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2017-2021 Proposed Draft Financial Plan April 10, 2017
The Corporation of the Village of Slocan Proposed Draft Financial Plan April 10, 2017
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Presenter: Colin McClure, Chief Financial Officer
Agenda Introduction Quick Facts 2017 – 2021 Financial Plan Process 2017 Budget overview Taxation & Operating Budget Comments & Questions Presenter: Colin McClure, Chief Financial Officer
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Quick Facts All Village Operational revenue about $729,000
Total operational expenses about $578,000 Revenue over expenses pay down debt, fund capital purchases & flow into Operational and Capital reserves General Fund Operational expense is budgeted at $521,000 in 2017, funded by $160,000 in Taxation (approx. 3 to 1 ratio) A 1% increase in taxation produces about $1,540 to cover operational expenditures
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Financial Planning Process
Departmental staff prepare budget Finance staff & senior management review Adjustments by staff Staff presentations to Council Council debate & propose tax rate Public consultation Council review of input & potential subsequent changes Bylaw introduction and adoption Today
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General Operating Budget Principles Council’s Direction to Staff
Support delivery of municipal services Maintain services delivered at 2016 levels Reduce costs of service delivery, where possible, while minimizing service impact levels Generate new revenue Minimize tax rate increase Long term planning as a focus Continue infrastructure program Implement sustainability principles
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Budget Overview - 2017 Highlights:
For 2017 the expected revenue generation from New residential construction is $2,306 However, in the Business category there was a Non Market Change decrease which will lower business taxes by $264 This will result in a net increase in tax revenue by $2,042 in 2017 Recommending a 3% average overall property tax increase There was a 2.75% or $12 annual increase in water rates for a home in 2017 No change in garbage fees 2017 Capital Budget: $361,000 in General $104,500 for Water capital $500,000 placeholder to get the Hydro project underway in 2017
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Tax Revenues: Growth – Where does it come from?
New revenue only exists when there is new assessment Increase in “inventory” i.e. through subdivision or new construction General increases in market value do not generate more tax dollars Past couple of years has resulted in minimum new revenues from growth
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Effect of Assessments in 2016
Average market changes: Residential up 6.30% from 2016 Commercial up 1.75% from 2016 Council has directed staff to adjust the Business tax multiplier in order collect the same percentage in taxation from Commercial properties and Residential in the current year. The 2016 Business multiplier was 1.06 This will keep the tax sharing consistent with prior year, which was 89% Residential, 6% Business, 2% Light industry & 3% from Utilities.
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Allocation of 2016 Taxes on an average SFD
Municipal Taxes $600 School Taxes 351 RDCK 247 Police tax 49 Regional Hospital 42 BCAA & MFA 8 Total $1,297
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2017 Proposed Budget Effect on $153,000 Assessed Home
2016 Actual 2017 Proposed Net Annual Change Net Monthly Change Property Tax (municipal only) 647 666 $ 19 $ 1.58 Water Rates (after discount) 423 435 12 1.00 Resource Recovery 120 Overall $1,190 $1,221 $ 31 $2.58
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Overall Capital Plan – 2017 Highlights
Total Operating & Water Capital - $465,000 New dump truck and sanding/snowplowing attachments Significant paving program Wellness Centre signage Seniors Housing project preparation Legion Hall roofing Works yard fencing Waterline replacement Water plant pump and other upgrades Storm water management plan & sewer and drainage upgrades Hydro project – grant approval recently announced $500,000 budgeted in 2017 to get projected started with plan for major work to be done in 2018
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Debt and Debt Servicing
Major capital projects typically funded by using combination of existing reserves and by borrowing funds. Strategic decision when to borrow vs using reserves or taxation. Currently the Village has no long-term debt only a capital lease with 1.5 years and $10,047 remaining The Village will likely need to borrow to fund the Springer Creek Hydro power project
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Comments and Questions?
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