 2021 February 21, 2017
Budget Process Timing January 16 th – Committee of the Whole – Budget Introduction Presentation of summary budget information. Clearly outline the starting point for deliberations. Budget package distributed to Council, and available to public. February 6 th – Committee of the Whole Opportunity to discuss and clarify various parts of the budget. Opportunity for in-depth discussion prior to final deliberations. Opportunity for public input. Additional staff reports on meeting agenda. February 21 st – Special Council Meeting – Budget Deliberations Updated presentation for benefit of Council and the public. Direction from the previous meetings incorporated. Goal is for Council to approve the Financial Plan.
Review Process Following opening summary: Council to approve changes to budget by resolution Subject to tonight’s review, the following resolutions are anticipated: Any additions, deletions, changes or deferrals to budget Approval of the general capital budget, as amended Approval of the general operating budget, as amended.
What has been Approved? Water & Sewer Budgets Largely status quo; no change to rates. SHOAL Centre Sign?
What has Changed since Introduction? Tax funding for Capital projects reduced by $77,100 Replaced by funds carried over from 2016 Reduction in project and reallocation of funding Use of Amenity Funds. Museum Supplemental request decreased by $20,200. Employee Parking Lot now Gas Tax funded Tax revenue from new construction reduced by $9,000. Total reductions since introduction: $90,750.
So What’s the Tax Increase? The Draft Financial Plan started out with a 1.51% general tax increase for 2017. At introduction, we outlined the major budgetary impacts (how we got to the 1.51%). We have since identified additional net savings that reduce the tax increase to 0.66%. Tonight… Council will have one more chance to make additional changes to the budget.
Budget Highlights Supplemental Items – one-time or ongoing additions to existing service levels Net impact for 2017: $137,250. Additional $124,000 going into reserves Including $60K Supplemental item above. More support for community organizations and partners. Beginning construction of Community Safety Building Tax impacts are mostly in 2018/2019. Making the most of all our funding sources to keep tax increases to a minimum.
Capital Budget Total Capital for 2017: $11.6M $3.3M in Replacement Plan projects Infrastructure Plans - $2.2M Other replacement plans - $1.1M $328K in Recurring Programs e.g. Street Lighting, Underground Wiring, Small equipment $6.8M in projects carried forward from 2016 $6M of this is Community Safety Building $472K for Skateboard Park $1.17M in new projects – see document for full listing Employee Parking Lot – initial phase Only $168K of this is tax funded.
Capital Budget Capital Funding Sources $11.6M Capital program funded as follows: Reserves - $5M Debt - $6M Taxes and User Fees - $237K Funds carried forward from previous years - $344K Other - $69K.
Tax Funded Expenditures 3.7% 1.8% 5.1% 2.5% 10.7% Police Protection Public Works General Government 19.9% Fire & Emergency Services 10.8% Recreation and Culture Transfer to Reserves Community Support Planning, Building & Bylaw 11.7% Capital Debt Servicing 18.7% 15.0%
Property Taxes Increase in Property Taxes required: $212,295 Allocated as follows: $141,000 in taxes from new construction Assuming current tax increase (0.66%) An increase of $16,000 over last year. $71,295 in general tax increase Roughly 0.66%.
Property Tax Impacts Town of Sidney - 2017 Financial Plan Required % Tax Tax Revenue Increase 2016 Taxes 10,764,343 Add: Changes to core budget Miscellaneous operational increases 89,700 RCMP Contract increases 45,800 Increase in reserve transfers 51,200 Decrease to capital budget funded from tax (111,655) 75,045 0.70% Add: Incremental items Supplementals - one time 52,000 Supplementals - continuous 129,850 Less: 2016 one-time Supplementals (44,600) 137,250 1.28% Deduct: Offsets 2017 Tax Base growth (non-market) revenue (141,000) (141,000) -1.31% 2017 Property tax increase to existing taxpayers 71,295 0.66% Note: 1% increase in taxes = $107,637 in additional revenue. Each 1% tax increase represents approximately $1.15 per month for the average residential taxpayer
Impact on Tax Bill Example: financial impact of 0.66% property tax increase for “average” home assessed at $514,364 (2016: $441,331). 2016 2017 Annual Monthly Daily Annual Monthly Daily Municipal Taxes 1,378 115 3.78 Municipal Taxes 1,387 116 3.80 Water Parcel Tax 60 5.00 0.16 Water Parcel Tax 60 5.00 0.16 Sewer Parcel Tax 120 10.00 0.33 Sewer Parcel Tax 120 10.00 0.33 Total 1,558 130 4.27 Total 1,567 131 4.29 Increase 9.09 0.76 0.02 Actual % increase on municipal charges 0.58%
Property Taxes – Average Residence 2017 2016 Increase Increase ASSESSED VALUE 514,364 441,167 $73,197 16.59% MUNICIPAL TAXES $1,387.09 $1,378.00 $ 9.09 0.66% OTHER GOVERNMENTS School Taxes 714.43 714.43 - 0.00% Regional District 300.93 291.09 9.84 3.38% Regional Hospital 130.21 128.46 1.75 1.36% B.C. Assessment 23.96 23.96 - 0.00% Municipal Finance Authority 0.09 0.09 - 0.00% Regional Transit Levy 110.29 110.29 - 0.00% Regional Library 90.02 86.74 3.28 3.78% Total Other Governments 1,369.93 1,355.06 14.86 1.10% TOTAL $2,757.02 $2,733.06 $23.96 0.88%
Who Gets Your Tax Dollars? Residential Commercial Other Taxes 22% Municipal 53% School 25%
5-Year Projection 2017 2018 2019 2020 2021 New Revenue Required $ 212,295 $ 471,388 $ 428,275 $ 219,220 $ 296,197 Tax Base Growth (141,000) (150,000) (150,000) (150,000) (150,000) General Tax Increase $ 71,295 $ 321,388 $ 278,275 $ 69,220 $ 146,197 % increase 0.66% 2.93% 2.43% 0.58% 1.21% • Largest impact for 2018/2019: CSB Debt repayments. • Revenue projections are conservative • Tax Base growth may in fact offset some of the above increases.
CSB Borrowing 2017 2018 2019 2020 2021 $14,650 $ 160,725 $ 307,490 $ 317,012 $ 317,012 • Based on total of $6.3M borrowed over 3 years • First amount locked in Fall 2017 • Final amount in Spring 2019 • Final borrowing amount still very much dependent on proceeds from sale of existing fire hall site.
Inflation vs Tax Increases The following table compares (one measure of) inflation over the last 5 years to the annual tax increases: 2013 2014 2015 2016 2017 Cumul. Victoria CPI* 1.0% -0.3% 0.9% 1.1% 1.77% 4.5% Tax Increase 2.93% 2.61% 2.52% 0.81% 0.66% 9.9% The inflation factor used in the above table is not the most relevant to capture the Town’s expenditure types. Price of oil and construction materials, for example, has greater impact on Town budget than on typical basket of goods that makes up CPI. More importantly, CPI does not allow for additions to the “basket” i.e. New services.
Inflation vs Tax Increases In comparing CPI to tax increases, must also consider: Changes in service level from one year to the next e.g.. Firefighter Hiring Plan, additional Policing. Non-discretionary increases over which the Town has no control e.g. Large increases to RCMP contract. Increases deferred from (or accumulating in) previous years e.g. Setting aside more funds to deal with Infrastructure Deficit Incurring debt to pay for building replacements or parks expansion Hiring Parks staff to assist with increased maintenance volumes due to addition of park spaces.
Policing Costs – 2009 to 2017 Year Per Member 70% Total Cost Members 2009 120,600 84,420 1,181,880 14 2010 129,100 90,370 1,265,180 14 2011 135,400 94,780 1,326,920 14 2012 140,000 98,000 1,372,000 14 2013 150,670 105,469 1,476,566 14 2014 156,000 109,200 1,583,400 14.5 2015 159,130 111,391 1,670,865 15 2016 167,300 117,100 1,756,200 15 2017 173,100 121,200 1,800,000 15
Community Support Funding Amounts budgeted for community support have increased over the past several years: 2013 2014 2015 2016 2017 MWC 191,132 197,852 255,527 291,338 316,109 Museum 103,300 100,941 99,175 110,567 113,367 SODC 51,336 55,751 78,736 78,669 78,669 Econ. Dev. 120,000 123,962 160,000 128,800 138,800 Other 70,900 91,503 79,400 77,945 75,845 Total 536,668 570,009 672,838 687,319 722,790
Community Support Funding At over $720K in 2017, 6.6% of Net Operating Budget 800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 - 2013 2014 2015 2016 2017 MWC Museum SODC Econ. Dev. Other
Increases above Inflation – past 5 years Total Difference: approx. $580,000 RCMP Contract: $428,000 Community Support: $200,000 Firefighter Hiring Plan: $200,000+ Transfer to Infrastructure Reserves: $220,000 Already accounted for; how funded? Growth in tax base Internal efficiencies!
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