PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN Budget Information - - PowerPoint PPT Presentation

Budget Information Meetings

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

January 28-30, 2020

Presentation Outline

2

1. Assessment Changes 2. Asset Management 3. Greening the Budget 4. Operational Issues 5. Capital/Asset Issues 6. 2020 Budget Process

Presentation Outline

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 1

Assessment Changes

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 2

Assessment Shifts in West Vancouver

Assessment Change = -20%

Average

Assessment Change = -14.8% Assessment Change = -10%

Above Average

This chart references the arithmetic mean average of all residential property classes, as this is the point of 0% tax shift.

Change in Assessment 2019 Assessment 2020 Assessment Tax Shift Municipal Tax

Below Average

• 20%

$3,110,913 $2,488,730

• $275

$4,187 Average

• 14.8%

$2,919,350 $2,488,730 $0 $4,187 Above Average

• 10%

$2,765,256 $2,488,730 $221 $4,187 PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 3

2019 Heat Map

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 4

2020 Heat Map

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 5

Tax Shift vs. Property Value

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 6

Property Tax Deferment

• The Province is changing the way the application for

property tax deferments will be handled

• Starting in April 2020, there will be an electronic application

required for both new and renewal applications

• You will no longer be able to apply through the municipality
• The Province will send a letter with instructions for renewal

to all property owners already deferring property tax

• More information will be available on the District’s website,

in the tax bill mail out, and at: www.gov.bc.ca/propertytaxdeferment

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 7

Asset Management

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 8

Asset Management

• The District currently owns $1 billion in assets
• This is approximately $60,665 for each household, based on

16,484 households

• Over the next 20 years, virtually all of these assets will

require capital investment to maintain their performance

• The estimated cost of maintaining the general fund assets

alone is $304.8 million over the next 20 years

• The District needs to continue working on the long-term

strategy for asset management

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 9

Twenty-Year Asset Lifecycle Replacement and Maintenance

$0 $5 $10 $15 $20 $25 $30 $35 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039

Millions

Information Technology Transportation Infrastructure & Equipment Parks, Culture & Community Fire & Rescue Police Library Facilities Current Asset Management Tax Funding

Twenty-Year Lifecycle Funding Requirement $ 14.5M Deferred Maintenance Requirement $ 13.8M

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 10

Twenty-Year Asset Lifecycle Replacement and Maintenance

$0 $5 $10 $15 $20 $25 $30 $35 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039

Millions

Information Technology Transportation Infrastructure & Equipment Parks, Culture & Community Fire & Rescue Police Library Facilities Current Asset Management Tax Funding

Twenty-Year Lifecycle Funding Requirement $ 14.5M Deferred Maintenance Requirement $ 13.8M

DEFERRED MAINTENANCE

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 11

Asset investment gap recalculated due to: » compounding impact of not funding required maintenance in past years (deferred maintenance) » response to climate change impacts

Asset Levy – Moving Target

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 12

• 1. Eliminate deferred maintenance deficit.
• 2. Incorporate natural capital maintenance and

climate action emergency response support projects.

Asset Management – Next Steps

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 13

Greening the Budget

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 14

Proposed Additional Asset Levy

Average Value Property

Asset Levy for: Amount per average household Levy %

Natural Capital and Climate Response $41 1.00% Deferred Maintenance (Repay Endowment Fund Loan) $20 0.50%

2020 average assessed single family detached home in West Vancouver is $2.85 million. PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 15

Greening the Budget: Climate Emergency Response

• A 1% addition to the Asset Levy will add $738,000 to the

District’s asset reserves annually

• The District is working to make all of our assets ‘green’, but

this generally involves spending more money up front

• The Community and Corporate Emissions Plans include

more than fifty actions we need to implement to reduce greenhouse gases, limit waste, and monitor conditions

• The District also now has an inventory of natural capital

assets, and these also need investment and monitoring

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 16

Deferred Maintenance

• The District has underinvested in its assets for many years,

resulting in outdated assets in poor condition

• Gradually, these assets are being replaced, but there is still

about $13M worth of asset investment outstanding

• A 0.5% addition to the asset levy will allow the District to do

internal borrowing from its basic Endowment Fund of $18M

• This will fund $5.5M, which is enough to deal with the most

urgent deferred maintenance issues, including outdated technology, docks, roads, and washrooms

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 17

Operational Issues

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 18

Factors affecting the operating budget:

Revenue reductions

• Permit revenue
• Investment income

Unavoidable cost pressures

• Contract increases
• Utility rate increases

2020 Operating Budget

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 19

For 2020, 1% equals $738,000 of revenue to the District. The impact of a 1% property tax rate increase on three typical properties:

1% Property Tax Rate Increase

Assessed Value of Property Proposed Tax Impact $1.00 million $14 $2.85 million* $41 $5.00 million $72

*2020 average assessed single family detached home in West Vancouver is $2.85 million. PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 20

2020 Preliminary Operating Budget

Increase / (Decrease) Tax Increase % Labour changes $2,388,918 3.24% Requests Labour – 8 FTEs $908,737 1.23% Non-Labour $267,026 0.36% Revenue reductions $677,876 0.92% Unavoidable cost increases $359,430 0.49% Additional revenue ($848,590) (1.15%) Cost reductions ($111,317) (0.15%) New construction revenue ($706,000) (0.96%) Total $2,936,080 3.98%

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 21

2020 Preliminary Operating Budget

Operational Requests Total of Items Requested $1,960,718 Critical Items Included $1,175,763 Items Not Included $784,955

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 22

Capital/Asset Issues

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 23

2020 Preliminary Capital Budget

Requirement for: Total Requests Critical Requests Deferred Maintenance $13,727,712 $11,475,082 Maintenance $12,761,727 $9,828,557 New Assets $1,248,000 $566,000 New Assets – CEEP Support $1,186,915 $598,915 Total $28,924,354 $22,468,554

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 24

2020 Preliminary Capital Budget

Available Funding: 2020 Base Asset Levy Funds $14,500,000 2020 DCCs and External Funds $1,171,500 Proposed 2020 Natural Capital and CEEP Support $738,000 Proposed 2020 Deferred Maintenance Loan $5,500,000 Funding Available for Required Maintenance $21,909,500 Shortfall $559,054

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 25

2020 Budget Process

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 26

Preliminary Proposed Increase

Average Single Family Detached Home

Average Single Family Detached Home = $2.85M 2019 Taxes & Fees Proposed 2020 Taxes & Fees Y:Y Change Proposed Increase/ (Decrease) Operational Levy $4,093 $4,256 $163 3.98% Incremental Asset Levy

included above

$20 $20 0.50%

*

Natural Capital & Climate Response $0 $41 $41 1.00% Total $4,093 $4,317 $224 5.48%

* Percentage of 2019 total tax

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 27

Utilities Increase

Median Household

Median Household 2019 Taxes & Fees Proposed 2020 Taxes & Fees Y:Y Change Proposed Increase/ (Decrease) Water $695 $728 $33 4.75% Sanitary/Storm Sewers $1,083 $1,180 $97 8.96% Solid Waste $241 $232 ($9) (3.73%) Total $2,019 $2,140 $121 5.99% PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 28

Online westvancouverITE information and moderated forum Budget Information Meetings January 28 | 3–5 p.m. | Seniors’ Activity Centre January 29 | 6–8 p.m. | West Vancouver Memorial Library January 30 | 6:30–8:30 p.m. | West Vancouver Community Centre

Consultation

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 29

2020 Budget Timeline

Oct 2019 Requests for operating and capital submitted Nov 2019 Divisional review of operating and capital budgets Dec 9, 2019 Budget presentation to Finance Committee Dec 16, 2019 Budget presentation to Council Jan 16-Feb 2, 2020 westvancouverITE online forum Jan 28-30, 2020 2020 Budget Information Meetings Feb 24, 2020 Proposed 2020 Operating and Capital Budgets Mar 30, 2020 Proposed 2020-2024 Five-Year Financial Plan Bylaw Apr 6, 2020 2020-2024 Five-Year Financial Plan Bylaw Adoption

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 30

Questions?

PROPOSED 2020-2024 FIVE-YEAR FINANCIAL PLAN

Slide 31