DRAFT 2020-2024 Financial Plan Public Budget Consultation Financial Services Division – February 4, 2020 EDMS#488146 Agenda Financial Plan Process 1 Budget Planning 2 Historical Perspective 3 4 Current Perspective 5 Budget Proposal & Deliberations 6 Q & A 2
Financial Plan Process Financial Plan Process Legislative Process • Provide good government, services, laws Municipal Purpose • Provide stewardship over public assets Community Charter, Section 7 • Foster economic, social and environmental well-being of community Financial Plan • Adopt a 5-Year Budget Community Charter, Section 165 • Tax rates bylaw adopted before May 15 Annual Property Tax Bylaw • Authority to levy taxes on properties to fund Community Charter, Section 197 services Public Consultation • Ensures the public have an opportunity to Process comment Community Charter, Section 166 4
Financial Plan Process – Service Mandate Provide Community Services Essential Services Priority Services Life Sustaining Services Life Quality Services • Recreation • Library • Police • Garbage/Recycling • Parks/Trails • Heritage • Fire • Water • Playgrounds • Environment • Bylaws • Sewer Support Services • Arts • Roads • Drainage • Administration • Clerical • Finance & IT • Communications • HR • Legislative 5 Financial Plan Process – Service Mandate Provide Community Enrichment Community & Environment Culture Support Support • Financial support • Support environmental groups • Accessibility • Development sustainability Business Support • Sports, Arts & Culture Groups checklist • Environmental stewardship • Economic Development Committee • Chamber of Commerce • Business Events (e.g. Spike Awards) 6
Financial Plan Process – Planning Process STRATEGIC BUSINESS FINANCIAL PLAN PLAN PLAN Measurable Attaches Goals & Tasks & resources & Objectives Tactics funding 7 Financial Plan Process Budget Considerations • Residents enjoy and expect exceptional service. Services and level of service • City surveys indicate very high approval rates. • Port Moody taxes relative to other municipalities. • Business to Residential tax ratio – business Revenue Considerations retention issue • Revenue diversification – Digital Billboards Subsidy Levels • User Fees versus property tax to fund services Asset Management • Capital infrastructure funding gap 8
Financial Plan Process – Budget Timeline July- February 4, 2020 April 7, 2020 May 12, 2020 September Board Budget Public Consultation Budget Approval Financial Plan & Presentations 2019 on the Budget Finance Tax Rates Bylaw 2019 Departments Committee Adoption at Regular Library – Oct 22 submit draft Council budgets PMPD – Nov 26 September- April 28, 2020 July 2019 November- February to November 2019 December 2019 Financial Plan & Tax Council April 2020 Finance Staff Introduce Rates Bylaw approves Finance Review First 3 readings at Financial Plan proposed Committee Budgets Regular Council Guidelines Budget to Finance Budget Committee deliberations 9 Budget Planning
Budget Planning – Service Costs Salaries & Wages $37,152,000 (61%) Training & Development $837,000 (1%) Utilities $1,452,000 (2%) Vehicles $1,958,000 (3%) Transfer to Reserves Debt $8,741,000 (14%) $2,042,000 (3%) Contracts & Fees Supplies & Equipment $6,508,000 (11%) $2,736,000 (5%) 11 Budget Planning – Service Costs Value Comparison City Services Planning & Development $148 Engineering & Operations Total City Fiscal Services Services Support Services $389 $488 $604 $616 $1,297 $3,747 Fire Rescue $38 $167 Priority Services Police Utilities Non-City Services Total Non-City Services Home Security System $416 $504 $1,224 $1,613 $2,100 $5,857 Basic Cable Home Insurance Basic Telephone and Internet Gas & Electricity 0 1,000 2,000 3,000 4,000 5,000 6,000 12 Based on 2020 Average Assessed Household of $942,000
Historical Perspective Historical Perspective Tax Increases 1999 to 2019 CPI Tax Increase Average over 20 years Average over 10 years 9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% 14
Historical Perspective Reserves 65,000,000 Total Reserve Balances by Year Average Annual Balance 60,000,000 55,000,000 50,000,000 45,000,000 40,000,000 35,000,000 30,000,000 25,000,000 15 Historical Perspective Budgeted Growth - New Construction 2008-2020 Used to offset 1,200,000 with loss of $1.4M Growth BC Hydro Grant 1% Tax Increase 1,000,000 Growth revenue pays for 800,000 additional services demands 600,000 400,000 200,000 0 * Estimated and subject to change 16
Historical Perspective – Protective Services (excluding Utilities) Fire 22% Fire Fire 20% 17% Other City Other City Departments Other City Departments 55% Departments 55% 47% Police Police Police 31% 28% 25% 2020 2003 2010 17 Historical Perspective Labour Increases 2000-2019 CUPE Fire Police CPI 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% 18
Historical Perspective Long Term Debt - Per Capita 1994-2043 $700 $600 577 555 519 485 $500 453 429 405 381 $400 369 358 342 334315296277257238219199179160140119 99 78 57 36 15 0 314303 303 $300 262 239 213 188 $200 175 156142 93 84 67 58 48 28 22 22 17 13 8 $100 5 $0 19 Current Perspective
Current Perspective – Changing Tax Base (2019) Net Taxable Net Taxable Total Revenue Total Revenue Class Description Tax Class Folio Count Values Values ($) (%) ($) (%) Residential Class 1 12,037 $12,105,048,222 89.39% $28,133,343 63.85% Utility Class 2 33 3,911,940 0.03% 129,956 0.29% Major Industry Class 4 9 145,481,400 1.07% 6,845,395 15.54% Major Industry - Ports Class 4 1 46,040,743 0.34% 1,266,120 2.87% Major Industry – Ports (NI) Class 4 1 32,705,257 0.24% 735,868 1.67% Light Industry Class 5 28 57,493,300 0.42% 709,732 1.61% Business/Other Class 6 439 1,118,352,906 8.26% 6,177,110 14.02% Recreation/Non-Profit Class 8 124 33,074,800 0.24% 61,049 0.14% 12,671 $13,542,108,568 100.00% $44,058,573 100.00% 21 Current Perspective – Changing Tax Base Property Tax Allocation Comparison 1993 - 2019 100.00% 1993 90.00% 2019 80.00% 70.00% 63.9% 60.00% 48.30% 50.00% 40.00% 33.70% 30.00% 20.1% 20.00% 14.60% 14.0% 10.00% 2.00% 1.6% 1.20% 0.3% 0.20% 0.1% 0.00% RESIDENTIAL UTILITY MAJOR INDUSTRY LIGHT INDUSTRY BUSINESS/OTHER RECREATION/NON-PROFIT 22
Future Perspective – Challenges 1 Asset/ Infrastructure Critical community assets are aging and need ongoing funding for Renewal replacement and maintenance 2 1. Competition for talent and skilled labour in the region Work Force 2. Cost of training, development, and retention 1. Limited revenue opportunities under the Community Charter 3 Revenue Constraints 2. Additional property charges from other agencies To be sustainable growth needs to pay for growth and should not Growth and Development impose a financial burden on Port Moody taxpayers 4 Service Levels Balancing wants and needs with the community’s ability to pay 5 23 Budget Proposal & Deliberations
What’s in the Budget Proposal? Budget developed and proposed by City Management Starting point was 2019 service level 2.62% - Operating: Maintains 2019 service levels 1.81% - Operating: Proposed new services 0.46% - Operating: New services previously funded from capital -2.19% - Operating: New revenue (Digital Billboards) 1.00% - Capital: Asset Levy (Infrastructure renewal) 3.70% - Total: 2020 proposed property tax rate increase 25 What’s in the Budget Proposal? 2020 Operating Budget Summary Amount Tax Item Comment ($) (%) 2020 Growth -150,000 -0.35% New Construction Revenue Changes -690,000 -1.59% Development, Permits, Sale of Services Salaries and Wages 1,030,000 2.37% CUPE, IAFF, Management, Benefit Costs Operating Expenses 400,000 0.91% Equipment, Contracted Services, Hydro, Professional Services Reserve Changes 130,000 0.30% Sub Total - City 720,000 1.64% Police 420,000 0.98% Submitted by the Port Moody Police Board Sub Total - Operations 1,140,000 2.62% Budget Guidelines mandates 2.50% 26
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