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HomeMy Public PortalAboutFinancial Plan Bylaw 1402 (2021-2025)5 Year Financial Plan Bylaw 1402 CONSOLIDATED FOR PUBLIC CONVENIENCE (Includes Amendments up to December 13, 2021) The text of Town of Oliver’s 5 Year Financial Plan Bylaw has been amended by the following bylaws: Bylaw 1402.01 Removing Schedule ‘A’ 5 Year Financial Plan – Years 2021 – 2025 in its entirety and replacing with a new Schedule ‘A’. TOWN OF OLIVER BYLAW 1402 A bylaw to adopt the 5 year financial plan for the calendar years 2021 through 2025 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 2021 through 2025. 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 2021 through 2025. 3.This bylaw may be cited for all purposes as the "5 Year Financial Plan Bylaw 1402". 4.Authority to make expenditures in accordance with the 5 year financial plan is hereby delegated to the following Management Staff: 1)Chief Administrative Officer 2)Chief Financial Officer 3)Deputy Finance Officer 4)Corporate Officer 5)Deputy Corporate Officer 6)Director of Development Services 7)Director of Operations 8)Deputy Director of Operations 8)Fire Chief 9) Deputy Fire Chief Read a first, second and third time and adopted on the 8th day of March, 2021 1 _____________________________ ________________________________ Mayor Corporate Officer 1 With authority of Ministerial Order No. M083 dated March 26, 2020 ' Original signed by Mayor '' Original Signed by Corporate Officer ' Amendment Bylaw No. 1402.01 Page 2 Schedule ‘A’ to Bylaw 1402.01 2021 2022 2023 2024 2025 Budget Amendment Budget Budget Budget Budget REVENUES User Fees 3,838,951 4,106,189 4,427,277 4,543,906 4,653,603 Property taxation 2,828,177 3,493,446 3,789,394 3,868,956 3,947,232 Government transfers 5,123,098 917,410 926,584 935,850 945,209 Concessions and franchise 421,335 421,335 421,335 421,335 421,335 Gain (loss) on disposal of TCA - - - - - Other revenue from own services 561,534 561,534 561,534 561,534 561,534 Sale of services 253,450 253,450 247,150 247,150 247,150 Proceeds from Insurance 374,685 Investment income 40,000 40,000 40,000 40,000 40,000 Development cost charges - 125,000 - - - Contributions from developers and other 104,100 291,500 1,500 1,500 1,500 13,545,330 10,209,864 10,414,774 10,620,231 10,817,563 EXPENSES Water Services 2,818,280 2,903,158 2,989,086 3,025,933 3,051,854 General Government Services 1,624,000 1,239,609 1,264,401 1,289,689 1,315,483 Sewer Services 1,140,512 1,171,271 1,221,338 1,246,409 1,285,434 Transportation services & public works 1,576,897 1,608,435 1,640,604 1,673,416 1,706,884 Protective Services 549,814 1,544,000 1,574,880 1,606,378 1,638,506 Development Services 513,144 523,407 533,875 544,553 555,444 Environmental & public health services 442,410 451,258 460,283 469,489 478,879 8,665,057 9,441,138 9,684,467 9,855,867 10,032,484 SURPLUS (DEFICIT) FOR THE YEAR 4,880,273 768,726 730,307 764,364 785,079 ADJUSTED FOR NON-CASH ITEMS Amortization 1,412,099 1,426,044 1,440,268 1,454,777 1,469,576 Inventory expense 30,500 30,500 30,500 30,500 30,500 Prepaid expense 15,000 15,000 15,000 15,000 15,000 1,457,599 1,471,544 1,485,768 1,500,277 1,515,076 TOTAL CASH FROM OPERATIONS 6,337,872 2,240,270 2,216,075 2,264,641 2,300,155 ADJUSTED FOR CASH ITEMS Capital asset expenditures 12,786,191- 11,645,300- 6,178,000- 3,377,800- 4,794,800- 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 443,562- 462,389- 667,302- 679,620- 691,167- Debt proceeds 4,367,000 6,208,000 4,196,000 1,180,000 1,605,000 Transfer from (to) reserves 4,230,553 4,998,796 1,952,996 2,163,796 3,150,796 Transfer from (to) surplus 1,660,172- 1,293,877- 1,474,269- 1,505,517- 1,524,484- 6,337,872- 2,240,270- 2,216,075- 2,264,641- 2,300,155- FINANCIAL PLAN BALANCE 0 0 0 0 0 Amended by 1402.01 December 13, 2021 - 3 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1402 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 2019 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 90% 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. - 4 - TOWN OF OLIVER 5 Year Financial Plan Bylaw 1402 Schedule “B” - Statement of Objectives and Policies Table 1 – Sources of Funding (2021) Funding Source % Total Funding Amount Debt proceeds 24.1%4,367,000$ Grants 21.1%4,848,327$ User fees and sale of services 20.1%4,092,401$ Reserves 15.4%2,574,949$ Municipal Taxation, net 9.7%1,977,622$ Other sources 6.0%1,224,270$ Parcel taxes 3.7%753,254$ Development cost charges 0.0%-$ 19,837,823$ Distribution of Property Tax Rates Table 2 below shows the proposed 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 keep ing the proportionate relationship between all other classes equal. • Over the next five years the property tax increases will ensure that the rate payers will reduce the financial burden associated with expected futures costs for the Town. Policies • Supplement, where possible, revenues from user fees and charges to help offset the burden on the entire property tax base. • Continue to apply additional taxes that would have been collected from new non-residential development against the tax increases in those classifications. This results in slowly reducing the proportions of taxes paid by the commercial sector in relation to the residential sector. • Regularly review and compare the Town’s distribution of tax burden relative to other municipalities in the South Okanagan. - 5 - Table 2 – Distribution of Property Tax Rates (20 21) Property Class % Property Value Tax Amount Residential 73.3%1,450,026$ Business 23.0%455,521$ Light Industry 2.3%44,743$ Utility 1.1%22,504$ Farm & recreation 0.2%4,828$ 1,977,622$ TOWN OF OLIVER 5 Year Financial Plan Bylaw 1402 Schedule “B” - Statement of Objectives and Policies Permissive Tax Exemptions The Community Charter permits council to provide permissive tax exemptions for a period of up to 10 years for specific types of properties. Council adopted a 4 year bylaw, pursuant to section 224 of the Community Charter, which is in effect for 2021 to 2024. The Annual Municipal Report for 2020 will contain a list of permissive exemptions and the amount of tax revenue foregone. The list demonstrates the policy of council that permissive exemptions are granted to not-for-profit institutions that form a valuable part of our community. Many property tax exemptions are provided to properties automatically by the Assessment Authority of BC. For example, properties owned by the municipality or other levels of government are exempted 100%. Other properties such as churches and hospitals are generally exempted only for buildings and the land directly beneath the footprint of the building. Objectives • Council’s principle objective in considering permissive tax exemptions under section 224 is to provide financial assistance to organizations that provide a valuable service to the broader community. These services may include cultural and recreational opportunities for adults and youth, promotion of the local economy and local charitable services. • Council’s principle objective in considering permissive tax exemptions under section 226 is to provide a short-term financial incentive to promote certain types of economic development. Policies • Provide permissive tax exemptions for all qualifying land uses to those organizations that provide valuable services to the broader community. • Integrate the revitalization tax exemption program into the Town’s existing initiatives as a means of attracting retail, commercial and industrial businesses to further invest in the community.