IMC 2013 2013 MCDP Inter-Municipal Conference SHARING AGREEMENTS - - PDF document

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SHARING AGREEMENTS

2013 MCDP Inter-Municipal Conference

INTRODUCTIONS

Table group introductions

• Name
• Where you are from
• What you do

AGENDA

 Advantages & Disadvantages of Sharing  Elements of Sharing Agreements

• why, who, what, when, how

 How to Share a Resource or Service

• revenue sharing
• tax sharing
• cost sharing

 Models of Sharing

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ADVANTAGES AND DISADVANTAGES

 Share investment and

risks

 Foster future

collaboration

 Reduce free-riders  Allows for greater

• pportunities for

municipalities that lack resources

 More efficient use of

resources

 Blurred lines of

accountability

 Considerable

investment of administrative and other resources to start

 Risk taking

ACTIVITY:

What are the important steps that a group of municipalities should take to share a bylaw enforcement officer?

Make a list within your table group (don’t get too detailed)

Context: Your table group is a successful inter-municipal group that has already worked together. The group’s next priority is to share a BEO. Make a list of what the process should look like so the end result is the hiring of a BEO for the group.

SHARING AGREEMENTS

Inter-municipal agreements are a written understanding between two or more municipalities. Usually, these agreements set out specific arrangements that state how the involved municipalities will share a particular service or resource

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ELEMENTS OF SHARING AGREEMENTS

• Why
• Who
• What
• When
• How

ELEMENTS OF SHARING AGREEMENTS:

Why:

• Outline the issue/service/resource/project

that will be shared

Who:

• List those involved in the agreement
• Staff resources – who are the funds provided

to and managed by? ELEMENTS OF SHARING AGREEMENTS:

What:

• Definition of the product or services

When:

• Timeline of the agreement
• Timeline on when the funds need to be

submitted

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ELEMENTS OF SHARING AGREEMENTS:

How:

• Roles and responsibilities
• Decision making process
• Review, continuation, termination
• Budgeting – sharing model/formula
• Make sure to provide an Appendix in the

Agreement with a detailed outline of the model to ensure all parties involved agree with the terms HOW TO SHARE A RESOURCE OR SERVICE

 Revenue sharing  Tax sharing  Cost sharing

REVENUE SHARING:

Municipalities can create agreements to share all or part of the profits derived from a public institution such as a museum.

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SASKATCHEWAN REVENUE SHARING EXAMPLE:

The Town of Kindersley recognized that many users from throughout the region used their airport, not just residents of the town. Eventually, the Town of Kindersley and five surrounding rural municipalities joined together in a regional governance partnership to oversee management and maintenance of the Kindersley Airport. These six municipalities adopted a democratic process of one member-one vote on the Kindersley Regional Airport Board. They share equally in the operational costs, working to create a capital reserve for upgrades and improvements.

TAX SHARING

There are three key design features in any tax-sharing arrangement:

 which tax or taxes are shared  the percentage of the revenues from those

taxes that is assigned to the regional pool

 the formula for redistributing funds from the

regional pool to the participating municipalities

MANITOBA TAX SHARING EXAMPLE:

In October 2000, five municipalities in an area known as the Pelly Trail region signed an agreement to share growth in commercial property tax revenue within the region, along the Manitoba-Saskatchewan border . The councils agreed to share incremental commercial property tax growth (created either by attracting development or encouraging expansion of existing development). Of this new revenue, 70% is contributed to a tax sharing pool and 30% is retained by the host municipality to cover ongoing costs of servicing the new development. By retaining 30%, the municipality will not be ’out of pocket’ because of the new development.

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COST SHARING

“Cost sharing is when two or more municipalities jointly contribute capital and/or operating dollars to have common access to some benefit/service”

(Source – aamdc http://www.aamdc.com/advocacy/reports)

DISCUSSION:

In your table groups: Make a list of some things your region can cost share? Can anyone speak about experiences they have had with revenue, tax, or cost sharing? Give a good example – why was it a success? Give a bad example – why didn’t it work out?

MODELS OF SHARING:

Per Use Basis Tax Assessment Equal Shares Per Capita Mixed approach

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MODELS OF SHARING: Per Use Basis: Charge on a per use basis. Best used for services that allow for billing based on each municipalities use of the service. For example: one municipality bills or charges another for their use of a regional

• service. Some services are better suited

for this method such as waste water treatment or water distribution. MODELS OF SHARING:

Tax Assessment: Based on a municipality’s capacity to generate revenues measured by the standardized property value or the potential to generate revenues from their tax base

MODELS OF SHARING:

Equal Shares:

Municipality A – pays 25% Municipality B – pays 25% Municipality C – pays 25% Municipality D – pays 25%

25% 25% 25% 25% Municipality A Municipality B Municipality C Municipality D

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MODELS OF SHARING:

Per Capita:

This example shows 5 municipalities funding a project that costs $50,000

MODELS OF SHARING:

Mixed:

50% of the total cost was split into even shares and the remaining 50% will be paid on a per capita basis

ACTIVITY:

Read the hand-out scenario. There are 4 roles to play. If there are extra members at the table – they can share a role or play the role of facilitator. Create a cost sharing model that all participants can agree with.

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CONCLUSION

Sharing agreements can take many forms depending

• n specific projects and situations. Inter-municipal

groups can use one specific method or a combination

• f methods.

Sharing between municipalities can provide very important benefits to communities by expanding the scope and quality of services available to the public and promote economic growth within a region. The most critical element of a successful agreement is the attitude of individuals involved – pro-actively embrace a cooperative culture!