5 5 Year Financial Pl ar Financial Plan an 2020-2025 2020-2025 - - PDF document

2020-2025 Financial Plan Presentation 2020-05-06 1

5 5 Year Financial Pl ar Financial Plan an 2020-2025 2020-2025

Public Consultation Presentation

Outline

• Legislation – Community Charter Act
• Strategic Plan & Financial Plan
• Funding & Taxation Methods
• Assessment
• Other Taxing Authorities
• Village Services
• Current Situation - COVID-19
• Financial Plan
• Year Over Year Comparisons
• Value of Services
• Questions/Comments

1 2

2020-2025 Financial Plan Presentation 2020-05-06 2

Legislation

The Community Charter Act sets out the requirements for municipal financial planning

• The Financial Plan must cover 5 years
• It must be balanced (some leeway this year due to COVID-19)
• For this year only, municipalities are allowed to carry borrowing for a year – 2021
• For this year only, municipalities are allowed to borrow against their internal reserves without paying interest
• The Financial Plan must set out the revenues and expenses in specific categories
• The Plan must identify the levels of taxation, permissive exemptions and class tax ratios
• If a deficit is incurred in one year, it must be budgeted for and collected in the next year
• There must be an opportunity for the public to view, question and comment prior to adoption
• The Financial Plan must be adopted by bylaw before May 15

Strategic Plan & Financial Plan

• Council developed a Strategic Plan in early 2019 and will update it as necessary - likely this autumn
• r toward the end of the year, basically half way through the 4 year elected term.
• The Financial Plan (or budget) allocates funds for Strategic Priorities; the goals and objectives or

projects in the Strategic Plan are in the budget.

• The budget is made up to two parts – non-discretionary and discretionary.
• In other words, the operating core services that the Village provides on an ongoing basis are non-

discretionary budget expenses; and the strategic initiatives that are not part of current required

• perations are discretionary and tend to be project related.

3 4

2020-2025 Financial Plan Presentation 2020-05-06 3

Funding & Taxation Methods

• There are different methods that municipalities are authorized to use to raise funds.
• Some services are easily tied to actual usage – for example garbage, water, business licenses, pool

attendance, hall rentals, preschool classes. These are logical fee for service situations.

• Some services are subsidized by taxation to augment fee for service – for example the pool is heavily

subsidized as the costs of maintaining it would cause pool fees to be too high for many people to use.

• Other funding models are assessment based (ad valorem) taxes which are progressive taxes, in other

words, sliding scale based on the valuation of the property being taxed. For example, general services such as governmental/administrative/finance/debt servicing, recreation services. These may be based

• n different assessment bases e.g. school taxes are based on the School assessment base; Regional

District requisitions and Regional Hospital District requisitions are based on the Hospital assessment base; and Village services are based on the Municipal assessment base.

Funding & Taxation Methods

• There are also parcel taxes, which in the Village are a set amount for each assessed property parcel.

These are for services deemed as equal value for all properties; for example there are parcel taxes for Works & Services, another for Sewer services and one for Infrastructure Replacement Reserves.

• There is also a Local Service Area tax for exactly that, services only available in a specific, defined area.

The Village does not have any of these taxes at present.

• There are also programs and projects that are fully or partially funded by federal, provincial,
• rganizations, foundations or other grants

5 6

2020-2025 Financial Plan Presentation 2020-05-06 4

Assessment

• Municipalities do not control property valuation. In BC that function is carried out independently

by the BC Assessment Authority (BCAA).

• Properties are valued at July 1 in one year for taxation purposes in the following calendar year.
• Assessment notices are delivered by BCAA in early January and can only be disputed by January 31

in the current calendar year. This must be done through the BCAA and the Village does not have the ability to change an assessment.

• There are 7 property assessment classes, but within the Village there are only Residential, Utilities,

Light Industrial and Business/Other properties.

• Warfield properties have experienced significant increases over the last 2 years (14% for 2020).

However, if your property is within the average increase, your taxes should reflect the average stated tax increase. If the assessment increase is less than the average, the tax increase is less, if more than the average, the tax increase will reflect that.

• In Warfield, the Residential properties are taxed at a lower rate than the other assessment classes.
• The following slide shows the breakdown of the assessment base of the Village.

Assessment continued…

7 8

2020-2025 Financial Plan Presentation 2020-05-06 5

Other Taxing Authorities

• Municipalities in BC are required to collect and remit taxes for other governments and agencies
• The Village does not set the rates, nor have any say in the amounts
• For the Province, the Village levies and collects
• School taxes – both residential and non-residential taxes (different rates)
• Police taxes
• For the regional governments the Village levies and collects the requisitions for
• Regional District of Kootenay Boundary
• West Kootenay Regional Hospital District
• For other authorities, the Village collects the rates for
• BC Assessment Authority (to carry out annual property assessments)
• Municipal Finance Authority (to issue debentures for all municipal borrowing in BC)
• The following slide shows the breakdown of the Village taxes and those collected for
• thers

Other Taxing Authorities continued…

9 10

2020-2025 Financial Plan Presentation 2020-05-06 6

Other Taxing Authorities continued…

• The services provided by the Regional District that the Village participates in are
• The Regional District also provides on a contract basis the following services which the

Village funds from general taxation

• East End Sewer Utility
• Building Inspection
• Mapping Services
• East End Fire Protection
• East End Transit
• Solid Waste Management (landfill/recycling)
• Lower Columbia Culture, Arts & Recreation
• East End Cemeteries
• Administration & General Government
• East End Economic Development
• Emergency Preparedness
• 9 1 1 Emergency Communications
• Police Based Victims Assistance
• Regional Planning & Development
• Feasibility Studies Reserve

Village Services

• The services that the Village sets the levels and budget for are
• Roads and Streets (snow clearing, maintenance, patching)
• Street lights, signs and sidewalks
• Sewer (liquid waste) collection
• Water treatment and distribution
• Garbage and yard waste collection
• Bylaw enforcement
• Land use planning and development
• Special events and programs (Age Friendly partially grant funded, Youth Action Network grant funded, volunteer recognition,

community events)

• Recreation services (pool, community hall, parks and walkways)
• Building and plumbing inspections
• Hydrant maintenance and replacement
• Fiscal services (debt retirement, equipment replacement)
• Governance services (Council, elections, legislative requirements)
• General corporate services (administration, finance, labour relations etc.)

11 12

2020-2025 Financial Plan Presentation 2020-05-06 7

Village Services continued…

• There are also special projects and reserves that Council has deemed as strategic

initiatives

• Asset Management planning for future replacement (water, sewer, roads, drainage, equipment, facilities)
• Infrastructure Replacement Reserve building (to fund future replacements and improvements)
• Feasibility studies and plans (drainage study, water treatment preliminary and long range planning)
• Water Improvement Reserve (to fund future water treatment system replacement by 2026)
• Zoning Bylaw update (current one is 36 years old, adopted in 1984)
• Capital works
• In 2020 pool filters replacement - $50,000
• Rail crossing replacement - $75,000
• Water system – pressure reducing valve replacement - $45,000
• Water treatment plant – flow meters (2) installation - $50,000
• Engineering work for Burns Avenue water/sewer realignment - $22,000

Current Situation – COVID-19

• The Village Council directed a financial plan in February and March and the original tax levy increase was determined to

be 4% in order to maintain the current level of services and plan for required reserves.

• In March and April, as the pandemic situation evolved, it became clear that some service levels would not be feasible.
• In particular, the Centennial Pool operations are not financially supportable at the attendance level and operational

requirements for the limited attendance expected to be allowed by the Provincial Health Officer.

• Also, the Warfield Community Hall is impacted by the pandemic physical distancing and attendance limits and is not

expected to be in operation for several months of 2020.

• Parks and playgrounds are curtailed, and summer students are not required for summer service.
• All of these limitations, as well as Council’s recognition of the financial burdens on residents, resulted in a re-thinking

and re-working of the Financial Plan. The new level of taxation to remain sustainable has been halved, to 2%.

• Commercial/Business properties have been provided with additional supports from the Province of BC. They have

received a 75% reduction in their property tax rates and the ability to defer payment without penalty to September 30 instead of July 2.

• The impact on residential properties (97.6% of taxes) is shown on the next 3 slides for various

levels of assessments (low, medium and higher property values).

13 14

2020-2025 Financial Plan Presentation 2020-05-06 8

Financial Plan - General Fund

SCHEDULE “A” to Village of Warfield 5 Year Financial Plan 2020-2024 Bylaw 890 REVENUE 2020 2021 2022 2023 2024 General Fund Taxes 777,435 798,844 822,518 854,748 888,310 Parcel Taxes 125,000 125,000 125,000 125,000 125,000 Sale of Services 146,930 247,703 251,586 255,884 260,354 Other Revenues from Own Sources 185,342 180,142 175,142 175,142 175,142 Grants 524,034 501,744 490,800 490,900 491,000 Prior Year Surplus Utilized 7,682

• Transfer from Reserves

125,000

• Collections for Other Governments & Agencies

1,036,932 1,045,560 1,045,560 1,045,560 1,045,560 Total General Fund Revenue $2,928,355 $2,898,993 $2,910,605 $2,947,234 $2,985,367 EXPENDITURES General Fund General Government Services 526,017 511,355 514,942 519,435 521,962 Protective Services 116,500 121,700 120,700 121,700 121,700 Public Works Administration & Facilities 150,750 153,080 155,564 158,295 160,875 Transportation Services 236,490 236,985 241,715 234,547 236,794 Street Lighting & Signage 32,950 44,200 44,250 44,200 44,200 Equipment 91,090 91,090 91,090 91,090 91,090 Environmental Health Services 161,125 157,575 159,995 162,135 164,296 Environmental Development 72,000 22,000 22,000 22,000 22,000 Recreation & Social Programs 199,250 306,550 315,550 315,550 315,550 Recreation Facilities 95,800 131,800 133,240 134,691 136,253 Fiscal Services 82,712 77,098 66,000 66,000 66,000 Transfer to Reserves & Utility Funds 1,739

• 32,031

59,087 Collections for Other Governments & Agencies 1,036,932 1,045,560 1,045,560 1,045,560 1,045,560 General Fund Capital Expenditures 125,000

• Total General Fund Expenditures

$2,928,355 $2,898,993 $2,910,605 $2,947,234 $2,985,367

Financial Plan – Water Fund

2020 2021 2022 2023 2024 Water Fund Parcel Taxes 78,100 78,100 78,100 78,100 78,100 Sale of Services 372,209 387,620 398,457 414,835 431,980 Grants 17,500 876,000

• Transfer from General Prior Year Surplus

9,421

• Transfer from Reserves

95,000 301,067 45,000 45,000 45,000 Total Water Fund Revenue $572,230 $1,642,787 $521,557 $537,935 $555,080 Administration 67,222 10,000 10,000 10,000 10,000 Training & Development 6,725 9,225 9,225 9,225 9,225 Distribution 47,300 46,800 46,800 46,800 46,800 Testing & Reporting 10,400 10,400 10,400 10,400 10,400 Water Treatment Plant 183,300 190,500 190,500 190,500 190,500 Fiscal Services 162,283 130,862 130,862 130,862 130,862 Transfer to Reserves

• 78,770

95,148 112,293 Capital 95,000 1,245,000 45,000 45,000 45,000 Total Water Fund Expenditures $572,230 $1,642,787 $521,557 $537,935 $555,080

15 16

2020-2025 Financial Plan Presentation 2020-05-06 9

Financial Plan – Sewer Fund

Sewer Fund 2020 2021 2022 2023 2024 Sewer Rate Sales 31,178 31,683 32,316 32,963 33,622 Sewer Connection Charges 5,000 5,000

• UBCM gas tax
• Prior Year Surplus
• Sewer Parcel Tax

346,240 346,240 346,240 346,240 346,240 Total Sewer Fund Revenue 382,418 $ 382,923 $ 378,556 $ 379,203 $ 379,862 $ Operations & training 16,625 14,625 11,125 11,125 11,125 Collections 66,500 56,500 56,500 56,500 56,500 Lift Station 10,500 10,500 10,500 10,500 10,500 Contracts 200,000 200,000 200,000 200,000 200,000 Transfer to Reserves 66,793 101,298 100,431 101,078 101,737 Capital 22,000

• Total Sewer Fund Expenditures

$382,418 $382,923 $378,556 $379,203 $379,862

Financial Plan - Aggregate Summary

TOTAL OPERATING REVENUE 3,663,003 3,747,636 3,765,718 3,819,372 3,875,309 TOTAL OPERATING EXPENSE 3,641,003 3,679,703 3,765,718 3,819,372 3,875,309 TOTAL OPERATING SURPLUS/(DEFICIT ) $22,000 $67,933 $0 $0 $0 CAPITAL REVENUE 220,000 1,177,067 45,000 45,000 45,000 CAPITAL EXPENSE 242,000 1,245,000 45,000 45,000 45,000 CAPITAL SURPLUS/(DEFICIT)

• $22,000
• $67,933

$0 $0 $0 TOTAL REVENUE 3,883,003 4,924,703 3,810,718 3,864,372 3,920,309 TOTAL EXPENSES 3,883,003 4,924,703 3,810,718 3,864,372 3,920,309 TOTAL SURPLUS/(DEFICIT) $0 $0 $0 $0 $0

2020 2021 2022 2023 2024

17 18

2020-2025 Financial Plan Presentation 2020-05-06 10

Financial Plan continued…

• This is where the funds

are sourced. .

Financial Plan continued…

• And this is where the funds are utilized.

19 20

2020-2025 Financial Plan Presentation 2020-05-06 11

Year Over Year $150,000 Home

Sample Tax Comparisons

Residential Assmt Rate Tax Levy Assmt Change Rate Tax Levy $ Increase %Increase Assmt Change Rate Tax Levy $ Increase %Increase 125,000 135,000 8.0% 150,000 11.11% General Municipal 4.29560 536.95 4.069 549.32 12.36 2.3% 3.58730 538.10 11.22

• 2.0%

Works & Service Parcel Tax 160 160.00 160 160.00

• 0.0%

160 160.00

• 0.0%

Water Parcel Tax 100 100.00 100 100.00

• 0.0%

100 100.00

• 0.0%

Sewer Parcel Tax 438 438.00 464 464.00 26.00 5.9% 464 464.00

• 0.0%

Infrastructure Parcel Tax

• 100

100.00 100.00 100.0% 100 100.00

• 0.0%

Municipal Tax Levies 1,234.95 1,373.32 138.37 11.2% 1,362.10 11.22

• 0.8%

School Tax 2.49220 311.53 2.35100 317.39 5.86 1.9% 2.33640 350.46 33.08 10.4% Policing Levy 0.38800 48.50 0.36240 48.92 0.42 0.9% 0.35240 52.86 3.94 8.0% Regional District 1.87780 234.73 1.8140 244.89 10.17 4.3% 1.68516 252.77 7.88 3.2% Regional Hospital District 0.27660 34.58 0.27640 37.31 2.74 7.9% 0.23250 34.88 2.44

• 6.5%

BC Assessment Authority 0.04030 5.04 0.03890 5.25 0.21 4.2% 0.04260 6.39 1.14 21.7% Municipal Finance Authority 0.00020 0.03 0.00020 0.03 0.00 8.0% 0.00020 0.03 0.00 11.1% External Tax Levies 634.39 653.79 19.40 3.1% 697.39 43.60 6.7% TOTAL TAXES 1,869.34 2,027.11 157.77 8.4% 2,059.48 32.38 1.6%

2018 2019 2020

Year Over Year $250,000 Home

Sample Tax Comparisons

Residential Assmt Rate Tax Levy Assmt Change Rate Tax Levy $ Increase %Increase Assmt Change Rate Tax Levy $ Increase %Increase 200,000 220,000 10.0% 250,000 13.64% General Municipal 4.29560 859.12 4.069 895.18 36.06 4.2% 3.58730 896.83 1.64 0.2% Works & Service Parcel Tax 160 160.00 160 160.00

• 0.0%

160 160.00

• 0.0%

Water Parcel Tax 100 100.00 100 100.00

• 0.0%

100 100.00

• 0.0%

Sewer Parcel Tax 438 438.00 464 464.00 26.00 5.9% 464 464.00

• 0.0%

Infrastructure Parcel Tax

• 100

100.00 100.00 100.0% 100 100.00

• 0.0%

Municipal Tax Levies 1,557.12 1,719.18 162.06 10.4% 1,720.83 1.64 0.1% School Tax 2.49220 498.44 2.35100 517.22 18.78 3.8% 2.33640 584.10 66.88 12.9% Policing Levy 0.38800 77.60 0.36240 79.73 2.13 2.7% 0.35240 88.10 8.37 10.5% Regional District 1.87780 375.56 1.8140 399.08 23.52 6.3% 1.68516 421.29 22.21 5.6% Regional Hospital District 0.27660 55.32 0.27640 60.81 5.49 9.9% 0.24801 62.00 1.19 2.0% BC Assessment Authority 0.04030 8.06 0.03890 8.56 0.50 6.2% 0.04260 10.65 2.09 24.4% Municipal Finance Authority 0.00020 0.04 0.00020 0.04 0.00 10.0% 0.00020 0.05 0.01 13.6% External Tax Levies 1,015.02 1,065.44 50.42 5.0% 1,166.19 100.75 9.5% TOTAL TAXES 2,572.14 2,784.62 212.48 8.3% 2,887.02 102.40 3.7%

2018 2019 2020

21 22

2020-2025 Financial Plan Presentation 2020-05-06 12

Year Over Year $350,000 Home

Sample Tax Comparisons

Residential Assmt Rate Tax Levy Assmt Change Rate Tax Levy $ Increase %Increase Assmt Change Rate Tax Levy $ Increase %Increase 265,000 300,000 13.2% 350,000 16.67% General Municipal 4.29560 1,138.33 4.069 1,220.70 82.37 7.2% 3.58730 1,255.56 34.86 2.9% Works & Service Parcel Tax 160 160.00 160 160.00

• 0.0%

160 160.00

• 0.0%

Water Parcel Tax 100 100.00 100 100.00

• 0.0%

100 100.00

• 0.0%

Sewer Parcel Tax 438 438.00 464 464.00 26.00 5.9% 464 464.00

• 0.0%

Infrastructure Parcel Tax

• 100

100.00 100.00 100.0% 100 100.00

• 0.0%

Municipal Tax Levies 1,836.33 2,044.70 208.37 11.3% 2,079.56 34.86 1.7% School Tax 2.49220 660.43 2.35100 705.30 44.87 6.8% 2.33640 817.74 112.44 15.9% Policing Levy 0.38800 102.82 0.36240 108.72 5.90 5.7% 0.35240 123.34 14.62 13.4% Regional District 1.87780 497.62 1.8140 544.20 46.58 9.4% 1.68516 589.81 45.61 8.4% Regional Hospital District 0.27660 73.30 0.27640 82.92 9.62 13.1% 0.24801 86.80 3.88 4.7% BC Assessment Authority 0.04030 10.68 0.03890 11.67 0.99 9.3% 0.04260 14.91 3.24 27.8% Municipal Finance Authority 0.00020 0.05 0.00020 0.06 0.01 13.2% 0.00020 0.07 0.01 16.7% External Tax Levies 1,344.90 1,452.87 107.97 8.0% 1,632.67 179.80 12.4% TOTAL TAXES 3,181.24 3,497.57 316.33 9.9% 3,712.22 214.65 6.1%

2018 2019 2020

Value of Services for an average home $270,608

Cost of ALL your water for a day $443 yr $1.21 Cost of a bottle of water 500ml $1.29 Cost of your sewer for a day $473.30 yr $1.30 Rental of a porta-potty $95mo $3.06 Cost of your Fire Service per year $211.14 Cost of insurance $1070 Cost of your garbage collection per week $2.75 Cost of a landfill visit $4 per bag Cost of school per day $1.73 Cost of a Big Mac $5.69 Cost of policing per day $0.26 Cost of a latte $4.75 Per day cost of all services: water, sewer, roads, snow clearing, street lights, garbage, planning, schools, police, fire service, recreation, parks, library, hall, building inspection, bylaw enforcement, etc. On an average house PER YEAR PER MONTH PER DAY

• Reg. HOG

$2282.88 $190.24 $6.25 Sen HOG $2007.88 $167.32 $5.50

23 24

2020-2025 Financial Plan Presentation 2020-05-06 13

Questions / Comments

The Village of Warfield

Thanks you!

25 26