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Home My Public Portal About2022-2026 Financial Plan Bylaw 1408 TOWN OF OLIVER BYLAW 1408 A bylaw to adopt the 5 year financial plan for the calendar years 2022 through 2026. WHEREAS in accordance with Section 165 of the Community Charter, the Council is required, by bylaw, to adopt a Financial Plan for the municipality before the fifteenth day of May in each year; NOW THEREFORE, the Council of the Town of Oliver in open meeting assembled hereby enacts as follows: 1. Schedule "A" attached hereto and forming part of this bylaw is hereby adopted as the 5 Year Financial Plan of the Town of Oliver for the calendar years 2022 through 2026. 2. Schedule “B” attached hereto and forming part of this bylaw is hereby adopted as the Statement of Objectives and Policies for the 5 Year Financial Plan of the Town of Oliver for the calendar years 2022 through 2026. 3. This bylaw may be cited for all purposes as the "5 Year Financial Plan Bylaw 1408". 4. Authority to make expenditures in accordance with the 5 year financial plan is hereby delegated to the following Management Staff: 1) Chief Administrative Officer 2) Chief Financial Officer 3) Deputy Finance Officer 4) Corporate Officer 5) Deputy Corporate Officer 6) Director of Operations 7) Manager of Public Works 8) Manager of Utilities 9) Director of Development Services 8) Fire Chief 9) Deputy Fire Chief Read a first time on the 11th day of April, 2022. Public consultation through a Public Hearing on the 25th day of April, 2022 Read a second and third time on the 25th day of April, 2022. Adopted on the 9th day of May, 2022. ‘Original Signed by Mayor’ ‘Original Signed by Corporate Officer’ _____________________________ ________________________________ Mayor Corporate Officer - 2 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1408 Schedule “A” – 5 Year Financial Plan – 2022 through 2026 2022 2023 2024 2025 2026 Budget Budget Budget Budget Budget REVENUES User Fees 3,998,951 4,197,428 4,412,871 4,618,793 4,823,677 Property taxation 3,444,496 3,714,088 3,841,464 3,967,445 4,094,619 Government transfers 1,540,950 1,072,485 1,917,239 976,838 979,233 Concessions and franchise 443,785 443,785 443,785 443,785 443,785 Gain (loss) on disposal of TCA - - - - - Other revenue from own services 617,256 617,256 617,256 617,256 617,256 Sale of services 177,705 177,705 171,405 171,405 171,405 Investment income 40,000 40,000 40,000 40,000 40,000 Development cost charges - - - - - Contributions from developers and other 354,500 2,500 2,500 2,500 2,500 10,617,643 10,265,247 11,446,520 10,838,022 11,172,475 Transfer from Reserves Sewer Capital Reserve 811,000 232,950 191,970 407,700 442,000 Water Capital Reserve 270,000 547,000 1,438,000 408,000 70,000 Capital Reserve Community Works Fund 294,000 808,000 217,000 - - Equipment Reserve 218,000 96,000 370,000 121,000 148,000 Fire Joint Reserve 155,700 4,300 4,400 2,500 - Fire Town Reserve - 16,000 16,300 19,000 19,300 General Surplus 1,061,800 368,700 172,900 17,300 850,500 Land Reserve 399,975 - - - - Road Capital - 78,000 - - - Solid Waste Policing - - - - - Covid Safe Restart 131,152 20,000 20,000 - - Accum Surplus 653,580 527,191 472,192 331,742 275,650 Total Transfer 3,995,207 2,698,141 2,902,762 1,307,242 1,805,450 Total Revenues 14,612,850 12,963,388 14,349,282 12,145,264 12,977,925 - 3 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1408 Schedule “A” – 5 Year Financial Plan – 2022 through 2026 2022 2023 2024 2025 2026 Budget Budget Budget Budget Budget EXPENSES Water Services 2,988,887 3,036,705 3,059,030 3,097,096 3,124,261 General Government Services 1,272,567 1,298,018 1,323,978 1,350,458 1,377,467 Sewer Services 1,211,019 1,243,186 1,294,690 1,321,229 1,361,750 Transportation services & public works 1,549,512 1,580,502 1,612,112 1,644,354 1,677,241 Protective Services 1,683,511 1,717,181 1,751,525 1,786,556 1,822,287 Development Services 587,484 599,234 611,219 623,443 635,912 Environmental & public health services 442,772 451,627 460,660 469,873 479,270 9,735,752 9,926,453 10,113,214 10,293,009 10,478,188 ADJUSTED FOR NON-CASH ITEMS Amortization (1,444,857) (1,459,045) (1,473,517) (1,488,278) (1,503,335) Inventory expense (30,500) (30,500) (30,500) (30,500) (30,500) Prepaid expense (15,000) (15,000) (15,000) (15,000) (15,000) Subtotal (1,490,357) (1,504,545) (1,519,017) (1,533,778) (1,548,835) ADJUSTED FOR NON-CASH ITEMS Capital asset expenditures 7,517,200 2,308,950 3,449,400 7,089,300 2,641,100 Inventory expenditures 30,500 30,500 30,500 30,500 30,500 Prepaid expenditures 15,000 15,000 15,000 15,000 15,000 Debt principle repayments 391,562 606,318 602,381 614,699 626,246 Debt proceeds (2,813,900) - (45,500) (6,090,000) (1,092,000) 5,140,362 2,960,768 4,051,781 1,659,499 2,220,846 Transfer to Reserves Sewer Capital 234,756 332,733 318,809 340,982 322,718 Water Capital 198,589 389,987 573,064 705,241 872,440 Climate Action 450 450 450 450 450 Community Works Fund 274,770 277,518 280,293 - - Equipment Reserve 197,026 197,026 197,026 197,026 197,026 Equipment Self Insured 9,000 9,000 9,000 9,000 9,000 Fire Town 52,600 52,600 52,600 52,600 52,600 General Surplus 250,431 312,394 263,058 412,231 364,488 Solid Waste 5,467 5,000 5,000 5,000 5,000 Tucelnuit Water Trust 3,344 3,344 3,344 3,344 3,344 Water Capital Charge 660 660 660 660 660 1,227,093 1,580,712 1,703,304 1,726,534 1,827,726 Total Expenses 14,612,850 12,963,388 14,349,282 12,145,264 12,977,925 FINANCIAL PLAN BALANCE 0 0 0 0 0 - 4 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1408 Schedule “B” - Statement of Objectives and Policies In accordance with Section 165(3.1) of the Community Charter, the Town of Oliver (Town) is required to include in the Five Year Financial Plan, objectives and policies regarding each of the following: 1. The proportion of total revenue that comes from each of the funding sources described in Section 165(7) of the Community Charter; 2. The distribution of property taxes among the property classes, and 3. The use of permissive tax exemptions Funding Sources Table 1 below shows the proportion of total revenue anticipated to be raised from each funding source in 2022 for the consolidated operating and capital budget. Property taxes form approximately 15.8% of the overall funding sources of the municipality. The system of property taxation is relatively easy to administer and understand. It provides a stable and consistent source of revenue for many services that are difficult or undesirable to fund on a user-pay basis. These include services such as police services, general administration, fire protection, bylaw enforcement, snow removal, road maintenance, airport, and community buildings. For these reasons, property taxation will continue to be a substantial source of municipal revenue. The greatest source of municipal revenue is from user fees and sales of services. User fees attempt to apportion the value of a service to those who use the service. Approximately 88% of this user fee revenue represents water and sewer charges. Water and sewer system users fully pay for the costs of these systems, without subsidy from property taxes. The municipality strives to calculate full cost user fees for these services, which includes not only direct but indirect costs such as administration and operating overhead. Objectives • Over the next five years, where possible, the Town will endeavour to supplement revenues from user fees and charges, rather than taxation, to lessen the burden on its limited property tax base. • Investigate other potential funding sources and securing opportunities for additional revenues. Policies • The Town will review all user fee levels to ensure they are adequately meeting both the capital and delivery costs of the service. • The Town will endeavour to review and adjust user fees to maintain competitiveness with other municipalities or market rates. • Aggressively seek available grants for projects to mitigate the potential impact on property taxation rates. - 5 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1408 Schedule “B” - Statement of Objectives and Policies Table 1 – Sources of Funding (2022) Funding Source % Total Funding Dollar Value User fees and sale of services 25.8% $4,176,656 Grants 9.5% $1,540,950 Municipal Taxation, net 15.8% $2,556,290 Reserves, net 17.0% $2,768,114 Other sources 9.6% $1,553,093 Parcel taxes 4.9% $790,654 Development cost charges 0.0% $0 Debt 17.4% 2,813,900 TOTAL 100% $16,199,657 Distribution of Property Tax Rates Table 2 below shows the distribution of property tax revenue among the property classes. The residential property class provides the largest proportion of property tax revenue. This is appropriate as this class also forms the largest portion of the assessment base and consumes the majority of Town services. Objectives • Allow for a maximum business multiple not to exceed the Provincial multiple established by British Columbia Regulations 426/2003 and 439/2003 for the business class. • Ensure that business and light industry property tax multiples continue to be equal. • Over the next five years maintain tax stability by keeping the proportionate relationship between all other classes equal. • Over the next five years the property tax increases will ensure that the rate payers will reduce the financial burden associated with expected futures costs for the Town. Policies • Supplement, where possible, revenues from user fees and charges to help offset the burden on the entire property tax base. • Continue to apply additional taxes that would have been collected from new non- residential development against the tax increases in those classifications. This results in slowly reducing the proportions of taxes paid by the commercial sector in relation to the residential sector. • Regularly review and compare the Town’s distribution of tax burden relative to other municipalities in the South Okanagan. - 6 - Table 2 – Distribution of Property Tax Rates (2022) Property class % Property Value Tax Dollar Value Residential (1) 75.6% $1,929,351 Business (6) 19.0% $486,796 Utility (2) 3.5% $90,221 Light Industry (5) 1.7% $44,059 Recreation (8) & Farm (9) 0.2% $5,863 TOTAL 100% $2,556,290 - 7 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1408 Schedule “B” - Statement of Objectives and Policies Permissive Tax Exemptions The Community Charter permits council to provide permissive tax exemptions for a period of up to 10 years for specific types of properties. Council adopted a 4 year bylaw, pursuant to section 224 of the Community Charter, which is in effect for 2022. The Annual Municipal Report for 2021 contains a list of permissive exemptions and the amount of tax revenue foregone. The list demonstrates the policy of council that permissive exemptions are granted to not-for-profit institutions that form a valuable part of our community. Many property tax exemptions are provided to properties automatically by the Assessment Authority of BC. For example, properties owned by the municipality or other levels of government are exempted 100%. Other properties such as churches and hospitals are generally exempted only for buildings and the land directly beneath the footprint of the building. Objectives • Council’s principle objective in considering permissive tax exemptions under section 224 is to provide financial assistance to organizations that provide a valuable service to the broader community. These services may include cultural and recreational opportunities for adults and youth, promotion of the local economy and local charitable services. • Council’s principle objective in considering permissive tax exemptions under section 226 is to provide a short-term financial incentive to promote certain types of economic development. Policies • Provide permissive tax exemptions for all qualifying land uses to those organizations that provide valuable services to the broader community. • Integrate the revitalization tax exemption program into the Town’s existing initiatives as a means of attracting retail, commercial and industrial businesses to further invest in the community.