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Home My Public Portal AboutRegular Open Council - 25 Mar 2013 - PdfTOWN OF OLIVER REGULAR OPEN COUNCIL MONDAY, MARCH 25, 2013 AT 7:00 PM Council Chambers AGENDA Page A. CALL TO ORDER B. ADOPTION OF AGENDA 1. Adoption C. ADOPTION OF PRIOR MINUTES 5 - 11 1. Minutes of March 11, 2013 Regular meeting D. BUSINESS ARISING OUT OF PRIOR MINUTES E. COMMITTEE REPORTS 13 - 15 1. Minutes of March 11, 2013 Committee of the Whole meeting 2. Verbal Report from the Chairperson of the March 25, 2013 Committee of the Whole meeting F. WATER MATTERS 17 - 24 1. 2013-2014 Water Capital Projects Loan Authorization Bylaw 1340 2013-2014 Water Capital Projects Temporary Borrowing Bylaw 1341 - Chief Financial Officer's report attached 25 - 29 2. Water Quality Summary Report for February 2013 - Engineering Technologist's report attached G. DELEGATIONS & PETITIONS H. DEVELOPMENT PERMIT/VARIANCE HEARINGS I. BYLAWS 31 - 35 1. 5 Year Financial Plan Bylaw 1337 - for adoption - bylaw attached 37 - 64 2. Revitalization Tax Exemption Bylaw 1328 - Municipal Manager's report and bylaw attached Regular Open Council of March 25, 2013 65 - 71 3. Civic Addressing Amendment Bylaw 1320.01 - Municipal Manager's report attached J. BUSINESS 73 - 83 1. Award of Bylaw Services Contract - Deputy Corporate Officer's report attached 85 - 113 2. Gas Tax Grants - Contribution Agreements - Municipal Manager's report attached 115 - 130 3. Protocol Agreements with Indian Bands - Municipal Manager's report attached K. CORRESPONDENCE 131 - 143 1. Correspondence Report - Deputy Corporate Officer's report attached L. REPORTS 1. Councillor Bennest 2. Water Councillor Miller 3. Water Councillor Machial 4. Councillor Larson 5. Councillor Doerr 6. Councillor Mattes 7. Mayor Hovanes M. UPCOMING MEETINGS 1. Monday April 8, 2013 - 4:00 pm - Committee of the Whole Meeting Monday April 8, 2013 - 7:00 pm - Regular Meeting Monday April 22, 2013 - 4:00 pm - Committee of the Whole Meeting Monday April 22, 2013 - 7:00 pm - Regular Meeting N. PUBLIC QUESTION PERIOD This is an opportunity for the audience to ask questions regarding matters discussed during the current meeting. O. ADJOURNMENT 1. Adjournment Page 2 of 143 Regular Open Council of March 25, 2013 Page 3 of 143 Page 4 of 143 MINUTES OF THE REGULAR MEETING OF THE COUNCIL OF THE TOWN OF OLIVER HELD ON MONDAY, MARCH 11, 2013 IN THE COUNCIL CHAMBER Present: Mayor Hovanes Councillors Doerr, Bennest, and Mattes Water Councillors Miller and Machial Regrets: Councillor Larson Staff: T. Szalay, Municipal Manager L. Schultz, Deputy Corporate Officer A CALL TO ORDER Mayor Hovanes called the meeting to order at 7:00 pm B ADOPTION OF AGENDA B-1 Adoption of Agenda R-60/13 It was MOVED and SECONDED That the agenda be adopted as amended by adding : • Irrigation Turn on Date (F-1) CARRIED C ADOPTION OF PRIOR MINUTES C-1 Minutes of the February 25, 2013 Regular meeting R-61/13 It was MOVED and SECONDED That the minutes of the February 25, 2013 regular meeting be adopted as circulated. CARRIED C-2 Minutes of the February 25, 2013 Public Hearing R-62/13 It was MOVED and SECONDED That the minutes of the February 25, 2013 Public Hearing be adopted as circulated CARRIED D BUSINESS ARISING OUT OF PRIOR MINUTES None ITEM C. - 1. Page 5 of 143 Regular Open Minutes of March 11, 2013 E COMMITTEE REPORTS E-1 Minutes of February 25, 2013 Committee of the Whole meeting R-63/13 It was MOVED and SECONDED That the minutes of the February 25, 2013 Committee of the Whole meeting be received. CARRIED E-2 Verbal Report from the Chairperson of the March 11, 2013 Committee of the Whole meeting. Councillor Bennest provided a verbal report on the items discussed during the Committee of the Whole meeting earlier in the day. F WATER MATTERS F-1 Irrigation Turn on Dates R-64/13 It was MOVED and SECONDED That the canal diversion start date be April 2nd , 2013; and That Irrigation season startup date be set for April 11th, 2013. CARRIED G BYLAWS G-1 Zoning Amendment Bylaw 1330.05 The Municipal Manager gave a brief overview of Bylaw 1330.05 R-65/13 It was MOVED and SECONDED That the Public Hearing report be received; and That Bylaw 1330.05 be adopted. CARRIED ITEM C. - 1. Page 6 of 143 Regular Open Minutes of March 11, 2013 G-2 5 Year Financial Plan Bylaw 1337 R-66/13 It was MOVED and SECONDED That Council rescind third reading of “5 Year Financial Plan Bylaw 1337” read on February 12, 2013; and That Council re-read “5 Year Financial Plan Bylaw 1337” a third time as amended due to the addition of Lakeside Drive improvements capital project which is to be fully funded by reserves. CARRIED H BUSINESS Councillor Doerr left the Council Chambers at 7:09 pm declaring a conflict of interest. H-1 Lakeside Drive Improvements The Municipal Manager summarized his report. R-67/13 It was MOVED and SECONDED That the 2013 budget be amended by transferring the following allocations to pay for Lakeside Drive Improvements: • Land Sale Reserve Fund: $47,500 • Sewer Capital Reserve Fund $13,500 • Road Capital Fund $102,000; and That the Lakeside Drive Improvement Contract be awarded to the low bidder, Mike Johnson Excavating Ltd. for the bid price of $132,839 plus contingency and HST. CARRIED H-2 Sidewalk Frontage of Lots 2 & 3 Plan 4128 Lakeside Drive R-68/13 It was MOVED and SECONDED That the Town of Oliver award the Sidewalk Frontage of Lots 2 and 3 Plan 4128 Lakeside Drive tender to Mike Johnson Excavating per their tender of $157,739.68 CARRIED ITEM C. - 1. Page 7 of 143 Regular Open Minutes of March 11, 2013 H-3 Tuc-El-Nuit Area Manhole Rehabilitation R-69/13 The Municipal Manager summarized his report. - Have invoiced Vincor for 40% of this tender. It was MOVED and SECONDED That the Town of Oliver award the Tuc-El-Nuit Area Manhole Rehabilitation project to Mike Johnson Excavating per their tender of $109,200.00 CARRIED Councillor Doerr re-entered the Council Chambers at 7:14 pm H-4 Appointments to the Board of Variance R-70/13 It was MOVED and SECONDED THAT Council appoints Dave Corbeil, Jim Cavin and Marg Chadsey to the Board of Variance. CARRIED H-5 Casa Rio Phased Strata Development - Election not to Proceed with Phase 4 The Municipal Manager summarized his report R-71/13 It was MOVED and SECONDED That staff be instructed to file a cancellation notice in respect DP 2004-11 on the title of the undeveloped portion of the Casa Rio Development at 921 Spillway Road, legally described as: - Lot A, District Lot 2450s, Similkameen Division Yale District, Plan KAP79215, Except Strata Plan KAS3036 (Phases 1, 2 And 3); and That the Registered Owner of Remainder Lot A, above, be so advised. CARRIED I CORRESPONDENCE I-1 Correspondence Report a) Letter dated February 18, 2013 from Alex Atamanenko, MP for BC Southern Interior regarding recent Canada Post decision to review all post offices across the country in an effort to move towards a “new smaller retail model”. ITEM C. - 1. Page 8 of 143 Regular Open Minutes of March 11, 2013 R-72/13 It was MOVED and SECONDED That Council receive and file the letter received from Alex Atamanenko regarding recent Canada Post decision. CARRIED R-73/13 b) E-mail received March 6, 2013 from Royal Canadian Legion re: Town of Oliver Veterans Support Ad. It was MOVED and SECONDED That Council authorize the expenditure of $450.00 for renewing the ¼ Page Support/Remembrance Ad in the Military Service Recognition Book. CARRIED R-74/13 c) Strategic Community Investment Fund Plan and Progress Reports sent to the Ministry of Community, Sport & Cultural Development. d) Correspondence in the Council Reading File It was MOVED and SECONDED That the Strategic Community Investment Fund Plan and Progress reports and the correspondence in the Council Reading File be received. CARRIED J REPORTS J-1 Building Permit Report for the month of February 2013 R-75/13 It was MOVED and SECONDED That the Building Permit report for the month of February 2013 be received. CARRIED J-2 Oliver Fire Department report for the month of February 2013 R-76/13 It was MOVED and SECONDED That the Oliver Fire Department report for the month of February 2013 be received. CARRIED ITEM C. - 1. Page 9 of 143 Regular Open Minutes of March 11, 2013 J-3 Councillor Mattes • George Bowering at library J-4 Councillor Bennest • Today’s meetings J-5 Water Councillor Miller • George Bowering at library • Today's meetings J-6 Water Councillor Machial • Today's meeting J-7 Councillor Doerr • AAC meeting J-8 Mayor Hovanes • Met with land owner • Met with 2 business people • Water Twinning Press release K UPCOMING MEETINGS K-1 Monday March 25, 2013 - 4:00 pm - Committee of the Whole Meeting Monday March 25, 2013 - 7:00 pm - Regular Meeting Monday April 8, 2013 - 4:00 pm - Committee of the Whole Meeting Monday April 8, 2013 - 7:00 pm - Regular Meeting Monday April 22, 2013 - 4:00 pm - Committee of the Whole Meeting Monday April 22, 2013 - 7:00 pm - Regular Meeting L PUBLIC QUESTION PERIOD An opportunity was provided for the audience to ask questions regarding matters discussed during the current meeting. • Ruth Desaultes - B Building Casa Rio M ADJOURNMENT R-77/13 It was MOVED and SECONDED That the meeting be adjourned. CARRIED The meeting was adjourned at 7:40 pm ITEM C. - 1. Page 10 of 143 Regular Open Minutes of March 11, 2013 CERTIFIED AS CORRECT Mayor Deputy Corporate Officer ITEM C. - 1. Page 11 of 143 Page 12 of 143 MINUTES OF THE COMMITTEE OF THE WHOLE MEETING OF THE COUNCIL OF THE TOWN OF OLIVER HELD ON MONDAY, MARCH 11, 2013 IN THE COUNCIL CHAMBERS Present: Chairperson Bennest Mayor Hovanes Councillors Doerr and Mattes Water Councillors Miller Regrets: Councillor Larson Staff: T. Szalay, Municipal Manager L. Schultz, Deputy Corporate Officer S. Goodsell, Director of Operations A CALL TO ORDER Councillor Bennest called the meeting to order at 2:00 pm B ADOPTION OF AGENDA CW-32/13 It was MOVED and SECONDED That the agenda be adopted as amended by moving Water Matters (E-1) after Business. CARRIED C ADOPTION OF COMMITTEE MINUTES C-1 Minutes of the February 25, 2013 Committee of the Whole meeting CW-33/13 It was MOVED and SECONDED That the minutes of the February 25, 2013 Committee of the Whole meeting be adopted as circulated. CARRIED D BUSINESS ARISING OUT OF PRIOR MINUTES None E BUSINESS E-1 Airport Operational Guide - Presentation by Paul Dumoret - 3 Bar Consulting Group ITEM E. - 1. Page 13 of 143 Special Open meeting minutes of March 11, 2013 Mr. Dumoret introduced the other main resource persons involved: - Jack Willms - Mike Creasy - Kevin Alexander Mr. Dumoret gave a brief overview on what is required in an Airport Operations Manual and discussion ensued. Mr. Willms commented: • Very few airports our size that have the development that we have here in Oliver. • Very encouraging to see. • Economic generator in our community, but don't normally see that in smaller airports like ours. E-2 House and Business Address Numbering -Verbal report from Councillor Bennest and a discussion ensued: • There are a large number of businesses that have not changed their house numbers as well as a large amount of residences. • Original letters were sent to everyone in October 2011. • BC ambulance volunteered their members and went out and advised people. • It is an offense to not have your house numbered and people could be ticketed. • Would like to see a safe, compliant community • Numbers must be no more than 4" high and clearly visible on your house or in your yard. Paper numbers are only 2" high. • Next step is to send out a notice in the next water bill mail out. F WATER MATTERS F-1 Irrigation and Canal Diversion Start Dates - The Director of Operations summarized his report. CW-34/13 It was MOVED and SECONDED Recommend opening for discussion; and That the recommendation be forwarded to the regular meeting of March 11, 2013. CARRIED ITEM E. - 1. Page 14 of 143 Special Open meeting minutes of March 11, 2013 G PUBLIC QUESTION PERIOD An opportunity was provided for the audience to ask questions regarding matters discussed during the current meeting. H ADJOURNMENT CW-35/13 It was MOVED and SECONDED That the meeting be adjourned. CARRIED The meeting was adjourned at 3:26 pm CERTIFIED AS CORRECT Chairperson Deputy Corporate Officer ITEM E. - 1. Page 15 of 143 Page 16 of 143 ITEM F. - 1. Page 17 of 143 ITEM F. - 1. Page 18 of 143 ITEM F. - 1. Page 19 of 143 ITEM F. - 1. Page 20 of 143 ITEM F. - 1. Page 21 of 143 ITEM F. - 1. Page 22 of 143 ITEM F. - 1. Page 23 of 143 ITEM F. - 1. Page 24 of 143 ITEM F. - 2. Page 25 of 143 ITEM F. - 2. Page 26 of 143 ITEM F. - 2. Page 27 of 143 ITEM F. - 2. Page 28 of 143 ITEM F. - 2. Page 29 of 143 Pa g e 3 0 o f 1 4 3 TOWN OF OLIVER BYLAW 1337 A bylaw to adopt the 5 year financial plan for the calendar years 2013 through 2017. 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 2013 through 2017. 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 2013 through 2017. 3. This bylaw may be cited for all purposes as the "5 Year Financial Plan Bylaw 1337". 4. Authority to make expenditures in accordance with the 5 year financial plan is hereby delegated to the following Officers, or their successors in title should the Officers’ Bylaw be amended: 1) Municipal Manager 2) Chief Financial Officer 3) Manager of Financial Services 4) Corporate Officer 5) Deputy Corporate Officer 6) Director of Operations 7) Fire Chief 8) Deputy Fire Chief 9) Director of Development Services Read a first, second and third time on the 12th day of February, 2013. Third Reading Rescinded and Re-read a third time on the 11th day of March, 2013. Adopted on the ___ day of _______, 2013. _____________________________ ________________________________ Mayor Deputy Corporate Officer ITEM I. - 1. Page 31 of 143 - 2 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1337 Schedule “A” – 5 Year Financial Plan – 2013 through 2017 2013 2014 2015 2016 2017 Budget Budget Budget Budget Budget REVENUES Municipal Taxation, net 2,156,373 2,201,118 2,246,830 2,293,533 2,344,650 Grants in Lieu of Taxes 11,595 11,827 12,063 12,305 12,551 Sale of Services and rentals 115,923 118,241 120,606 123,018 125,479 Contracts and Franchise Fees 262,771 260,000 260,000 260,000 260,000 Grants 2,348,825 617,525 737,806 727,916 727,916 Water User Fees 2,158,650 2,309,756 2,379,048 2,450,420 2,572,941 Sewer User Fees 779,331 791,021 802,886 814,930 839,377 Development Cost Charges 0 0 0 519,800 145,000 Contributions, Donations and Other 2,519,735 452,204 460,665 459,294 468,096 10,353,203 6,761,692 7,019,905 7,661,215 7,496,009 EXPENSES Water Services 2,563,482 2,697,057 2,765,313 2,838,188 2,921,613 General Government Services 1,059,290 1,092,653 1,118,674 1,142,641 1,200,673 Waste Water Services 940,674 967,851 962,470 1,047,414 1,097,180 Transportation Services 1,389,247 1,424,210 1,455,369 1,491,404 1,540,382 Protective Services 430,207 444,671 454,361 461,286 493,804 Development Services 252,386 261,220 270,362 279,825 289,619 Public Health and Welfare Services 238,243 246,582 255,212 264,144 273,389 6,873,529 7,134,243 7,281,760 7,524,902 7,816,661 SURPLUS (DEFICIT) FOR THE YEAR 3,479,674 (372,551) (261,855) 136,313 (320,652) ADJUSTED FOR NON-CASH ITEMS Amortization 1,356,469 1,365,504 1,352,489 1,377,523 1,437,451 Inventory expense 30,500 30,500 30,500 30,500 30,500 Prepaid expense 15,000 15,000 15,000 15,000 15,000 1,401,969 1,411,004 1,397,989 1,423,023 1,482,951 TOTAL CASH FROM OPERATIONS 4,881,644 1,038,452 1,136,135 1,559,336 1,162,299 ADJUSTED FOR CASH ITEMS Capital asset expenditures (7,392,050) (1,579,300) (1,242,200) (3,488,000) (2,076,700) 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 (304,497) (383,434) (369,974) (345,377) (480,838) Debt proceeds 1,455,600 119,500 253,000 2,080,200 710,600 Transfer from (to) reserves 1,047,215 466,135 78,793 171,859 547,484 Transfer from (to) surplus 357,589 384,147 189,746 67,482 182,655 (4,881,643) (1,038,452) (1,136,135) (1,559,336) (1,162,299) FINANCIAL PLAN BALANCE 0 0 0 0 0 ITEM I. - 1. Page 32 of 143 - 3 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1337 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 2013 for the consolidated operating and capital budget. Property taxes form approximately 10% of the overall revenue 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 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 87% 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. ITEM I. - 1. Page 33 of 143 - 4 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1337 Schedule “B” - Statement of Objectives and Policies Table 1 – Sources of Funding (2013) Funding Source % Total Funding Dollar Value User fees & sales of services 26% $3,383,310 Grants 17% $2,274,825 Developer contributions 15% $1,996,900 Proceeds from borrowing 11% $1,455,600 Reserves 11% $1,404,804 Property taxes 10% $1,298,517 Other sources 6% $871,201 Parcel taxes 4% $528,450 TOTAL 100% $13,213,606 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 keep the property tax increase close to the cost of living. 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. Table 2 – Distribution of Property Tax Rates (2013) Property class % Property Value Tax Dollar Value Residential (1) 71% $924,096 Business (6) 25% $328,870 Light Industry (5) 2% $25,898 Utility (2) 1% $15,669 Farm & Recreation (8 & 9) 1% $3,984 TOTAL 100% $1,298,517 ITEM I. - 1. Page 34 of 143 - 5 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1337 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 10-year bylaw, pursuant to section 224 of the Community Charter, which is in effect to 2014. The Annual Municipal Report for 2011 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. Also, in 2013, council will review the current tax exemption bylaw to ensure the criteria being used are still relevant to the overall goals and objections of the bylaw. • Develop a revitalization tax exemption program in 2013 which details the kinds of activities the program will target within the Downtown Commercial, Core Area Residential, Industrial and Airport zones. • Integrate the revitalization tax exemption program into the Town’s existing initiatives as a means of attracting retail, commercial businesses to further invest in the community. ITEM I. - 1. Page 35 of 143 Page 36 of 143 Town of Oliver STAFF REPORT Report to: Regular Council Meeting of March 25, 2013 From: Tom Szalay, Municipal Manager Date: March 21, 2013 Subject: Revitalization Tax Exemption Bylaw 1328 – Second Reading Action: Recommendation File: BYL 1328 1.0 PURPOSE: This report provides a summary of progress made on Bylaw 1328 since first reading and seeks second reading from council. 2.0 RECOMMENDATIONS: It is recommended: A. That Revitalization Tax Exemption Bylaw 1328 be read a second time; and B. That staff proceed with publishing the required two notices respecting Bylaw 1328, as set out in section 227(3) and section 94 of the Community Charter. Tom Szalay, P. Eng. Municipal Manager W:\Legsltive and Regltry Services\Bylaws\Proposed\Bylaw 1328 - Revitalization tax exemption\council-rpt-ts-bylaw 1328 second reading.docx 3.0 BACKGROUND: In 2012, council explored the feasibility of implementing a revitalization area tax exemption b y- law under section 226 of the Community Charter. Following a detailed discussion with council various options on November 13, 2012, staff proceeded to draft Revitalization Tax Exemption Bylaw 1328 for council’s consideration. The original draft of Bylaw 1328 was read a first time by council on January 14, 2013. ITEM I. - 2. Page 37 of 143 March 21, 2013 Revitalization Tax Exemption Bylaw 1328 - Second Reading Page 2 Since first reading, staff have been working on various enhancements to Bylaw 1328, both as directed by council on January 14, 2014 and in consultation with legal counsel. A summary of changes made since January is provided below: 1. The exemption area in the Downtown Commercial area (Schedule C) has been amended to include two additional commercial properties. 2. As directed by council, the initial ten-year exemptions proposed at first reading have been amended to provide full exemptions for 5 years only with decreasing exemption in years 6 to 10. The resulting exemptions for new construction of commercial, industrial and rental or co - op housing are summarized below: Improvements Exemption (percentage of Construction Value) Land Exemption (rental and co-op housing only) Year 1st Reading 2nd Reading 1st Reading 2nd Reading 1 to 5 100% 100% 33% 35% 6 100% 80% 33% 30% 7 100% 60% 33% 25% 8 100% 40% 33% 20% 9 100% 20% 33% 15% 10 100% 10% 33% 10% 3. Commercial/industrial renovations and strata housing for owner occupancy continue to r e- ceive 5-year exemptions only, as at first reading. 4. Despite paragraph 1 above, at council’s direction, hotel construction in the downtown co m- mercial revitalization zone has been ret ained at 100% of Construction Value for a full 10 years. This is set out in section 4(10 of Schedule C. A definition has been added for an “Eli- gible Hotel Development” in section 2 of the main bylaw. 5. The qualification deadline has been more clearly defined in section 9. In effect it has been extended in that only the Exemption Agreement needs to be executed by June 29, 2018, where previously, all work had to be completed by that date. 6. The form of Exemption Agreement to be used has been added as Schedule A. This agreement sets out the type of construction that is proposed on a property and the amount of exemption that will be granted if the construction is completed as set out in the bylaw and the agre e- ment. Such an agreement is required in the Community Charter and provides the applicant with the assurance that an exemption certificate will be issued if the specified work is co m- pleted. As set out in section 16 of the bylaw, council will need to endorse any Exemption agreement before it is executed. 7. The form of Exemption Certificate has been added as Schedule B. This certificate is co m- pleted and issued by the Chief Financial Officer upon satisfaction of the Exemption Agre e- ment (i.e. project completion) by the Owner, and submitted to the BC Assessment Autho rity. The Certificate sets out the exact amount of exemption being provided and sets out the r e- ITEM I. - 2. Page 38 of 143 March 21, 2013 Revitalization Tax Exemption Bylaw 1328 - Second Reading Page 3 quirements that must continue to be met in order to keep the certificate in force. Any viola- tion of the certificate terms results in a cancellation of the exempt ion. 8. Section 20 has been added, to provide for recapture of taxes should an Exemption Certificate be cancelled. 9. The tax exemption criteria have been tightened and more clearly define by section 14 of the main bylaw, and repeated in the Exemption Agreement (Schedule A) and the Exemption Cer- tificate (Schedule B). 10. Several other legal clarifications have been made throughout the bylaw. 4.0 NEXT STEPS: Council is asked to consider reading Bylaw 1328 a second time on March 25, 2013. If this o c- curs, staff can post the statutory notices in the local newspaper April 3 and April 10 , 2013. Council could consider third reading at the regular meeting of April 8, 2013. In the meantime, staff will do a final review and include any additional clarification in the bylaw , if needed. Final adoption could be scheduled for the regular meeting of April 22, 2013. ITEM I. - 2. Page 39 of 143 TOWN OF OLIVER BYLAW 1328 A bylaw to establish a Revitalization Tax Exemption Program to provide relief from certain municipal property taxes for eligible development projects. Whereas: A. Council wishes to encourage revitalization by providing certain tax exemptions for qualifying developments in designated areas of Oliver; B. Council may provide revitalization tax exemptions pursuant to section 226 of the Community Charter; C. Council has given notice of its intention to adopt this Bylaw in accordance with section 227 of the Community Charter; D. Council has considered this Bylaw in conjunction with the objectives and policies set out under section 165 (3.1) (c) of the Community Charter in its financial plan; Now therefore, the Council of the Town of Oliver, in open meeting assembled, enacts as follows: Citation 1. This bylaw may be cited for all purposes as “Revitalization Tax Exemption Bylaw 1328”. Definitions 2. In this Bylaw: “Apartment Building” means a non-strata building under single ownership used or to be used for monthly rental of individual dwelling units. “Application Form” is the form referred to in section 14(2). “Building Inspector” means the person designated to issue building permits and to perform building inspections pursuant to the Town’s Building Bylaw and the British Columbia Building Code. “Construction Value” means the estimated value of construction, acceptable to the Building Inspector and using the methodology for determining the value of construction on a building permit, and, if required by the Building Inspector, must be determined by an estimate prepared by the Owner’s architect or engineer. To the extent necessary, the Building Inspector may divide the Construction Value into separate components representing new construction, renovations and additions, as well as industrial, commercial and residential building components. For Eligible Strata Developments, Construction Value for a strata lot ITEM I. - 2. Page 40 of 143 Revitalization Tax Exemption Bylaw 1328 Page 2 of 25 shall be the Construction Value for the entire development divided by the number of strata lots. “Co-op” means a development that is set up and operated as a housing cooperative under the Cooperative Association Act of British Columbia. “Council” means the elected council of the Town of Oliver. “Designated Officer” means the person authorized by Council under section 3 of this Bylaw to administer this Bylaw. “Eligible Hotel Development” means a building or group of buildings containing not less than 50 sleeping units which are available to the general public for short term daily occupancy for not less than 182 days each year. An Eligible Hotel Development may include attached or ancillary conference and recreation facilities, restaurants, service businesses and retail outlets. If sleeping units are stratified, the strata lots must be subject to a Land Title Act, section 219 covenant requiring them to be used for tourist occupancy not less than 182 days each calendar year. “Eligible Housing Development” means an Apartment Building, a Co-op, or a building containing Restricted Strata Units. “Eligible Improvement” means a building or part of a building for which a tax exemption under this Bylaw is granted. “Exemption Agreement” means a revitalization tax exemption agreement referred to in section 15. “Exemption Certificate” means a tax exemption certificate referred to in section 17. “Final Inspection” means a written notice issued by the Building Inspector certifying that all work related to a building permit has been completed. “Occupancy Permit” means written authorization from the Building Inspector to occupy a building for its intended use. “Oliver Airport” means the property operated as an airport by the Town, comprised of the following parcel of land: Parcel Identifier: 007-629-583; Lot 2, DL 2450s, SDYD, Plan 38137, Except Plan 40263 and Plan KAP70549. “Owner” means the registered owner of a property or group of properties for which a tax exemption under this Bylaw has been applied for or granted and includes a tenant leasing land from the Town on the Oliver Airport. “Program” means the revitalization tax exemption program established under this Bylaw. ITEM I. - 2. Page 41 of 143 Revitalization Tax Exemption Bylaw 1328 Page 3 of 25 “Property” means a parcel or group of parcels within a Revitalization Zone that is eligible for a tax exemption under this Bylaw. “Restricted Strata Unit” means a strata lot within a multi-unit residential building that is subdivided under the Strata Property Act, and that is subject to a no separate sale covenant under section 219 of the Land Title Act, and that is subject to a housing agreement under section 905 of the Local Government Act, restricting the use of the dwelling unit to rental only for a period of at least 10 years following receipt of an Occupancy Permit. “Revitalization Zone” means a geographical area of the Town that has been established to provide tax exemptions for qualifying developments within that zone. “Strata Unit” means a strata lot within a multi-unit residential building that is subdivided under the Strata Property Act. “Town” means the Town of Oliver as a municipal corporation or the physical boundaries of the Town of Oliver, as the context requires. “Work” means site servicing, building construction, and landscaping related to a development for which a tax exemption is issued under this Bylaw. Designated Officer 3. The person appointed as the Chief Financial Officer of the Town is appointed as the Designated Officer to administer this Bylaw. In addition, a person appointed as Deputy Chief Financial Officer may also act as the Designated Officer in place of the Chief Financial Officer. Delegation to Designated Officer 4. For each Exemption Agreement that is entered into pursuant to this Bylaw, Council hereby delegates to the Designated Officer the authority to solely sign and issue the applicable Exemption Certificate. Establishment of Revitalization Zones 5. This Bylaw creates the Revitalization Zones listed below: (1) Downtown Commercial Revitalization Zone, as described in Schedule C; (2) Core Area Residential Revitalization Zone, as described in Schedule D; (3) Industrial Revitalization Zone, as described in Schedule E; and (4) Airport Revitalization Zone, as described in Schedule F. ITEM I. - 2. Page 42 of 143 Revitalization Tax Exemption Bylaw 1328 Page 4 of 25 Revitalization Tax Exemption Program – Reasons and Objectives 6. The Revitalization Tax Exemption Program is hereby established. The reasons for and objectives of the Program are to foster economic growth, community revitalization, and housing availability by encouraging the construction and renovation of buildings within the Revitalization Zones established in this Bylaw. More specific objectives of each Revitalization Zone are stated in the Schedules. 7. The Program is intended to accomplish its objectives by providing property tax relief for qualifying developments in Revitalization Zones. Qualification Deadline 8. This Bylaw commences on the date of its adoption, and developments that are under construction as of that date or for which a building permit has been issued on or prior to that date are not eligible for a tax exemption under this Bylaw. 9. In order to be eligible for an Exemption Certificate under this Bylaw, an Owner of a Property must submit a completed Application Form for a tax exemption on or before May 31, 2018 and enter into a Tax Exemption Agreement with the Town on or before June 29, 2018. Scope of Tax Exemption 10. The tax exemption available under this Bylaw is limited to the property value taxes imposed for general municipal purposes by the Town under section 197(1)(a) of the Community Charter. 11. This Bylaw is intended to provide tax relief only and nothing in this Bylaw shall be interpreted such that an Owner is entitled to a tax refund or any other payment from the Town. 12. If the Eligible Improvement is destroyed or demolished or otherwise removed, the tax exemption for improvements, and the tax exemption for land (if applicable) under this Bylaw, shall cease until another Eligible Improvement has been reconstructed on the Property within the term of the tax exemption. Strata Subdivision 13. Where an Eligible Improvement is a strata lot or is subdivided into a strata lot under the Strata Property Act: (1) the tax exemption for improvements under this Bylaw for each strata lot will be granted such that the tax on improvements for that strata lot will be imposed on the assessed value of the improvements minus (total Construction Value apportioned in accordance with the unit entitlement of the strata lot), and (2) the tax exemption for land under this Bylaw (if applicable) for each strata lot will be granted such that the tax on land for that strata lot will be imposed on the assessed value of the land minus 35% of the assessed value of the land. ITEM I. - 2. Page 43 of 143 Revitalization Tax Exemption Bylaw 1328 Page 5 of 25 Tax Exemption Criteria 14. In order to qualify for a tax exemption, the following criteria must be met in relation to a Property: (1) Compliance with Bylaw – There must be strict compliance with the criteria established by this Bylaw, including its Schedules. (2) Application – An completed Application Form for tax exemption under this Bylaw must be submitted by the Owner in writing to the Town on the form established by the Designated Officer from time to time, but completion of the form does not relieve the Owner from providing all additional information required by the Designated Officer. (3) Exemption Agreement – Upon submission of a satisfactory application, an Exemption Agreement must be approved by Council and executed by the Owner and the Town, and the Owner must not be in breach of the Agreement during the term of the Agreement. (4) Exemption Certificate – Once all the requirements of the Exemption Agreement are complied with, an Exemption Certificate must be issued and there must be compliance with the conditions of the Exemption Certificate. (5) No Government Orders – The construction on the Property must not be a response to an order of the Town or of another public authority. (6) Payment of Taxes – All property taxes, rates, fees, and other charges levied by the Town, including penalties and interest, on the Property and on other land owned by the Owner within the Town. must have been paid at the time of application for the Tax Exemption and be kept current during the terms of the Exemption Agreement and the Exemption Certificate.. (7) Compliance with Laws –The Owner must, at the time of the application for the tax exemption, be using and occupying the Property in compliance with and at all times during the term of the tax exemption must use and occupy the Property in compliance with all enactments, regulations, and orders of any authority having jurisdiction and, without limiting the generality of the foregoing, all federal, provincial, or municipal laws, statutes, bylaws, licences, permits, and approvals, including all the rules, regulations, policies, guidelines, criteria or the like made under any such laws. Form of Exemption Agreement 15. The substantive terms of the Exemption Agreement to be entered into under this Bylaw are contained within the agreement attached as Schedule A, subject to such additional site- specific conditions as are considered necessary by the Designated Officer or by Council in respect of any particular Land. Timing of Agreement 16. When an Owner has completed the Application Form and provided all other information required by the Designated Officer, all to the satisfaction of the Designated Officer, the ITEM I. - 2. Page 44 of 143 Revitalization Tax Exemption Bylaw 1328 Page 6 of 25 Designated Officer will request that Council consider entering into an Agreement with the Owner. Exemption Certificate 17. Once the conditions established under the Exemption Agreement have been met, an Owner of Property shall be entitled to an Exemption Certificate issued by the Designated Officer with the substantive terms of the certificate attached as Schedule B, plus any other site- specific conditions contained in the Exemption Agreement for that Property. Date of Effectiveness of Certificate 18. Where the Exemption Certificate is issued on or before October 31 of a given year, the first year of the tax exemption is the taxation year subsequent to the year in which the Exemption Certificate is issued. Where the Exemption Certificate is issued after October 31 of a given year, the first year of the tax exemption is the second year following the year in which the Exemption Certificate is issued. Cancellation of Exemption Certificate 19. An Exemption Certificate will be cancelled by Council: (1) on the request of the Owner; or (2) if any of the conditions in the Exemption Certificate are not met. Recapture of Taxes 20. If Property that has benefitted from a tax exemption under the Program established by this Bylaw ceases to meet all the conditions of the Exemption Certificate, then the Exemption Certificate shall be cancelled and all tax exempted commencing in the calendar year in which the conditions under the Exemption Certificate were not met shall be calculated by the Designated Officer and shall become a debt immediately payable by the Owner at that time to the Town and must be repaid by the Owner at that time. Interest shall be calculated on the outstanding amount, from the date the conditions of the Exemption Certificate were not met, at the rate set by the Province for arrears of taxes, compounded monthly and shall continue to accrue until the debt is paid in full. No Multiple Exemptions 21. Notwithstanding any other provision of this Bylaw, a Property which is receiving a tax exemption pursuant to any other bylaw may not apply for or qualify for a tax exemption under this Bylaw. Schedules 22. This Bylaw includes and incorporates the following six schedules: Schedule A – Form of Exemption Agreement Schedule B – Form of Exemption Certificate Schedule C – Downtown Commercial Revitalization Zone ITEM I. - 2. Page 45 of 143 Revitalization Tax Exemption Bylaw 1328 Page 7 of 25 Schedule D – Core Area Residential Revitalization Zone Schedule E – Industrial Revitalization Zone Schedule F – Airport Revitalization Zone Read a First time on January 14, 2013. Read a Second time on ________________________, 2013. Read a Third time on _______________________, 2013. Notice pursuant to section 227(3) of the Community Charter was published on ________________, 2013 and on __________________, 2013. Adopted on ______________________, 2013. Mayor Corporate Officer ITEM I. - 2. Page 46 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule A Page 8 of 25 Schedule A – Form of Exemption Agreement THIS AGREEMENT dated for reference the ___ day of ___________, 20___ BETWEEN: [Insert Owner Name and Address] (the "Owner") AND: Town of Oliver 6150 Main Street PO Box 638 Oliver, BC V0H 1T4 (the “Town”) WHEREAS: A. The Town has, by the Bylaw, established a Revitalization Tax Exemption Program for the purpose of encouraging revitalization of certain areas of the municipality; B. The Owner is the registered owner, or the registered leaseholder of the Land, as defined in this Agreement; C. The Land is located in an area designated within the Bylaw as a revitalization area; D. The Owner has applied for a Tax Exemption under the Bylaw and a copy of the Application Form is attached to this Agreement, and the Owner has provided to the Town’s Chief Financial Officer all additional information required for the purposes of this Agreement, which additional information is also attached; E. This Agreement contains the terms and conditions respecting the issuance, by the Town, of an Exemption Certificate granting a partial municipal property tax exemption on the Land; and F. The Owner and the Town wish to enter into this Agreement. THIS AGREEMENT WITNESSES that in consideration of the mutual covenants and agreements contained in this Agreement (the receipt and sufficiency of which consideration the Town and the Owner hereby expressly acknowledge), the Town and Owner covenant and agree with each other as follows: Definitions 1. In this Agreement the following words have the following meanings: "Agreement" means this Agreement. "Bylaw" means "Revitalization Tax Exemption Bylaw 1328". ITEM I. - 2. Page 47 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule A Page 9 of 25 "Land" means [Insert complete legal description of the lands, including parcel identifier number]. Bylaw Definitions 2. Any terms not defined in this Agreement but defined in the Bylaw have the meanings given in the Bylaw. Term 3. This Agreement shall commence on the date of its full execution and if the Certificate is issued, this Agreement shall terminate: (1) if a Final Inspection and an Occupancy Permit [if applicable] for the Eligible Improvement are not obtained on or before [insert deadline date for completion] ; or (2) when the Exemption Certificate is issued. Revitalization Zone 4. The Owner has applied to the Town for a Tax Exemption in the following revitalization zone [check one]:  Downtown Commercial  Core Area Residential  Industrial  Airport Tax Exemption Certificate 5. If the Owner meets all of the following conditions, the Town will issue an Exemption Certificate, in form generally attached as a schedule to the Bylaw, for the applicable Tax Exemption in respect of the Land: (1) Construction or Alteration – The Owner must have constructed to a state of completion as evidenced by a Final Inspection and also by an Occupancy Permit, if applicable, issued by the Building Inspector, the following Eligible Improvement on the Land: [Insert project description here] (2) Completion of Work – All Work must be completed in accordance with the BC Building Code and applicable bylaws and servicing agreements with the Town, as well as any building permit or permit issued by the Town under Part 26 of the Local Government Act, including completion of all on-site and off-site landscaping or servicing Work that is required by any such bylaw, permit or servicing agreement. (3) Schedules – The Property must be developed in accordance with all applicable criteria set out in the Bylaw, including the Schedules to the Bylaw. (4) Utility Connections – The Owner must have paid to the Town the costs of all tie-ins of works and services associated with the Eligible Improvement to existing storm and sanitary sewers, water mains, water meters, driveways, and other municipal services. ITEM I. - 2. Page 48 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule A Page 10 of 25 (5) No Government Orders – The construction of the Eligible Improvement must not have been a response to an order of the Town or an order of another public authority. (6) No Change in Zoning – The Owner must not have applied to the Town during the term of this Agreement to change the zoning of the Land to some use other than the proposed use stated in the application. (7) Payment of Taxes – All property taxes, rates, fees, and other charges levied by the Town, including penalties and interest, on the Property and on other land owned by the Owner within Town must be paid. (8) Subdivision – The Owner must not have, during the term of this Agreement, subdivided the Land or any building on the Land, whether by conventional subdivision or in any other way, except for a strata subdivision creating a Strata Unit or a Restricted Strata Unit or stratifying a commercial, industrial or mixed-use building. (9) Compliance with Laws and Covenants – The Owner must have, during the term of this Agreement, used and occupied the Land in compliance with all enactments, regulations, and orders of any authority having jurisdiction and, without limiting the generality of the foregoing, all federal, provincial, or municipal laws, statutes, bylaws, licences, permits or approvals, including all the rules, regulations, policies, guidelines, criteria or the like made under any such laws and shall have complied with all land use covenants and land use agreements and charges registered against upon title of the Land. (10) Change of Ownership – The Owner must not have sold, assigned or otherwise transferred all or a portion of his or her equitable or legal interest in the Land during the term of this Agreement unless the transferee took an assignment of this Agreement, in a form satisfactory to the Town, and agreed to be bound by it. (11) Additional Site-Specific Terms – [List additional terms here] Entire Agreement 6. This Agreement constitutes the entire agreement between the Owner and the Town with regard to the subject matter hereof and supersedes all prior agreements, understandings, negotiations, and discussions, whether oral or written of the Town with the Owner. Further Assurances 7. The Owner shall, on the request of the Town, execute and deliver or cause to be executed and delivered, all such further transfers, agreements, documents, instruments, easements, deeds and assurances, and do and perform or cause to be done and performed, all such acts and things as may be, in the opinion of the Town, necessary to give full effect to the intent of this Agreement. No Town Representations 8. It is mutually understood, agreed and declared by and between the parties that the Town has made no representations, covenants, warranties, guarantees, promises, or agreements ITEM I. - 2. Page 49 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule A Page 11 of 25 (oral or otherwise), expressed or implied, with the Owner other than those expressly contained in this Agreement. Notices 9. All notices to be given under this Agreement must be in writing and may be delivered by hand or mailed by first-class prepaid registered mail to the address for the party at the top of this Agreement. Any notice delivered by hand is deemed to be given and received on the day it is sent. Any notice mailed is deemed to be given and received on the fourth day after it is posted (unless there is a mail strike, slow down or other labour dispute which might affect delivery, in which case the notice will be effective only if actually delivered). Notices must be addressed to the addresses on page 1 or to such other address as may from time to time be advised by a party in writing. Notices to the Town must be addressed to the attention of the "Corporate Officer". Powers Preserved 10. Nothing contained in or implied by this Agreement prejudices or affects the rights and powers of the Town in the exercise of its functions under any enactment or at common law, all of which may be fully and effectively exercised in relation to the Improvement and the Land. Relationship 11. Nothing in this Agreement is to be interpreted as creating an agency, partnership or joint venture between the Town and the Owner. Time 12. Time is of the essence in this Agreement. Remedies not Exclusive 13. No reference to or exercise of any specific right or remedy by the Town prejudices or precludes the Town from any other remedy, whether allowed at law or in equity or expressly provided for herein. Headings 14. The headings appearing in this Agreement have been inserted for reference and as a matter of convenience and in no way define, limit or enlarge the scope or meaning of this Agreement or any provision of it. Waiver 15. An alleged waiver of any breach of this Agreement is effective only if it is an express waiver in writing of the breach in respect of which the waiver is asserted. A waiver of a breach of this Agreement does not operate as a waiver of any other breach of this Agreement. ITEM I. - 2. Page 50 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule A Page 12 of 25 Interpretation 16. Wherever the singular or masculine or neuter is used in this Agreement, the same will be construed as meaning the plural, the feminine or body corporate where the context or the parties so require. Severance 17. If any section, subsection, clause or phrase of this Agreement is held to be invalid for any reason by a court of competent jurisdiction, the invalid portion shall be severed and the decision that it is invalid shall not affect the validity of the remainder of the Agreemen t. Enurement 18. This Agreement enures to the benefit of and is binding upon the parties and their respective successors and in the case of the Owner, its permitted assigns. Statutory References 19. A reference in this Agreement to a statute includes regulations made pursuant to it and includes all amendments and replacements to them from time to time. Modifications 20. No amendment or modification of any of the terms or provisions of this Agreement will be of any force or effect unless the amendment or modification is in writing and duly executed by the Town and the Owner. Governing Law 21. This Agreement will be governed by and interpreted in accordance with the laws of British Columbia. Joint and Several Liability 22. In circumstances where two or more persons comprise the Owner, those persons shall be jointly and severally liable for performance of the obligations of the Owner under this Agreement. Expense of Owner 23. The expense of performing the obligations and covenants of the Owner contained in this Agreement, and of all matters incidental to them, is solely that of the Owner. Owner's Representations and Warranties 24. The Owner represents and warrants to the Town that: (1) If the Owner is a corporation, all necessary corporate actions and proceedings have been taken by the Owner to authorize its entry into and performance of this Agreement; ITEM I. - 2. Page 51 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule A Page 13 of 25 (2) If the Owner is a corporation, the Owner has the corporate capacity and authority to enter into and perform this Agreement. (3) Upon execution and delivery on behalf of the Owner, this Agreement constitutes a valid and binding contractual obligation of the Owner; (4) Neither the execution and delivery, nor the performance, of this Agreement shall breach any other agreement or obligation, or cause the Owner to be in default of any other agreement or obligation, respecting to the Land; and As evidence of their agreement to be bound by the terms of this Agreement, the parties have executed this Agreement on the dates written below. DATED the __ day of ________, 20 __ ) ) Executed by the Town of Oliver ) by its authorized signatories: ) ) seal ) _____________________________ ) Mayor: ) ) _____________________________ ) Corporate Officer: ) DATED the ___ day of ________, 20__ ) ) (insert corporate name) ) by its authorized signatory(ies): ) seal ) ) ) ) ITEM I. - 2. Page 52 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule B Page 14 of 25 Schedule B: Form of Exemption Certificate This Tax Exemption Certificate is issued in accordance with: A. Revitalization Tax Exemption Bylaw 1328 (the "Bylaw"); B. The Revitalization Tax Exemption Program (the "Program") established by the Bylaw; and C. The Revitalization Tax Exemption Agreement dated for reference the ___ day of _________________, 20____ (the "Agreement") entered into between the Town of Oliver (the “Town”) and the: [select one]:  registered owner(s)  registered leaseholder(s) (the “Owner”) of those land(s) and improvements within the Town, legally described as: Parcel Identifier: _____________________ Legal Description: ________________________________________________________ ________________________________________________________________________ Property Tax Roll Number(s): _______________________________________________ Civic Address: ____________________________________________________________ (the “Land”) Whereas the Owner has constructed on the Land certain improvements described below, which qualify for a tax exemption under the Bylaw and under Section 226 of the Community Charter: [Identification of Eligible Improvements] ____________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ Now therefore, this Certificate certifies that the Land is subject to a revitalization tax exemption as follows: [Years and values are illustrative only and are to be amended or deleted as applicable.] The total term of Tax Exemption is ___ years, commencing in ______ and ending in _______. Table 1: Improvement Value Assessment Exemption Year Amount of Exemption 1 – 5 (2014-2018) Lesser of $1,000,000 or assessed improvement value 6 (2019) Lesser of $800,000 or assessed improvement value 7 (2020) Lesser of $600,000 or assessed improvement value 8 (2021) Lesser of $400,000 or assessed improvement value 9 (2022) Lesser of $200,000 or assessed improvement value 10 (2023) Lesser of $100,000 or assessed improvement value ITEM I. - 2. Page 53 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule B Page 15 of 25 Table 2: Land Value Assessment Exemption Year Amount of Exemption 1 – 5 (2014-2018) 35% of assessed value of land only 6 (2019) 30% of assessed value of land only 7 (2020) 25% of assessed value of land only 8 (2021) 20% of assessed value of land only 9 (2022) 15% of assessed value of land only 10 (2023) 10% of assessed value of land only Conditions of Tax Exemption 1. This Certificate is issued on the following conditions: (1) Compliance with Bylaw – The Land must strictly meet the criteria within the Bylaw, including its Schedules. (2) No Change in Zoning – The Owner must not apply to the Town during the term of the tax exemption to change the zoning of the Land to a category of use (residential / commercial / industrial) other than the category of use for which the tax exemption was granted. (3) Ongoing Occupancy / Business Operations - The Eligible Improvement must be continuously used for and only for a residential use or a commercial or an industrial business operation, whichever is applicable, during the term of the tax exemption. (4) Subdivision – The Owner must not have subdivided the Land or any building on the Land, whether by conventional subdivision or in any other way, except for a strata subdivision creating a Strata Unit or a Restricted Strata Unit or stratifying a commercial, industrial or mixed-use building. (5) Demolition / Destruction – If the Eligible Improvement is destroyed or demolished or otherwise removed, the tax exemption for improvements under this Bylaw, and the tax exemption for land (if applicable), shall cease until another Eligible Improvement has been reconstructed on the Land within the term of the tax exemption; however, the term of this Certificate will not be extended. (6) Compliance with Laws and Covenants – The Owner must during the term of the tax exemption use and occupy the Land in compliance with all enactments, regulations, and orders of any authority having jurisdiction and, without limiting the generality of the foregoing, all federal, provincial, or municipal laws, statutes, bylaws, licences, permits or approvals, including all the rules, regulations, policies, guidelines, criteria or the like made under any such laws and shall remain in compliance with all land use covenants and land use agreements and charges registered against upon title of the Land. (7) Business License – Where applicable, the Owner must at all times possess a valid business licence issued by the Town in respect of the business carried on at the Land. (8) Payment of Taxes - All property taxes, rates, fees, and other charges levied by the Town, including penalties and interest, on the Property (minus taxes exempted under the ITEM I. - 2. Page 54 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule B Page 16 of 25 Bylaw) and on other land owned by the Owner within the Town must be paid during the term of the tax exemption. Strata Subdivision 2. Where the Eligible Improvement is a strata lot or is subdivided into a strata lot under the Strata Property Act: (1) the tax exemption for improvements under this Bylaw for each strata lot will be granted such that the tax on improvements for that strata lot will be imposed on the assessed value of the improvements minus (the improvement value exemption shown in Table 1 apportioned in accordance with the unit entitlement of the strata lot), and (2) the tax exemption for land under this Bylaw [if applicable] for each strata lot will be granted such that the tax on land for that strata lot will be imposed on the assessed value of the land minus the land value exemption shown in Table 2. Cancellation of Certificate 3. This Certificate may be cancelled by the Council of Oliver: (1) on the request of the Owner; or (2) if any of the conditions in this Certificate are not met. Partial Recapture of Exempted Taxes 4. If the Land ceases to meet all the conditions of this Certificate, then this Certificate shall be cancelled and all tax exempted commencing in the calendar year in which the conditions under this Certificate were not met shall be calculated by the Designated Of ficer and shall become a debt immediately payable by the Owner at that time to the Town and must be repaid by the Owner at that time. Interest shall be calculated on the outstanding amount, from the date the conditions of this Certificate were not met, at the rate set by the Province for arrears of taxes, compounded monthly and shall continue to accrue until the debt is paid in full. No Refund 5. For clarity, under no circumstances will the Owner be entitled under the Program to any cash credit, any carry forward tax exemption credit or any refund for any property taxes paid. DATED the ___ day of _________ , 20 ___ Town of Oliver by its authorized signatory: __________________________________ Chief Financial Officer ITEM I. - 2. Page 55 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule C Page 17 of 25 Schedule C: Downtown Commercial Revitalization Zone 1. The Downtown Commercial Revitalization Zone is comprised of the shaded area, outlined in dashed lines, illustrated below: ITEM I. - 2. Page 56 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule C Page 18 of 25 2. The specific objectives of the Downtown Commercial Revitalization Zone are: (1) To encourage commercial development of existing vacant properties in the historic downtown core area of Oliver; (2) To encourage introduction of new commercial activities and new commercial buildings and to sustain existing commercial activities by encouraging revitalization of existing buildings in the downtown core area; (3) To enhance the livability and vibrancy of the downtown area by encouraging construction of new residential dwelling units above commercial developments in the downtown core area; (4) To enhance the aesthetic appearance of the downtown core area by encouraging renovation to the facades and other exterior components of buildings in the area. 3. The following tax exemptions apply in the Downtown Commercial Revitalization Zone: (1) New Construction and Expansion – For new commercial construction on vacant lots and for expansion of existing commercial buildings, including construction of residential dwelling units above the ground floor of a commercial building, a tax exemption for improvements only will be granted such that the tax on improvements will be imposed on the assessed value of the improvements minus Construction Value. (2) Interior Renovations and Façade Improvements – For interior renovations in excess of $100,000 Construction Value and for external renovations or facade improvements in excess of $100,000 Construction Value, a tax exemption for improvements only will be granted such that the tax on improvements will be imposed on the assessed value of the improvements minus Construction Value. 4. The above tax exemptions shall be provided for the following terms: (1) For an Eligible Hotel Development built under section 3(1) of this Schedule, the tax exemption shall be granted for 10 years. (2) For all other qualifying construction under section 3(1) of this Schedule, the full tax exemption shall be granted for 5 years, then reduced such that references to Construction Value are reduced to the following amounts: (a) Year 6 – 80% of Construction Value (b) Year 7 – 60% of Construction Value (c) Year 8 – 40% of Construction Value (d) Year 9 – 20% of Construction Value (e) Year 10 – 10% of Construction Value. (3) For qualifying construction under subsection 3(2) the tax exemption shall be granted for 5 years only. ITEM I. - 2. Page 57 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule D Page 19 of 25 Schedule D: Core Area Residential Revitalization Zone 1. The Core Area Residential Revitalization Zone is comprised of the shaded area, outlined in dashed lines, illustrated below: ITEM I. - 2. Page 58 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule D Page 20 of 25 2. The specific objectives of the Core Area Residential Revitalization Zone are: (1) To enhance the livability and vibrancy of the downtown area by encouraging construction of new multi-family residential dwelling units in the downtown core area; (2) To encourage realization of the medium to high-density residential designation of this area in the Official Community Plan; (3) To create a residential base within walking distance from the downtown commercial area thus encouraging the evolution of a walkable downtown area in accordance with smart growth principles; and (4) To encourage creation of rental and co-op housing opportunities. 3. The following tax exemptions apply in the Core Area Residential Revitalization Zone: (1) New Construction (a) For construction of a new Eligible Housing Development that is an Apartment Building or a Co-op containing not less than four dwelling units and being not less than two stories high on an existing land parcel, a tax exemption for imp rovements only will be granted such that the tax on improvements will be imposed on the assessed value of the improvements minus Construction Value. (b) For construction of a new building containing not less than four Strata Units or Restricted Strata Units and being not less than two stories high on an existing parcel, a tax exemption for each Strata Unit or the Restricted Strata Unit, as applicable, will be granted such that the tax on improvements will be imposed on the assessed value of the improvements minus (total Construction Value apportioned in accordance with the unit entitlement of each Strata Unit or Restricted Strata Unit, as applicable). (2) Assembly Parcels (a) For construction of a new Eligible Housing Development that is an Apartment Building or a Co-op containing not less than four dwelling units and being not less than two stories high on land made up of former lots that were assembled and/or consolidated for the purpose of the development, (i) a tax exemption for improvements only will be granted such that the tax on improvements will be imposed on the assessed value of the improvements minus Construction Value; and (ii) a tax exemption on the land will be granted such that the tax on land will be imposed on the assessed value of the land minus 35% of the assessed value of the land. (b) For construction of a new building containing not less than four Strata Units or Restricted Strata Units and being not less than two stories high on land made up of former lots that were assembled and/or consolidated for the p urpose of the development, ITEM I. - 2. Page 59 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule D Page 21 of 25 (i) a tax exemption for the Strata Unit or the Restricted Strata Unit, as applicable, will be granted such that the tax on improvements will be imposed on the assessed value of the improvements minus (total Construction Value apportioned in accordance with the unit entitlement of the Strata Unit or Restricted Strata Unit, as applicable); and (ii) a tax exemption on the land of each Strata Unit or Restricted Strata Unit, as applicable, will be granted such that the tax on land will be imposed on the assessed value of the land minus 35% of the assessed value of the land. 4. The above tax exemptions shall be provided for the following terms: (1) For Strata Units, the above exemptions will be granted for 5 years only. (2) For Restricted Strata Units and other Eligible Housing Developments, the above exemptions will be granted for 5 years, then reduced such that references to Construction Value and to 35% of assessed value of land are reduced to the following amounts: (a) Year 6 – 80% of Construction Value and 30% of assessed value of land, where applicable (b) Year 7 – 60% of Construction Value and 25% of assessed value of land, where applicable (c) Year 8 – 40% of Construction Value and 20% of assessed value of land, where applicable (d) Year 9 – 20% of Construction Value and 15% of assessed value of land, where applicable (e) Year 10 – 10% of Construction Value and 10% of assessed value of land, where applicable. ITEM I. - 2. Page 60 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule E Page 22 of 25 Schedule E: Industrial Revitalization Zone 1. The Industrial Revitalization Zone is comprised of the shaded area, outlined in dashed lines, illustrated below: ITEM I. - 2. Page 61 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule E Page 23 of 25 2. The specific objectives of the Industrial Revitalization Zone are: (1) To create employment opportunities by encouraging industrial and commercial development in the established industrial areas of Oliver; (2) To encourage introduction of new industrial and commercial buildings and activities and to sustain existing industrial and commercial activities by encouraging revitalization of existing buildings in industrial zones. 3. Subject to section 5 and section 6 of this Schedule, the following tax exemptions are provided in the Industrial Revitalization Zone: (1) New Construction and Expansion – For new construction or expansion of existing industrial and commercial buildings with a Construction Value of $250,000 or more, a tax exemption for improvements only will be granted such that the tax on improvements will be imposed on the assessed value of the improvements minus Construction Value. (2) Renovations – For renovations in excess of $250,000 Construction Value, a tax exemption for improvements only will be granted such that the tax on improvements will be imposed on the assessed value of the improvements minus Construction Value. 4. The above tax exemptions shall be provided for the following terms: (1) For qualifying construction under subsections 3(1) the full tax exemption shall be granted for 5 years, then reduced such that references to Construction Value are reduced to the following amounts: (a) Year 6 – 80% of Construction Value (b) Year 7 – 60% of Construction Value (c) Year 8 – 40% of Construction Value (d) Year 9 – 20% of Construction Value (e) Year 10 – 10% of Construction Value. (2) For qualifying construction under subsection 3(2) the tax exemption shall be granted for 5 years only. 5. Notwithstanding Section 3 of this Schedule, no tax exemption will be granted or continued where the principal use of the Property is or becomes one or both of the following: (1) Indoor or outdoor storage facilities (2) Vehicle recycling facilities. 6. Notwithstanding anything else in the Bylaw or this Schedule, if the assessment class of the Property for any reason ceases to be Class 4 – Major Industry, Class 5 – Light Industry or Class 6 – Business and Other, the Property is not eligible for a tax exemption under this Bylaw and any existing tax exemption under this Bylaw ceases at the time of the change in assessment class. ITEM I. - 2. Page 62 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule F Page 24 of 25 Schedule F: Airport Revitalization Zone 1. The Airport Revitalization Zone is comprised of the Oliver Airport located in the shaded area, and outlined in dashed lines, illustrated below: ITEM I. - 2. Page 63 of 143 Revitalization Tax Exemption Bylaw 1328 – Schedule F Page 25 of 25 2. The specific objectives of the Airport Revitalization Zone are: (1) To create aviation-related employment opportunities by encouraging commercial and industrial development on the Oliver Airport; and (2) To enhance the financial viability of the Oliver Airport by fostering lease revenues from new commercial and industrial developments on the airport. 3. Subject to section 5 of this Schedule, the following tax exemptions are provided in the Airport Revitalization Zone: (1) New Construction – For new industrial or commercial construction on vacant land, a tax exemption for improvements only will be granted such that the tax on improvements will be imposed on the assessed value of the improvements minus Construction Value. (2) Expansion – For expansion of existing industrial and commercial operations in excess of $250,000 Construction Value, a tax exemption for improvements only will be granted such that the tax on improvements will be imposed on the assessed value of the improvements minus Construction Value. 4. The above tax exemptions shall be granted for 5 years, then reduced such that references to Construction Value are reduced to the following amounts: (1) Year 6 – 80% of Construction Value (2) Year 7 – 60% of Construction Value (3) Year 8 – 40% of Construction Value (4) Year 9 – 20% of Construction Value (5) Year 10 – 10% of Construction Value. 5. Notwithstanding Section 3 of this Schedule, no tax exemption will be granted or continued where the principal use of the Property is or becomes general aviation hangars for storage of non-commercial aircraft. ITEM I. - 2. Page 64 of 143 ITEM I. - 3. Page 65 of 143 ITEM I. - 3. Page 66 of 143 ITEM I. - 3. Page 67 of 143 ITEM I. - 3. 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Page 83 of 143 Page 84 of 143 Town of Oliver STAFF REPORT Report to Regular Council Meeting of March 25 2013 From Tom Szalay Municipal Manager Date March 18 2013 Subject Gas Tax Grants Contribution Agreements Action Recommendation File 10 PURPOSE This report seeks council authorization to execute contribution agreements for the follow ing two water projects under the Government of Canada Gas Tax Revenue Transfer pro grams Buchanan Road Domestic Water Well Expansion and Rural Water Twinning Completion 20 RECOMMENDATIONS It is recommended A That the signing officers of the Town be authorized to execute the funding agreement for the Buchanan Road Water Supply Well Project approved under the Federal Gas Tax Regionally Significant Projects Fund to receive funding not to exceed 100 of project costs or 409800 and B That the signing officers of the Town be authorized to execute the funding agreement for the Oliver Rural Water System Twinning Phase 3 Project approved under the Federal Gas Tax Strategic Priorities and Innovation Funds to receive funding not to exceed 100 of project costs or 1243000 Tom Szalay P Municipal Mar WFinanceGrants2011 Regionally Significant Gas Taxcouncilrpt tsgas tax agreements buchanan phase 3 twinningdocx ITEM J. - 2. Page 85 of 143 March 18 2013 Gas Tax Grants Contribution Agreements Page 2 30 BACKGROUND In recent months following adjudication of grant applications by the UBCM funding approval has been announced for the following three Oliver area water capital projects under the Govern ment of Canadas gas tax revenue transfer programs Buchanan Road DomesticWater Well ExpansionGUDITreatmentUpgrades Rural Water Twinning Completion A finding agreement for the GUDI project was signed in December 2012 Draft funding agree ments have now been received from UBCM for the Buchanan Road Well and the Rural Water Twinning projects These agreements attached to this report as Appendix 1 and Appendix 2 re spectively must be executed by the Town prior to receiving any funding A brief summary of the projects and the approved levels of funding isprovided below 31 Buchanan Road Domestic Water Well Expansion The existing Buchanan Road Water Well was inherited from the Southern Okanagan Lands Irri gation District SOLID upon its dissolution in 1989 In the past this well has supplied domes tic water flows north of Oliver in winter months and augmented irrigation flows in summer months An expansion of this facility is proposed in order to Provide domestic water all year round to the newly twinned rural water system north of Oliver Augment Oliversintown watersupply following changes to the Canadian Drinking Water Quality Guidelines which have virtually removed two wells in Lions Park from the grid because of measured uranium concentrations and Provide back up capacity during peak demand times and for future growth The Buchanan Road project consists of drilling a second well adjacent to the existing facility erecting a pump house building over the new well installing pumping controls chlorination and SCADA equipment and connecting the well to existing water mains including a drilled pipeline under the Okana gan River The total project cost estimate is 683000 Approved grant funding is capped at 409800 which is approximately 60 of the projected cost It is noteworthy that unlike previous infra structure grant programs the total funding is capped but the percentage share is not As a result the Town will receive full funding if the project costs exceed the approved grant amount and any cost savings between 409800 and 683000 will be retained by the Town 1 GUDI Groundwater Under Direct Influence of surface water ITEM J. - 2. Page 86 of 143 March 18 2013 Gas Tax Grants Contribution Agreements Page 3 The project start and end dates in the contribution agreement are defined as January 1 2012 and March 31 2015 This long time frame is to ensure that tenure can be obtained in time from the Province over the land where the new well is to be located This is necessary because soon after proposing the project it was discovered that the land at the existing well site was never secured from the Province by SOLID when the well was first installed 32 Rural Water Twinning Completion Most of the rural water distribution system installed by SOLID over 40 years ago relied on a single pipeline network delivering both irrigation and domestic water supplies Because the sys tems groundwater wells do not have the capacity to meet summer irrigation demands most of this pipe network has been charged with river water during the irrigation season for both irriga tion and domestic use As a result many customers complained about water turbidity and odours during summer months More importantly river water used in the shared system received only minimal treatment chlorination which alone does not meet current health and safety expecta tions or standards for disinfection Rather than fully treating the high volume of irrigation water to domestic standards it was de termined more cost effective to install a parallel domestic pipeline system in the rural areas to provide groundwater for domestic use by all customers all year long Work on the rural twinning project began in 2006 following considerable design and funding effort The initial cost sharing for this project under the BC Rural Water Improvement Fund was for Phase 1 only based on a three phase approach Phase 2 funding was approved under the Canada BC Infrastructure program in 2008 Phase 3 will complete this project connecting the final 55 more or less customers to the system at the north end of the Towns water distribution network The total cost for this phase is esti mated at 1864000Grant funding is capped at 1243000or approximately 67 of the pro ject budget As with the Buchanan Road Well funding described earlier in this report the total funding is capped but the percentage share is not As a result the Town will receive full funding if the project costs exceed the approved grant amount and any cost savings between 1243000 and 1864000 will be retained by the Town ITEM J. - 2. Page 87 of 143 Page 1 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] REGIONALLY SIGNIFICANT PROJECT, TIER 1 AND 2 STRATEGIC PRIORITIES FUND AND/OR INNOVATIONS FUND FUNDING AGREEMENT UNDER THE AGREEMENT ON THE TRANSFER OF FEDERAL GAS TAX REVENUES FOR THE Buchanan Road Water Supply Well PROJECT This Agreement made as of ________________________, 2013, BETWEEN: TOWN OF OLIVER (the Recipient) AND: The UNION OF BRITISH COLUMBIA MUNICIPALITIES as continued by section 2 of the Union of British Columbia Municipalities Act SBC 2006, c.18. WHEREAS: A. Her Majesty the Queen in Right of Canada (Canada), Her Majesty the Queen in Right of the Province of British Columbia (British Columbia) and the Union of British Columbia Municipalities (UBCM) entered into the Agreement on the Transfer of Federal Gas Tax Revenues (Gas Tax Agreement) on September 19, 2005. B. The Gas Tax Agreement provides for a Tier 1 and 2 Strategic Priorities Fund and an Innovations Fund. C. The Partnership Committee has determined that a portion of the Tier 1 and 2 Strategic Priorities Fund be set aside and made available for Tier 2 regions for Regionally Significant Projects and that the remainder will be known as General Strategic Priorities Fund (GSPF). D. The Management Committee has approved funding of the Eligible Projects set out in Schedule B from the Innovations Fund, the General Strategic Priorities Fund, and/or the funding set aside for Regionally Significant Projects. E. The Gas Tax Agreement requires that the UBCM enter into a Funding Agreement with each Eligible Recipient prior to the transfer of Gas Tax Funds from the UBCM to the Eligible Recipient and to enforce all terms and conditions of that Agreement. NOW THEREFORE, in consideration of the mutual promises herein, the Recipient and the UBCM agree as follows: 1. INTERPRETATION 1.1 Definitions A capitalized term has the meaning given to it in this section or in section 1.1 of the Gas Tax Agreement, unless the context clearly dictates otherwise. If there is a conflict between the meaning of a term in this section and section 1.1 of the Gas Tax Agreement, the meaning in this section will prevail. “Agreement” means this agreement between the Recipient and the UBCM. ITEM J. - 2. Page 88 of 143 Page 2 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] “Chief Financial Officer” means the officer assigned financial administration responsibility under section 149 of the Community Charter. “Eligible Costs” means those costs described in Schedule A, incurred in respect of Eligible Projects. “Eligible Project” means an Environmentally Sustainable Municipal Infrastructure Project or a Capacity Building Project specifically described in Schedule B. “Eligible Recipient” has the same meaning as in the Gas Tax Agreement. “Environmentally Sustainable Municipal Infrastructure Project” means a project that results in a tangible capital asset in British Columbia primarily for public use or benefit and owned by an Eligible Recipient that: (i) improves the quality of the environment and contributes to reduced greenhouse gas emissions, clean water, or clean air, and (ii) falls within the category of projects described in Schedule A to the Gas Tax Agreement. “Funds” means the funds made available pursuant to this Agreement and includes any interest on the said Funds. “Gas Tax Agreement” means the Canada – British Columbia – UBCM Agreement on the Transfer of Federal Gas Tax Revenues made as of September 19, 2005, as amended from time to time. “Infrastructure Programs” means Canada’s infrastructure programs in existence at the time of the execution of the Gas Tax Agreement, including the Canada Strategic Infrastructure Fund, the Border Infrastructure Fund, the Municipal Rural Infrastructure Fund and the Infrastructure Canada Program. “Management Committee” means the management committee established under the Gas Tax Agreement. “Partnership Committee” means the Partnership Committee established under the Gas Tax Agreement. “Party” means the Recipient or the UBCM. “Third Party” means any person, other than a Party to this Agreement, that participates in the implementation of an Eligible Project. 1.2 Schedules The following schedules are attached to and form part of this Agreement: Schedule A – Eligible and Ineligible Costs Schedule B – Eligible Projects ITEM J. - 2. Page 89 of 143 Page 3 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] 1.3 Accounting Principles All accounting terms not otherwise defined therein have the meanings assigned to them under the generally accepted accounting principles (GAAP); all calculations will be made and all financial data to be submitted will be prepared in accordance with the GAAP in effect in Canada and in British Columbia. GAAP will include, without limitation, those principles approved or recommended from time to time by the Canadian Institute of Chartered Accountants, or any successor institute, applied on a consistent basis. 2. CONTRIBUTION PROVISIONS AND PAYMENTS TO RECIPIENTS 2.1 Maximum Payment (a) UBCM will make a financial contribution from the Regionally Significant Projects Fund (RSP) to the Recipient for the Buchanan Road Water Supply Well as described in Schedule B, that will not exceed the lesser of 100% of the Eligible Costs of that Eligible Project and $409,800.00. (b) The Recipient acknowledges that Eligible Costs are limited to net costs to the Recipient, that is, net of other grants and other external contributions. The Recipient acknowledges that any otherwise Eligible Costs that have received funding from any other federal, provincial or Third Party source will not be reimbursed under this Agreement, and the Recipient agrees to promptly notify UBCM in writing of any such funding received. (c) Any amount paid to the Recipient under this Agreement in excess of the maximum contribution set out in paragraph (a), must be repaid by the Recipient to UBCM. 2.2 Other Federal Funding The Recipient acknowledges that it may use Funds to pay up to 100% of Eligible Costs of an Eligible Project, provided that to the extent it is receiving money under an Infrastructure Program in respect of an Eligible Project, the maximum federal contribution limitation set out in any Infrastructure Program contribution agreement made in respect of an Eligible Project shall continue to apply and Funds paid to the Recipient for Eligible Costs of the Eligible Project shall be deemed to be a federal contribution under the said contribution agreement. 2.3 Payments of Funds to the Recipient (a) Subject to paragraphs (d) and (e), and provided the Recipient is not in default of this Agreement, the UBCM will pay an amount validly claimed by the Recipient under paragraph (b) or (c) within 30 days of the verification of that claim. (b) Recipients may submit, on the form supplied by the UBCM, a claim or claims for payment of the contribution amount specified under section 2.1(a) at any time between the Commencement Date and six months after the Completion Date, but may only submit one claim for each Eligible Project each calendar quarter. (c) In order to be validly included in a claim for payment, amounts must: (i) be Eligible Costs of an Eligible Project identified in Schedule B, (ii) be paid by the Recipient prior to the date of the claim, ITEM J. - 2. Page 90 of 143 Page 4 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] (iii) not be subject to reimbursement to the Recipient through any other grant, rebate or external contribution program or arrangement, (iv) not be included in a previous claim for payment under this Agreement, and (v) when added to amounts included in all previous claims for payment under this Agreement, be less than the maximum contribution amount set out for that Eligible Project in section 2.1(a), or, if the claim is made prior to the completion of the project, 85% of that amount. (d) The UBCM may not pay a claim of the Recipient if the Recipient was required to file an annual report under any Gas Tax Funding Agreement and that report has not been filed. (e) The UBCM is not required to pay a claim of the Recipient if Funds received by UBCM from Canada under the Gas Tax Agreement are insufficient to make the payment. 2.4 Repayment Provisions Whenever the Recipient is obliged to pay monies to the UBCM, under section 3.4(c) or 2.1(c) or any other provision of this Agreement: (a) it shall forthwith provide to the UBCM the required payment together with a full accounting, certified under the Chief Financial Officer’s signature, of what monies the Recipient believes are owing to the UBCM, and the circumstances giving rise to the obligation to pay; (b) the Recipient shall, at the request of the UBCM, make available to the UBCM and its auditors all accounts and records and documents relating to the repayment; and (c) the repayment shall constitute a debt to the UBCM and, unless repaid by the Recipient to UBCM, the UBCM may take steps to recover the unspent Funds, including deducting the debt from amount otherwise owing to the Recipient under this or another Gas Tax Agreement Funding Agreement. 3. COMMITMENTS AND ACKNOWLEDGEMENTS OF THE RECIPIENT 3.1 Eligible Project Approved for Funding and Changes to that Project (a) The Eligible Project approved for funding is as described in Schedule B and funding under this Agreement is subject to completion of that Eligible Project. Funding under this Agreement will not be made available to the Recipient for an Eligible Project where the scope or Eligible Costs of the Eligible Project are different than that described in Schedule B, unless the Recipient has obtained prior written approval for the change from the Management Committee. (b) Management Committee shall not consider cost overruns on Eligible Projects other than in exceptional circumstances where: (i) the Recipient informs the Management Committee as soon as it becomes aware that a cost overrun is probable; (ii) the Management Committee approves the inclusion of the cost overrun as justifiable; and (iii) Funds are available to cover the cost overrun. ITEM J. - 2. Page 91 of 143 Page 5 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] 3.2 Requirement to Commence and Complete Project (a) The Recipient will implement the Eligible Project in a diligent and timely manner, and has commenced or will commence carrying out the Eligible Project on or about January 1, 2012, or a later date approved in advance by the Management Committee, (the Commencement Date) and will complete the Eligible Project no later than March 31, 2015, or a later date approved in advance by the Management Committee (the Completion Date). (b) Upon request by UBCM, the Recipient will provide evidence to UBCM that the Recipient has commenced the Eligible Project. (c) If, after the Commencement Date, and in the judgment of the Management Committee, the Recipient fails to demonstrate that the Eligible Project has commenced, this Agreement may be terminated at the option of the Management Committee, effective immediately. 3.3 Undertaking the Eligible Project The Recipient will: (a) award and manage all contracts for the supply of services and/or materials to the Eligible Project in accordance with the Recipient's relevant policies and procedures; (b) award contracts for the supply of services and/or materials to the Eligible Projects in a manner that is transparent, competitive, and consistent with value for money principles; (c) comply with all legislated environmental assessment requirements and agree that no Funds will be committed to an Eligible Project until all required environmental assessment requirements have been satisfied; and (d) implement any mitigation measures identified in any environmental assessment of the Eligible Project. 3.4 Provisions relating specifically to Eligible Projects that are Environmentally Sustainable Municipal Infrastructure Projects The Recipient agrees that: (a) in order to ensure completion of the Eligible Project as identified in this Agreement, the Eligible Project is subject to site visits at any time during construction and for a period of three years after its completion, and for this purpose, the Recipient will permit any member of the Management Committee, or its designate, at any reasonable time, to have access to the Eligible Project site; (b) upon completion of the Eligible Project, the Recipient or any other party to whom is assigned the ongoing responsibility for the Eligible Project shall take over full responsibility for the Eligible Project’s operation, maintenance and repair; (c) except as provided for in paragraph (d), if, at any time within ten years from the date of completion of an Eligible Project, an Eligible Recipient sells, leases, encumbers or otherwise disposes of, directly or indirectly, any asset constructed, rehabilitated or improved, in whole or in part, with Funds made available under ITEM J. - 2. Page 92 of 143 Page 6 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] this Agreement, the Recipient shall repay the UBCM, on demand, a proportionate amount of the funds contributed by Canada, as follows: Where Eligible Project asset is sold, leased, encumbered or disposed of: Repayment of contribution (in current dollars) Within 2 years after Eligible Project completion 100% Between 2 and 5 years after Eligible Project completion 55% Between 5 and 10 years after Eligible Project completion 10% Rolling stock up to 10 years old At book value depreciated according to GAAP (d) the repayment provision under paragraph (c) does not apply if the asset disposal is to Canada, British Columbia, a Local Government or a Crown corporation of British Columbia that is the latter’s agent for the purposes of implementing this Funding Agreement or to another Eligible Recipient; and (e) it will notify the UBCM in writing as soon as practicable of any transaction triggering the above mentioned repayment. 3.5 Communications The Recipient will ensure that: (a) all communications referring to projects funded under this Agreement clearly recognize Canada’s investment and use the Canada word mark and a tagline; (b) permanent signage is placed in the location of projects funded under this Agreement, prominently identifying Canada’s investment and including the Canada word mark. Where there is no fixed location for signage, such as a transit vehicle, a prominent marker will recognize Canada’s contribution. All signage/plaques will be located in such a way as to be clearly visible to users, visitors and/or passersby; (c) a minimum of 21 days notice of an event or announcement in relation to a project funded under this Agreement is given to Canada, British Columbia and UBCM, in order that all orders of government may plan their involvement; (d) Canada, British Columbia and UBCM will each receive appropriate recognition in joint communications materials; and (e) joint communications material and signage will reflect Canada’s communications policy, including the Official Languages Act, and federal-provincial identity graphics guidelines. Costs related to announcement and signage in the French language will be the responsibility of Canada. 3.6 Record Keeping, Reporting, and Audit The Recipient will: (a) maintain proper and accurate accounts and records, including invoices, statements, receipts and vouchers in respect of all Eligible Projects that receive Funds and ensure that such records are kept for at least three years after termination of this Agreement and, upon reasonable notice, make them available to Canada or UBCM; (b) permit an audit of an Eligible Project and fully cooperate with any auditor retained by the UBCM for such purpose; and ITEM J. - 2. Page 93 of 143 Page 7 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] (c) provide to the UBCM, no later than July 1 of each year, a written report clearly setting out the following information for the previous fiscal year, and cumulatively from the date of this Agreement: (i) the amount received from UBCM under this Agreement; (ii) the aggregate amount of Funds paid for Eligible Costs of Eligible Projects under this Agreement; (iii) the amount, if any, held at year end to be paid for Eligible Costs of Eligible Projects under this Agreement; (iv) for each Eligible Project: (A) the location; (B) the investment category; (C) the amount and identity of all sources of funding; (D) the progress made towards its completion; (E) the nature of the investment; (F) the outcomes and outputs expected and achieved, stated in accordance with the indictors established by the Partnership Committee and provided in writing to the Recipient by UBCM; and (v) a declaration from the Chief Financial Officer that to the best of that officer’s knowledge: (A) all funds paid under this Agreement have been expended for Eligible Costs of Eligible Projects; (B) each Eligible Project funded will result in net incremental spending on infrastructure in accordance with the methodology for measuring incrementality approved by the Partnership Committee; and (C) the Recipient’s financial statements were prepared following accounting rules of the Public Sector Accounting Board; and (d) if requested, provide to UBCM additional information that may be required in order for UBCM to fulfill its reporting, audit and evaluation requirements under the Gas Tax Agreement, including information with respect to use of Funds, incremental spending, Eligible Projects, outputs and outcomes of the investment, and related communications activities. 3.7 Indemnity The Recipient will indemnify and save harmless Canada and the UBCM, their officers, servants, employees or agents from and against all claims and demands, losses, costs, damages, actions, suits or other proceedings by whomsoever brought or prosecuted in any manner based upon, or occasioned by, any injury to persons, damage to or loss or destruction of property, economic loss or infringement of rights caused by or arising directly or indirectly from: (a) all Eligible Projects; (b) the performance of this Agreement or the breach of any term or condition of this Agreement by the Recipient, its officers, employees, and agents, or by a Third Party and any of its officer, employees, servants or agents; (c) the design, construction, operation, maintenance and repair of any part of an Eligible Project; and ITEM J. - 2. Page 94 of 143 Page 8 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] (d) any omission or other willful or negligent act of the Recipient or Third Party and their respective employees, officers, servants or agents; except to the extent to which such claims and demands, losses, costs, damages, actions, suits or other proceedings relate to an act of negligence of an officer, employee or agent of Canada or UBCM in the performance of his or her duties. 4. DISPUTE RESOLUTION, DEFAULT AND REMEDIES 4.1 Dispute Resolution (a) The UBCM and the Recipient are committed to working together and making all efforts to reach agreement on fulfillment of the terms and conditions of this Agreement and the UBCM’s obligations to Canada and British Columbia under the Gas Tax Agreement. This includes early and ongoing communications and information sharing. (b) In the event of an unresolved dispute between the two parties regarding the terms and conditions of this Agreement, either party may refer the dispute to the dispute resolution process to be the developed by the Partnership Committee. 4.2 Default and Remedies (a) If the Recipient fails to observe or comply with any of the terms or conditions set out in this Agreement, the UBCM, upon recommendation of the Management Committee, may, at its discretion exercisable by written notice to the Recipient, reduce, suspend or terminate any further payment. (b) On receipt of a default notice under this section, the Recipient must, within 30 days of receipt of such notice, remedy the default, or demonstrate to the satisfaction of the UBCM that it has taken sufficient actions as necessary to commence curing the default or must proceed to dispute resolution. (c) If and so long as the Recipient remains in default of this Agreement after notice, pursuant to this section has been given, the UBCM’s obligation to make any further payments pursuant to section 2.3 of this Agreement are suspended. 5. MISCELLANEOUS 5.1 Term This Agreement shall commence of the date that it is fully executed by both of the Parties and shall expire on March 31, 2015. 5.2 Binding Obligations Each party declares to the other that the signing and execution of this Agreement was duly and validly authorized, and that each party has incurred a legal and valid obligation in accordance with the terms and conditions of this Agreement. ITEM J. - 2. Page 95 of 143 Page 9 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] 5.3 Survival The rights and obligations, set out in Sections 2.3, 2.4, 3.2, 3.4, 3.5, 3.6 and 3.7 will survive the expiry or early termination of this Agreement and any other section which is required to give effect to the termination or to its consequences shall survive the termination or early termination of this Agreement. 5.4 Governing law This Agreement is governed by the laws applicable in British Columbia. 5.5 No Agency It is understood, recognized and agreed that no provision of this Agreement and no action by the Parties will establish or be deemed to establish a partnership, joint venture, principal-agent relationship or employer-employee relationship in any way or for any purpose whatsoever between the UBCM and the Recipient, or between the UBCM, the Recipient and a Third Party. 5.6 No Authority to Represent Nothing in this Agreement is to be construed as authorizing one Party to contract for or to incur any obligation on behalf of any other Party or to act as agent for any other Party. Nothing in this Agreement is to be construed as authorizing any Eligible Recipient or any Third Party to contract for or to incur any obligation on behalf of Canada, British Columbia or UBCM or to act as agent for Canada, British Columbia or UBCM. 5.7 Counterpart Signature This Agreement may be signed in counterpart, and the signed copies will, when attached, constitute an original Agreement. 5.8 Values and Ethics Code No person governed by the post-employment, ethics and conflict of interest guidelines of Canada will derive a direct benefit from this Agreement unless that person complies with the applicable provisions. 5.9 Severability If for any reason a provision of this Agreement that is not a fundamental term is found to be or becomes invalid or unenforceable, in whole or in part, it will be deemed to be severable and will be deleted from this Agreement, but all the other terms and conditions of this Agreement will continue to be valid and enforceable. 5.10 No Assignment This Agreement is not assignable by the Recipient and the Recipient shall not assign, pledge, or otherwise transfer any entitlement to Funds under this Agreement to any person and shall upon receipt of Funds hereunder pay and expend such Funds thereafter only in accordance with the terms and conditions of this Agreement. ITEM J. - 2. Page 96 of 143 Page 10 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] 5.11 Joint Projects Despite section 5.10, where the tangible capital asset resulting from the Eligible Project is, or will be, owned in whole or in part by an Eligible Recipient other than the Recipient, the Recipient may, upon prior written approval of the Management Committee, assign the obligations under this Agreement in relation to that Eligible Project to the owner of the asset. 5.12 Waiver A Party may waive any right under this Agreement only in writing; and any tolerance or indulgence demonstrated by that Party will not constitute waiver of such right. Unless a waiver is executed in writing, that Party will be entitled to seek any remedy that it may have under this Agreement or under the law. 5.13 Amendments This Agreement may be amended from time to time on written agreement of the Parties. 5.14 Notice Any notice, information, or document provided for under this Agreement will be effectively given if delivered or sent by letter, postage or other charges prepaid, or by facsimile or email. Any notice that is delivered will have been received on delivery; and any notice mailed will be deemed to have been received eight calendar days after being mailed. Any notice, information or document sent by facsimile or email will be deemed validly received when so transmitted. Any notice to the UBCM will be addressed to: Executive Director Union of British Columbia Municipalities 60 – 10551 Shellbridge Way Richmond, British Columbia V6X 2W9 Facsimile: 604-270-9116 Email: ubcm@ubcm.ca Any notice to the Recipient will be addressed to: The Corporate Officer at the place designated as the local government office. Each Party may change the contact information that it has stipulated by notifying in writing the other Parties of the new contact information. ITEM J. - 2. Page 97 of 143 Page 11 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] SIGNATURES This Agreement has been executed on behalf of the Recipient and the Union of British Columbia Municipalities by those officers indicated below and each person signing the agreement represents and warrants that they are duly authorized and have the legal capacity to execute the agreement. TOWN OF OLIVER UNION OF BRITISH COLUMBIA MUNICIPALITIES Mayor Corporate Officer UBCM Corporate Officer General Manager Victoria Operations ITEM J. - 2. Page 98 of 143 Page 12 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] SCHEDULE A – Eligible and Ineligible Costs 1. Eligible Costs 1.1 Eligible Project Costs Eligible Costs will be all direct costs which are, in the Parties’ opinion, properly and reasonably incurred, and paid by an Eligible Recipient under a contract for goods and services necessary for the implementation of an Eligible Project. Eligible costs may include only the following: (a) the capital costs of acquiring, constructing or renovating a tangible capital asset, and any debt financing charges related thereto; (b) the fees paid to professionals, technical personnel, consultants and contractors specifically engaged to undertake the surveying, design, engineering, manufacturing or construction of a project infrastructure asset and related facilities and structures; and (c) the costs of environmental assessments, monitoring, and follow-up programs as required by the Canadian Environmental Assessment Act, or a Provincial equivalent. 1.2 Eligible Costs in relation to a Recipient’s Employees and Equipment Except for those costs specifically set out as ineligible under section 3(c), the incremental costs of the Recipient’s employees or equipment may be included in its Eligible Cost under the following conditions: (a) the Recipient has determined that it is not economically feasible to tender a Contract; (b) employees or equipment are employed directly in respect of the work that would have been the subject of the Contract; and (c) the arrangement is approved in advance and in writing by the Management Committee. 2 Ineligible Costs Costs related to the following items are ineligible costs: (a) Eligible Project costs incurred before the date on which an application for funding for the Eligible Project was made; (b) services or works that, in the opinion of the Parties, are normally provided by the Eligible Recipient or a related party; (c) an Eligible Recipient’s overhead costs, its direct or indirect operating or administrative costs and, more specifically, its costs related to planning, engineering, architecture, supervision, management and other activities normally carried out by its staff; (d) costs of feasibility and planning studies for individual Eligible Projects; (e) taxes for which the Eligible Recipient is eligible for a tax rebate and all other costs eligible for rebates; (f) costs of land or any interest therein, and related costs; (g) routine repair and maintenance costs; (h) legal fees; (i) audit and evaluation costs; (j) except as specified under section 1.2 above, salaries and other employment benefits of any employees of the Eligible Recipient; (k) except as specified under section 1.2 above, costs of leasing of equipment by the Eligible Recipient; and (l) administrative costs incurred as a result of implementing this Agreement. ITEM J. - 2. Page 99 of 143 Page 13 of 13 Town of Oliver - Agreement [AG422-0-Regionally Significant Projects Fund (RSP)] SCHEDULE B – Eligible Project The following is the Eligible Project for purposes of this Agreement: Buchanan Road Water Supply Well The project consists of the following at the Buchanan Road site: • Construction of an approximately 400mm dia. water supply well; • Construction of an enclosure building for well, pumping and chlorine generation equipment and controls; • Purchase and installation of pumping and chlorine generation equipment, controls and SCADA systems; and • Connection to the existing distribution pipeline network. ITEM J. - 2. Page 100 of 143 ITEM J. - 2. Page 101 of 143 ITEM J. - 2. Page 102 of 143 ITEM J. - 2. Page 103 of 143 ITEM J. - 2. Page 104 of 143 ITEM J. - 2. Page 105 of 143 ITEM J. - 2. Page 106 of 143 ITEM J. - 2. Page 107 of 143 ITEM J. - 2. Page 108 of 143 ITEM J. - 2. Page 109 of 143 ITEM J. - 2. Page 110 of 143 ITEM J. - 2. 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