committee of the whole agenda · 2019-11-22 · committee of the whole agenda. the agenda for the ....

Committee of the Whole Agenda

The agenda for the Freestanding Committee of the Whole (Corporate Services Committee- Budget) meeting to be held in the Council Chambers of the Municipal Hall, 8645 Stave Lake Street, Mission, British Columbia on Monday, February 23, 2015, commencing at 2:00 p.m.

1. CALL TO ORDER

2. ADOPTION OF AGENDA

3. CORPORATE SERVICES

(a) Municipal Partnership Fee for Service Organization Presentations

• Mission Arts Council • Lifetime Learning Society • Mission Adopt-A-Block

The Committee requested, at the February 11, 2015 Freestanding Committee of the Whole (Corporate Services Committee – Budget) meeting, that these three organizations give a presentation on their spending package.

Verbal

(b) Council Attendance at Conferences Staff are seeking Council’s direction in terms of the Council Attendance at Conferences Policy and budget as the 2015 budget discussions move forward.

Page 3

(c) Administrative Cost Recoveries This report discusses the Council policy that specifies how administrative cost recoveries are charged to various areas of the organization, such as the water and sewer utilities. Options for Council’s consideration are included in this report.

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(d) 2015 General Operating Fund Draft Budget Status This report provides an overview of the status of the 2015 draft operating budget for the general operating fund for discussion purposes.

Page 19

(e) 2015 Public Budget Consultation Information No staff recommendation accompanies this report; however, staff are requesting direction from Council as to what form the proposed 2015 budget information is to take at a public consultation meeting.

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Freestanding Committee of the Whole Agenda (Corporate Services – Budget) Meeting February 23, 2015

(f) 2015 Tax Rates and Tax Ratios This report provides Council with the financial plan bylaw objectives and policies regarding the proportion of total revenue that comes from each of the funding sources described in Section 165(7) of the Community Charter; the distribution of property taxes among the property classes; and the use of permissive tax exemptions. This report is to solicit discussion and for Council to have the opportunity to provide staff with any wording changes that they would like to see in regards to the bylaw objectives and policies.

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4. ADJOURNMENT

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Finance Department

Staff Report to Council

Page 1 of 3

File Category: LGMA Administration File Folder: 0340-50-02

DATE: February 11, 2015

TO: Mayor and Council

FROM: Kerri Onken, Deputy Treasurer/Collector

SUBJECT: Council Attendance at Conferences ATTACHMENT(S): Appendix A – Council Attendance at Conferences CON.1 Policy

Appendix B – Report from the Director of Corporate Administration dated April 14, 2010 entitled “Council Conference Policy” and included the Report from the Director of Corporate Administration dated February 25, 2010 entitled “Council Conference Budget”

Staff are seeking Council’s direction in terms of the Council Attendance at Conferences Policy and budget as the 2015 budget discussions move forward.

PURPOSE: The purpose of this report is to initiate discussion and to provide information to Council on the current Council Attendance at Conferences CON.1 policy.

BACKGROUND: At the April 19, 2010 Regular Meeting of Council, a r eport from the Director of Corporate Administration (Appendix B) was provided to Council with, as an attachment, a report that was presented the month before on March 15, 2010.

The attached Appendix “A” is the current Council Policy CON.1 Council Attendance at Conferences. The policy not only outlines a budget for Mayor and Council member but also names conferences that Council may be interested in attending. This was created around a t hree-year council term and starting with the 2014 Election, a council term is now four years.

In 2010, the annual budget for Mayor and C ouncil’s conferences was increased from $8,750 to $11,250. In 2012, the budget was increased to $18,000 to implement this policy and subsequently reduced by $1,053 as part of an exercise reducing all conference cost across the organization. The current budget is now $16,947.

Date: February 23, 2015 To: Mayor and Council From: Kerri Onken, Deputy Treasurer/Collector It was requested by the Committee at the February 11, 2015 Freestanding Committee of the Whole meeting, to bring this report back to the February 23, 2015 Freestanding Committee of the Whole meeting.

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STAFF REPORT TO COUNCIL Page 2 of 3

DISCUSSION AND ANALYSIS:

The estimated 2015 costs for conferences that Council may be interested in are summarized in the table below.

Conferences Location and 2015 2015 Dates

Cost Estimates

Range*

Cost Range for 7

Attendees

Union of BC Municipalities (UBCM)

A provincial organization representing local governments. Vancouver,

September 21 – 25 $3,000

to 4,000 $21,000

to $28,000

Federation of Canadian Municipalities (FCM)

A national organization representing municipal governments.

Edmonton, June 5 - 8

$2,200 to $4,000

$15,400 to $28,000

Lower Mainland Local Government Association (LMLGA)

LMLGA is one of the 5 area associations of the UBCM. It includes 33 local governments (from Pemberton to Hope) and 3 regional districts, Squamish/Lillooet, Metro Vancouver and Fraser Valley Regional Districts.

Harrison, May 6 – 8

$1,000 to $2,000

$7,000 to $14,000

Local Government Management Association (LGMA)

A provincial association supporting excellence in local government by providing training and resources to facilitate the exchange of ideas and best practices.

Prince George, June 16 - 17

$475 to $775

$3,325 to $5,425

Total Range for 7 Attendees: $46,725 to $75,400

* Cost estimates include conference costs, accommodations, per-diem and travel. Costs could be reduced with early booking of conferences, different accommodations and whether meals are included.

FINANCIAL IMPLICATIONS: The current budget for Council conferences is currently $16,947 annually. Unless Council’s new approach indicates a change to the current budget, there are no financial implications associated with this report.

COMMUNICATION: No communication action is required, although this change would be i ncluded within the Public Budget Consultation document.

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SUMMARY AND CONCLUSION: The purpose of this report is to initiate discussion and to provide information to Council on the current Council Attendance at Conferences CON.1 policy.

The attached Appendix “A” is the current Council Policy CON.1 Council Attendance at Conferences. The policy not only outlines a budget for Mayor and Council member but also names conferences that Council may be interested in attending.

In 2012, the budget was increased to $18,000 to implement this policy and subsequently reduced by $1,053 as part of an exercise reducing all conference cost across the organization. The current budget is now $16,947.

SIGN-OFFS:

Kerri Onken, Deputy Treasurer/Collector

Reviewed by: Kris Boland, Manager of Finance

Comment from the Chief Administrative Officer Reviewed

G:\FINANCE\MINUTES\2015\150211\Council Conference Policy Memo.docx

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________________________________________________________________________________________________________________________ District of Mission Corporate Administration

Conferences - Council Attendance at Conferences - CON.1 Page 1 of 1

CONFERENCES

COUNCIL ATTENDANCE AT CONFERENCES

CON.1

POLICY

Date Policy Adopted: February 4, 2008 Council Resolution Number: 08/104 Date Policy Amended: April 19, 2010 Council Resolution Number: RC10/198 1) At the commencement of each three year council term, the mayor and each councillor will

have a three year conference and education budget as follows:

a) for the mayor $12,000

b) for each council member $7,000

2) During the first and second year of the council term, the mayor and council members may carry forward any unspent funds to the following year.

3) It is generally anticipated that the mayor and council members will use their budgeted funds to annually attend both the Union of British Columbia Municipalities and Lower Mainland Local Government Association conferences.

In addition, the mayor may attend the Federation of Canadian Municipalities conference annually, and council members may attend the Federation of Canadian Municipalities conference once during each three year term.

4) Notwithstanding section 3, council members may, at their own discretion, use their conference and training budget to attend any conference or educational opportunity that is relevant to council responsibilities.

Appendix A 6

Corporate AdministrationMemorandum

62

isslonMDISTRICT OF

ON THE FRASER

File Category: ADM.POL.PROFile Folder: CON,?

To: Chief Administrative Officer

From: Director of Corporate Administration

Date: April 14, 2010

Subject: Council Conference Policy

RecommendationThat Policy CON.1 Council Attendance at Conferences be amended to:

1. Provide the mayor and each council member with a three year conferencebudget at the commencement of each new council term, as follows:

a. a three year conference budget for each councillor of $7,000

b. a three year conference budget for the mayor of $12,000.

2. Permit the mayor and council members to carry forward unexpended fundsfrom their individual conference budgets, in the first and second year of thethree year council term.

3. Include that all council members may attend UBCM, LMLGA, or other similarconferences annually, and that each council member may attend one FCMconference during their three year term.

4. Amend the three year financial plan commencing in 2012, to reflect the policychanges.

BackgroundCouncil has historically overspent its conference funding based on a structuraldeficit in the budget. This results from council members wanting to attend both theUBCM and LMLGA conferences, while the budget provides for one or the other.Some council members have also opted to attend other conferences, using theirbudget allocation while making up any difference from their personal funds.

Attached is a report dated February 15, 2010 which council reviewed on March 15,2010 at its regular meeting. The report was provided in response to a request fromcouncil regarding alternative ways to use their individual conference and educationbudgets.

In response to that report council adopted the following resolution on March 15,2010:

Page 1 of 4

Appendix B 7

RC 10/137MAR. 15/10

Council Conference Budget

63

Moved by Councillor Scudder, and

RECOMMENDED: That staff provide a report to council with recommendationsto amend policy CON.1 to incorporate a carry-over approach for unused fundsfrom previous conference budgets, and with information about comparablepolicies and funding amounts for council attendance at conferences from themunicipalities of Maple Ridge, Langley, Chilliwack and Abbotsford.

The recommendations and following information respond to that resolution.

1. Comparison By Municipalities

As in the past, a survey of the comparison municipalities has revealed that thereare various approaches to the funding of council attendance at conferences.

It is also clear that local municipalities spend considerably more on theseconferences than does Mission.

Mission, Maple Ridge and Langley City take a similar approach in that actual dollarsare budgeted for the mayor and council members. Abbotsford and Chilliwackbudget bulk amounts and simply reimburse based on actual expenses.

The following table sets out the comparisons between the 5 communities.

Mission Abbotsford Maple Ridge Chilliwack LangleyCity

Mayor $3,750 yr

All expensesincluded

reimbursedfor actualexpenses

annual councilbudget of upto $32,500 fortraining /conferences

$6,500 yr


reimbursed foractualexpenses

annual councilbudget of $86,000for all councilexpenses(inauguralmeeting,conferences, travelcosts, cell phones,memberships,etc.)

$17,500/3 years =$5,833 yr.

Council $1,250 yr


reimbursedfor actualexpenses

$5,000 yr


reimbursed foractualexpenses

$6,730/3 years =$2,243 yr.

Total annualbudget

$11,250 Up to$32,500

Up to $36,500 +/- $50,000(est.)

$19,294

PermittedConferences

any any any any any

Page 2 of 4

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1. Current Practice

The District currently budgets $11,250 annually for conferences, including $1,250for each council member and $3,750 for the mayor.

Should council accept the recommendation, the annual conference budget willincrease to $26,000. While this may seem to be a dramatic increase, Mission'sbudget would still be less than Abbotsford, Maple Ridge, and Chilliwack. Mission,Maple Ridge, Chilliwack, and Langley City all have 7 council members, whileAbbotsford has 9.

As noted, the current annual budget is $11,250. This budget has been consistentlyoverspent, and by a considerable margin in two of the last three years. Onaverage, the annual expenditures have been $15,879 with the two highest yearsbeing $17,134 and $17,920. Those figures are also tempered by the fact that notall council members attend the conferences.

The annual costs are:

a. for each councillor, a total of $7,000 for each three year cycle: based on 3yrs. X $1,500 each for annual attendance at UBCM and LMLGA + 1 X $2,500every three years to attend FCM once each three year term = $42,000 for thethree year cylce;

b. for the mayor $12,000 for each three year cycle: based on 3 years X $1,500each for annual attendance at UBCM and LMLGA + 3 years X $2,500 each toattend FCM = $36,000 for the three year cycle.

2. Carry Forward of Unexpended Funds

Since Abbotsford and Chilliwack provide for "reimbursement for expenses", therewould be no carry forward of any budgeted amounts.

Maple Ridge takes the same approach that Mission does, i.e. annual budget foreach council member and the mayor.

Langley City takes a different approach (and one which council previouslydiscussed) by providing a 3 year budget for each council member and the mayor.Neither Maple Ridge nor Langley City provide for any carry forward of unexpendedfunds.

3. Options

Council could decide to move to the Langley City model and provide a 3 yearconference budget for the mayor and each council member. Council could alsoallow for the carry forward of any council member's unexpended budget, year overyear.

However, for obvious and practical purposes, a 3 year conference budget and anycarry forwards should be based on the 3 year electoral cycle and commence with

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Page 3 of 4

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the inauguration of a new council.

The recommendation is to implement this practice, commencing in 2012. Thiswould coincide with the commencement of a new council term. It should alsoprovide ample time to incorporate the change in the financial plan.

Summary

Some improvements can be made to the policy as noted in the recommendations.It is also clear that there is inadequate funding to met councillors' needs regardingattending important conferences.

The recommendation will recognize and resolve the funding deficit and budgetrealistically for council's needs.

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ntial dark rrent nference attendance.doc

Page 4 of 4

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viissionON THE FRASER /41111

Corporate AdministrationINFORMATION Memorandum

66

File Category:

FIN.BUD.CORFile Folder:

2010 Budget

To: Chief Administrative Officer

From: Director of Corporate Administration

Date: February 25, 2010

Subject: Council Conference Budget

Each year the District allocates $1,250 to each councillor to attend conferences oreducational opportunities. Each councilor may choose how to use their allocations,as long as the opportunity is directly related to council business.

Council recently directed that staff look at amending the current policy CON.1(attached) so that councillors could use their allowance over a 3 year period (i.e.not annually), and bring the information back to council for further discussion.

In theory the policy can be amended to accommodate this suggestion. There wouldbe some additional administration required to track the funds, for the reasons notedbelow.

I suggest that consideration be given to related questions, so council can discusswhether the concern that is trying to be addressed is best accommodated by thesuggested change.

Several questions occur regarding the suggestion:

1. What is the definition of the "3 year period"? Presumably it is the 3 yearsimmediately following election? If not, how is the 3 year period determined?

It should be noted that new councillors will likely have no idea about whatconferences will occur in any year, whether any conference would be of anyparticular interest or value, and they would therefore experience considerabledifficulty in determining how to allocate their funds.

The reality is that there are several conferences that occur in any given yearthat council members may find interesting. The ability to attend is limited bythe funding available.

2. Does council want the councillor to have access to this 3 year's worth of funds atanytime during the defined period? If so, the budget will need to be increasedto allocate al! of the 3 years of funding into the first year of the 3 year period.

Page 1 of 3

Appendix B 11

3. The total value of 3 years of funding per councillor is $3,750. Would councilagree that an expenditure of $3,750 to attend a single conference is reasonable?

4. If a councillor has expended all of their allocated funds, and then requestsadditional funds, will the funds be provided? In other words, how accurate isthe policy, or a revised policy? If council does not believe the policy is eitherreasonable or defensible, what improvements would council like to see?

5. Other similar questions might arise such as "if a councillor does not spend theirtotal annual allotment in one year, can they carry forward the balance of theallotment for one or more years?"

Obviously the more detailed and complicated the process becomes, the moreadministrative time that is required to administer the task. While on an individualbasis these administrative tasks may not seem to be egregious, the cumulativeeffect of every new requirement or complication becomes considerable.

g: \cow \2010\0315 march 15\con 1.doc

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Page 2 of 3

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Finance Department


Page 1 of 4

File Category: LGMA Finance File Folder: 1700-01



FROM: Kris Boland, Manager of Finance

SUBJECT: Administrative Cost Recoveries ATTACHMENT(S): Appendix A – Policy Fin.38 General Administration and E ngineering Cost

Recoveries

This report discusses the Council policy that specifies how administrative cost recoveries are charged to various areas of the organization, such as the water and s ewer utilities. Options for Council’s consideration are included in this report.

PURPOSE: The purpose of this report is to discuss the Council policy that specifies how administrative cost recoveries are charged to various areas of the organization, such as the water and sewer utilities, and to seek Council direction as to whether their preference is to change the policy.

BACKGROUND: Further to discussion that occurred at the February 11, 2015 Freestanding Committee of the Whole (Corporate Services Committee – Budget) meeting, this report reviews the Council policy that specifies the methodology used to charge administrative cost recoveries to various areas of the organization. Policy Fin.38 - General Administration and Engineering Cost Recoveries (Fin.38), which was implemented in 2005 and last updated in 2011, is attached to this report as Appendix A.

As per Fin.38, administrative costs are allocated to various operating areas, as well as capital projects, on a per centage basis. Fin.38 states that where it isn’t feasible and pr actical to track the actual amount of general and administrative services utilized in various areas, the District needs to estimate the amounts through a cost recovery percentage. This aligns with a primary concept of cost accounting, in that costs of gathering detailed information should not outweigh the benefits of that information to the users; it appears the intent of the policy was to find a balance between those costs and benefits.

The basic premise of Fin.38 is that the District’s general administrative costs are initially charged to the general operating fund, which is supported by property taxes. The cost recovery calculation then charges a por tion of these costs to various areas, such as the water and s ewer utilities, which generates a recovery of costs to the general operating fund.

DISCUSSION AND ANALYSIS: Cost Recovery Items Covered by Fin.38 The following table shows the cost items that are specified in Fin.38 that are intended to be recovered through a percentage allocation in either the operating or capital areas:

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Cost Item Operating Capital General government management staff Yes Yes Accounting: invoicing and collections Yes No Accounting: accounts payable and payroll Yes Yes Budgeting and financial reporting Yes Yes Information technology services Yes Yes Purchasing and stores services Yes Yes Liability insurance Yes Yes Engineering management staff Yes No Engineering project management, design, survey and inspections No Yes

The “yes/no” items in the above table indicate whether or not the cost items are typically applicable to either the operating or capital functions of the District.

The operating and c apital cost recoveries both include a c omponent for general government administration and en gineering administration; the percentage recoveries for both areas vary depending on the involvement in each area, and are specified in the policy. The purpose for this is to be able to show the engineering portion offsetting the engineering budget, and t he general government portion offsetting the general government budget. For simplicity, the analysis that follows in this report consolidates the general government and en gineering amounts to show the overall impact on the budget.

Operating Cost Recovery Amounts The following table shows the percentages and amounts of operating cost recoveries included in the 2014 and 2015 budgets:

Operating Area Cost Recovery % 2014 Budget 2015 Budget Increase Equipment (fleet) 2% $ 47,676 $ 51,480 $ 3,804 Forestry 5% (annual maximum of

$120,000 A) 120,000 120,000 - Transit 6% 154,112 163,174 9,062 Waste management utility 6% 271,646 264,666 (6,980) Water utility 12%B 715,400 723,232 7,832 Sewer utility 12%B 505,996 502,746 (3,250) Total Operating Cost Recoveries $1,814,830 $1,825,298 $10,468

Note A: Fin.38 currently shows $150,000 annual maximum; decrease to $120,000 annual maximum was approved as part of the 2013 budget; formal policy update is on-hold, pending the District wide policy and procedure update.

Note B: Fin.38 currently shows 10.5%; increase to 12% was approved at October 9, 2012 Administration and Finance Committee meeting; formal policy update is on-hold, pending the District wide policy and procedure update.

Capital Cost Recovery Amounts The following table shows the capital cost recovery percentages that are specified in Fin.38:

Capital Area Cost Recovery % Non-engineering capital projects 2.5% Engineering capital projects 5% Regional water and sewer capital projects 2%

The 2015 budg et includes a t otal estimate of $427,715 for capital cost recoveries, which is a $131,605 increase over the prior year amount of $296,110. This includes a factor for the estimated carry-forwards from the prior year, as well as an estimate of amounts that would likely be carried-forward to the following year. The capital cost recovery can be quite volatile from year to year, given that the capital budget typically changes from year to year depending on the number of one-time projects.

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Challenges with Fin.38 1. The policy is intentionally designed to be a c ompromise between the amount of effort taken to

gather the actual detailed costs that are required to support the various areas, and the information value that is gained by going to that amount of detail. However, this compromise makes it difficult to demonstrate that when a new staff position is added t hat partially supports general administration and partially supports the utilities, there is an immediate impact on the related cost recovery.

An additional effect of this is while the cost recovery dollars generated by the percentages in the policy may have made sense when the policy was implemented, the cost recovery amounts will often make less and less sense over time as changes occur in various areas of the budget. Staff are uncertain if the amounts currently generated by the policy truly represents the actual costs, and further investigation should be done in this area.

2. The policy lacks clarity on what amounts to apply the cost recovery percentages to, which has led to staff having to apply their interpretation of the policy.

3. The policy specifies a method of arbitrary percentage allocation of overhead to capital projects. At the time the policy was first adopted in 2005, this wasn’t an issue from the perspective of accounting standards. However, the related accounting standard for capital assets changed in 2009, and it prohibits charges to capital projects that are not directly attributable to their construction or development (i.e. percentage charges for indirect costs such as overhead are not allowed). Staff have developed a “ work-around”, which allows the capital cost recoveries to be factored into the budget and accounting records as intended by the policy, however the accounting has to be “undone” for the purposes of the District’s audited financial statements. This causes a significant amount of extra work for staff to comply with the policy, only to have to reverse those entries for the financial statements. Based on this discrepancy with the accounting standards, it begs the question as to whether the capital cost recoveries should be continued.

4. The policy doesn’t address all items that could be described as overhead. For example, in terms of facility usage, an argument could be made that since municipal hall staff are working in part to support the water and sewer utilities, then a portion of the municipal hall facility overhead should be charged to the water and sewer utilities.

Options for Consideration The following are staff’s suggestions as to improvements that could be made to Fin.38:

1. Switch the operating cost recoveries from a percentage-based approach to a f lat-rate approach. This would certainly make budgeting easier, as well as improve the transparency that when a new position is added that partially supports the utilities, an immediate and corresponding increase to the flat-rate charge can be clearly communicated to taxpayers. This would also reduce the effect that over time, a percentage-based approach starts to break down the relationship between the cost recovery calculation and the actual costs.

2. Eliminate capital cost recoveries. This is a very complicated task, as the capital recoveries affect each area of the budget differently. Staff require additional time to formulate a plan to eliminate capital cost recoveries.

FINANCIAL IMPLICATIONS: There are no financial implications directly associated with this report; however, any changes to the current policy may result in financial implications that will need to be considered.

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COMMUNICATION: No communication action is required.

SUMMARY AND CONCLUSION: This report discusses policy Fin.38, regarding administrative cost recoveries. The policy was intentionally designed to be a c ompromise between the amount of effort taken to gather the actual detailed costs that are required to support the various areas, and the information value that is gained by going to that amount of detail. This is a primary underlying concept of cost accounting, recognizing there is a cost-benefit relationship between the effort spent and the value gained. There are a number of challenges with Fin.38. The report includes some options to improve the policy, depending on the goals Council would like the policy to address.

SIGN-OFFS:

Kris Boland, Manager of Finance

Reviewed by: Kerri Onken, Deputy Treasurer/Collector

Comments from the Interim Chief Administrative Officer Reviewed.

g:\finance\budget\budget 2015\memo - administrative cost recoveries.docx

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District of Mission Finance Department Finance – General Administration and Engineering Cost Recoveries - FIN.38 Page 1 of 2

FINANCE

GENERAL ADMINISTRATION AND ENGINEERING

COST RECOVERIES

FIN.38 POLICY Date Policy Adopted: November 7, 2005 Council Resolution Number: 05/919 Date Policy Amended: June 23, 2008 Council Resolution Number: C2008/0249 Date Policy Amended: July 6, 2009 Council Resolution Number: RC09/426 Date Policy Amended: February 21, 2011 CAO Approval 1. General

General administration support is provided to all operating funds/areas and t o capital projects. In addition, engineering support is provided to certain operating funds/areas and to certain capital projects. As the operating funds/areas and the capital projects are utilizing general administration and eng ineering resources, the costs associated with these support services need to be allocated to the various funds/areas and to the capital projects accordingly.

2. Cost Recovery Methodology Whereas is it is not feasible and pr actical to track the actual amount of general administration and eng ineering services/costs utilized by the various operating funds/areas and t he capital projects, the District needs to estimate the amount of resources utilized in each operating fund/area and by the capital projects. As such, the District will hereby establish cost recovery percentages, which will be calculated on the various expenditures (does not include general administration and engineering cost recovery expenditures) within the various operating and capital areas.

3. Cost Recovery Areas, Items and Percentage Recoveries

The general cost items that are utilized by each operating fund/area are noted in Table 1 below, together with the expenditure cost recovery percentages that will be charged.

Appendix A 17

GENERAL ADMINISTRATION AND ENGINEERING COST RECOVERIES FIN. 38

District of Mission Finance Department Finance – General Administration and Engineering Cost Recoveries - FIN.38 Page 2 of 2

Table 1 – OPERATING COST RECOVERIES Operating Areas General Administration (1) Engineering (2)

Equipment Operations 1% 1% Forestry Operations 5%

To a maximum of $150,000 per year N/A

Refuse Operations 3% 3% Water Utility Operations 5% 5.5% Sewer Utility Operations 5% 5.5% Transit Operations 3% 3%

(1) For General Government Management Staff; General Accounting including Invoicing,

Collections, Accounts Payable, and Payroll; Budgeting & Financial Reporting; Information Technology Services; Purchasing & Stores Services; and Liability Insurance

(2) For General Engineering Management Staff N/A – Not Applicable

The general cost items that are utilized by capital projects are noted in Table 2 below, together with the expenditure cost recovery percentages that will be charged.

Table 2 – CAPITAL COST RECOVERIES Capital Areas General Administration (3) Engineering (4)

Non-Engineering Capital Projects 2.5% N/A

Engineering Capital Projects 2.5% 2.5% Regional Water and Sewer Capital Projects

2.0%

N/A

(3) For General Government Management Staff; General Accounting including Accounts Payable and Payroll; Budgeting & Financial Reporting; Information Technology Services; Purchasing & Stores Services; and Liability Insurance

(4) Engineering Project Management, Design, Survey and Inspection Services N/A – Not Applicable

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Finance Department


Page 1 of 4





SUBJECT: 2015 General Operating Fund Draft Budget Status ATTACHMENTS: Appendix A General Operating Fund Budget Summary

This report provides an overview of the status of the 2015 d raft operating budget for the general operating fund for discussion purposes.

PURPOSE: The purpose of this report is to provide an overview of the status of the 2015 draft operating budget for the general operating fund and the changes that have occurred since the February 11, 2015 Freestanding Committee of the Whole (Corporate Services Committee - budget) meeting.

DISCUSSION AND ANALYSIS:

At the February 11, 2015 Freestanding Committee of the Whole (Corporate Services Committee - budget) meeting, the 2015 general operating budget indicated the net overall budget decrease over 2014 to maintain existing services stood at $592,380, which represented a 2.12% decrease in property taxes. P roposed options for Council’s consideration were listed and included several increases to the transfers to reserves along with the spending package listing that together totaled $1,504,599.

Total projected revenue changes ( 624,226)

Total expenditure increases $682,555

Budget updates since January 20, 2015 ( 650,709)

Net decrease to maintain existing services ( 592,380)

Proposed options for Council’s consideration 1,504,599

Net increases to the 2015 draft budget $912,219

At the February 11, 2015 budget meeting Council removed several options under consideration reducing the total from $1,504,599 to $826,731. Staff have also updated the administration fee recovery resulting from the capital carry forward list being approved by Council at the February 16, 2015 Regular Council meeting. This update has resulted in an increase to revenue of $53,229. The chart below summarizes these changes and highlights the net budget impact to maintain existing

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services. The chart also includes the updated options and spending packages and the net proposed changes to the 2015 general operating fund budget should Council approval all these options.

Description Amount Estimated

Tax Increase (Decrease)

Net Impact to Maintain Existing Services: (February 11) ($592,380) (2.12%)

Admin Fee Recovery from capital carry forward (RC 15/084 Feb 16/16) (53,229) (0.20%)

(A) Net Impact to Maintain Existing Services: ($645,609) (2.32%)

Proposed Options & Spending Packages for Council’s Considerations: $1,504,599 5.40%

Options/Spending Packages Removed from List

F) Employee Identification (500) 0%

G) Health & Safety Officer (34,000) (0.12%)

I) Corporate Services staffing (47,000) (0.17%)

Q) Excess development revenue transferred to reserves (38,285) (0.14%)

R) Excess admin fee revenue transferred to capital reserves (177,794) (0.64%)

S) Increase to capital reserve for infrastructure renewal (277,900) (1.00%)

V) Manager Land Development & Property Management (102,389) (0.37%)

Updated options and spending packages for Council’s consideration: $826,731 2.96%

(B) Net proposed changes to 2015 General Operating Budget if remaining options and Spending Packages are Approved: $181,122 0.65%

The attached Appendix A summarizes the changes from 2014 final budget to the 2015 d raft provisional budget. After including the above changes the net impact to the 2015 general operating budget is $(645,609), or a 2.32% decrease, to maintain existing services (before proposed options and spending packages). Fo r the average home in Mission with an es timated assessment of $390,500, this budget decrease would represent an es timated $42.03 decrease in property taxes. (See (A) part way down on Appendix A).

By including the updated options and s pending packages for Council’s consideration totaling $826,731 the net impact to the 2015 general operating budget would be $ 181,122, or a 0.65% increase, to the District’s budget. For the average home in Mission with an estimated assessment of $390,500, this budget increase would represent an estimated $11.77 increase in property taxes. (See (B) bottom of Appendix A).

20


Budget Unknowns The budget impacts from collective bargaining with Canadian Union of Public Employees (CUPE) and the International Association of Fire Fighters (IAFF) or any other wage increases are not yet known therefore are not reflected in Appendix A at this time.

Staff continues to work with BC Assessment to get a firmer estimate of the value of additional property taxation revenue to be received from new construction. The final new construction revenue will be known by March 31, 2015.

FINANCIAL IMPLICATIONS: The financial implications are discussed throughout this report.

COMMUNICATION: Highlights of the 2015 general operating budget along with the utility funds and capital budgets will be communicated to the public at the Public Consultation session, tentatively set for March 16, 2015.

SUMMARY AND CONCLUSION: The purpose of this report is to provide an overview of the status of the 2015 draft operating budget for the general operating fund and the changes that have occurred since the February 11, 2015 Freestanding Committee of the Whole (Corporate Services Committee - budget) meeting. At the February 11, 2015 budget meeting Council removed several options under consideration reducing the total from $1,504,599 to $826,731. Staff have also updated the administration fee recovery resulting from the capital carry forward list being approved at the February 16, 2015 Regular Council meeting. The net impact of these changes to the 2015 gener al operating budget is $(645,609), or a 2.32% decrease, to maintain existing services. For the average home in Mission with an es timated assessment of $390,500, this budget decrease would represent an es timated $42.03 decrease in property taxes. (See (A) part way down on Appendix A).

By including the updated options and s pending packages for Council’s consideration totaling $826,731 the net impact to the 2015 general operating budget would be $ 181,122, or a 0.65% increase, to the District’s budget. For the average home in Mission, this budget increase would represent an estimated $11.77 increase in property taxes. (See (B) bottom of Appendix A).

The budget impacts from collective bargaining with Canadian Union of Public Employees (CUPE) and the International Association of Fire Fighters (IAFF) or any other wage increases are not yet known therefore are not reflected in Appendix A at this time.

Staff continues to work with BC Assessment to get a firmer estimate of the value of additional property taxation revenue to be received from new construction. The final new construction revenue will be known by March 31, 2015.

SIGNOFFS:



Comments from Interim Chief Administrative Officer Reviewed. G:\FINANCE\MINUTES\2015\150120\(l) Memo Budget Status 2015 General Operating.docx

21

of 4

APPENDIX "A"

General Operating Fund Budget Summary Budget Dollars

Potential Tax Impact

Revenue Increases (-) or Decreases (+) Fees and Charges -34,491 $ -0.13%New construction/development revenue estimate (NCR) -340,000 -1.22% Includes unanticipated 2014 revenue of $90,000 New construction/development revenue estimate (NCR) -150,000 -0.53% January update from BC AssessmentAdministrative cost recovery -79,782 -0.29% Fully offset below by $176,540 increased transfer to reserveInvestment income (net of transfers to reserves) -24,453 -0.09%Grants in-lieu of taxes 4,500 0.02%

Total Revenue Increases over Prior Year -624,226 $ -2.24%Expenditure/Transfer to Reserve ChangesInterest savings from Debt Retired in 2013 -248,721 $ -0.89% Savings transferred to pavement managementIncrease in transfer to Roads Reserve Fund 248,721 0.89% Resulting from reduced interest costs aboveInterest savings from Debt Retired in 2014 -164,485 -0.59%Operational expenditures associated with new capital projects 6,650 0.02%Increase in insurance premiums 33,032 0.12% Includes the $19,000 for reduced deductibleSoftware licence for new electronic filing system 14,850 0.05%Restructuring in Engineering 45,113 0.16%West coast express train services and train bus 49,876 0.18% Includes train bus at $31,268Welton Plaza maintenance (Mission City Downtown Action Plan) 19,000 0.07%Various contractual increases 24,255 0.09%Legal costs for labour relations 22,500 0.08%Operating & replacement costs for new vehicles/replacement vehicles 28,652 0.10% 19 vehicles replaced or coming onlineBC Transit 43,886 0.16%Council indemnity (RC 14/297) 37,294 0.13%Career Firefighters - estimated rate increase 40,000 0.14% Estimate to bring wage level up to an estimate for 2014 wageSnow removal (3rd of 4 incremental increases) 50,000 0.18%Detailed departmental reviews (includes rate increases) 73,732 0.27%Corporate services resourcing changes 90,000 0.32% Offset by $90,000 included in the New Construction RevenueRCMP contract and integrated police services 268,200 0.96%

Total Expenditure Increases from Prior Year 682,555 $ 2.45%Budget updates Since January 20/15 ReportRemove Welton Plaza maintenance -19,000 $ -0.07%Converting annual awards ceremony to bi-annual event -7,500 -0.03%Remove transfer to Debt Retirement Reserve fund -521,820 -1.87%Removal of Manager Land Dev. & Property Mgmt from EDO -102,389 -0.37%

Subtotal Additional Budget Changes Since January 20 -650,709 $ -2.33%

Budget updates Since February 11/15 ReportAdmin cost recovery after Y/E & Capital Carry Forwards -53,229 -0.20%

Subtotal Additional Budget Changes Since January 20 -53,229 $ -0.20%

Subtotal - To Maintain Existing Services -645,609 $ -2.32% (A)

Proposed Options & Spending Packages for Council's Consideration (revised)A) Tax & Utility Clerk 37,000 $ 0.13%B) Purchasing Clerk 44,200 0.16%C) Recreation Youth Workers 38,300 0.14%D) Parks staffing 67,200 0.24%E) Fee for service grants 12,450 0.04%H) HR staff increase in hours 15,700 0.06%J) Manager of Environmental services 24,820 0.09% Portion funded by Waste MgmtK) RCMP Disclosure Clerk 14,605 0.05% Original proposal was $43,815L) RCMP Property Clerk 14,605 0.05% Original proposal was $43,815M) RCMP General duty officers (3) 405,000 1.45%N) 3% incremental increase in transfer to Legal Reserve Fund 448 0.00%O) 3% incremental increase to Information Systems Reserve Fund 2,532 0.01%P) 3% incremental increase to Insurance Reserve Fund 2,871 0.01%T) Assistant Fire Chief Fire Prevention / Emergeny Planning 132,000 0.47%U) Fire Fighter Training 15,000 0.05%

Subtotal of Proposed Options for Council's Consideration 826,731 $ 2.96%

Net Proposed Changes to General Operating Fund Budget 181,122 $ 0.65% (B)

Estimated $ Impact on Average Tax Notice - using average home value of $390,500 (2015)To Maintain Existing Services (645,609)$ -$42.03 (A)

Net Proposed Changes 181,122$ $11.77 (B)

22

Finance Department


Page 1 of 3





SUBJECT: 2015 Public Budget Consultation Information ATTACHMENT(S): Appendix A – It’s Your Business Proposed 2014 Budget Public Consultation

Appendix B – Public Consultation and Engagement

No staff recommendation accompanies this report; however, staff are requesting direction from Council as to what form the proposed 2015 budg et information is to take at a publ ic consultation meeting.

PURPOSE: The purpose of this report is to generate discussion and comments from Council for this year’s budget consultation presentation and t o provide an e xample of a p revious public budget consultation document.

BACKGROUND: The Community Charter Section 166 requires the local government to undertake the process of public consultation regarding the proposed financial plan before it is adopted by Council. This is an opportunity for the public to provide feedback to Council.

In the past, budget information in the form of a “Budget Highlights” brochure (see attached Appendix A for a copy of the 2014 brochure) was distributed throughout the community and a presentation was made at a R egular Council meeting. A t this meeting the public were encouraged to provide their comments to Council and District staff were in attendance and available to answer any questions that may come up.

In addition to the presentation, budget/financial information was put on the District’s website, an email address was activated to solicit comments, and a Comment Form was available that can filled out and returned.

Council would then discuss the public input from the various sources at a Freestanding Committee of the Whole (Corporate Services Committee - budget) meeting before making a final decision on the budget.

DISCUSSION AND ANALYSIS: As per the Community Charter requirement, the budget consultation meeting is scheduled for March 16, 2015. The following meeting March 30, 2015 is scheduled for Council to discuss the feedback and comments from the public prior to Council’s final budget decisions.

23


Council may wish to consider the strategy that is outlined in Appendix B to ensure citizens are engaged with the budgeting process and provide useful input to Council. This strategy consists of the following steps:

1) Re-launched budget website and prepare Budget Highlights brochure 2) Public consultation meeting presenting the budget (March 16) 3) Online and in-person survey (digital and paper-based) identifying priorities by demographic to

inform Council’s decision making process a. Online survey can be administered in-person via kiosk at specific locations b. Paper survey distributed through Mission Record

At today’s meeting, Council may wish to identify specific budget items to survey citizens for feedback to support decision making and consider the priorities or areas of focus for the survey.

FINANCIAL IMPLICATIONS: There are no financial implications associated with this report.

COMMUNICATION:

Staff will ensure copies of the Proposed 2015 Budget Consultation document is available on the District’s Website, in the main municipal hall lobby, and at the Leisure Centre. An advertisement will be placed in the Mission Record detailing the Public Consultation Meeting and where copies of the information are available.

SUMMARY AND CONCLUSION: The Community Charter Section 166 requires the local government to undertake the process of public consultation regarding the proposed financial plan before it is adopted by Council. This is an opportunity for the public to provide feedback to Council.

Appendix A is a c opy of the “Budget Highlights” brochure that was handed out at the 2014 publ ic consultation. A ppendix B outlines a s trategy for Council’s consideration for the 2015 publ ic consultation to ensure citizens are engaged with the budgeting process and provide useful input to Council. At today’s meeting, Council may wish to identify specific budget items to survey citizens for feedback to support decision making.

Staff are requesting direction from Council as to what form the proposed 2015 budget information is to take at a public consultation meeting

SIGN-OFFS:


Comment from the Interim Chief Administrative Officer: Reviewed

Reviewed by:

Michael Boronowski, Manager, Civic Engagement & Corporate Initiatives

G:\FINANCE\MINUTES\2015\150223\(3f) Budget Consultation Memo.docx

24

It’s Your Business

Proposed 2014 Budget

COMMUNITY CONSULTATION

Each year, Council aims to find a balance between affordable taxes for property

owners while still maintaining the services people have come to expect.

Where does the money come from?

Mission offers a broad range of services but

only has a few sources of revenue. The three

main operating revenue sources are: property

taxes, utility rates and user fees (e.g.

recreational fees, dog licenses, business

licenses, building permits etc.).

The District proactively reviews and adjusts

existing fees and charges and considers new

fees and charges on an annual basis.

Where does the money go?

The municipal budget of approximately

$64 million funds a variety of services for a

safe and healthy community.

Property Taxes48%

Utility Fees22%

User Fees & Other

Revenue 30%

Consolidated Operating Revenue

www.mission.ca

Water Utility10%

Sewer Utility8%

Waste Management

7%

Forestry Enterprise

6%

Protective Services

20%

Recreation9%

Administration8%

Transfer to Reserves

5%

Development Services

4%

Engineering & Public Works

12%

General Government

9%

Library2%

Consolidated Operating Expenses

*

* Includes: debt servicing, insurance, retirement accrual, etc.

The District of Mission

is a thriving, growing

municipality. With over

37,000 people that call

Mission home, the District

provides services,

facilities and infrastructure

that help make this

community one of the

most livable in the Fraser

Valley.

Did You Know?

The District’s total

operating budget is

$64 million.

The District has $44

million in its reserve

(savings) accounts.

Business Licenses

generate approximately

$280,000 worth of

revenue for the District.

The District received

$1.9 million in grants in

2012.

Appendix A 25

2

Getting to Zero

The District's expenditure

budget for the general

operating fund increased

by $687,205 between

2013 and 2014. These

increases have been

offset by additional

property tax revenue from

new construction and

increases to other revenue

to obtain a net zero

percent increase in the

property taxes.

Did you Know?

The District of Mission is

in a healthy financial

position. Council is

recommending a zero

percent increase for 2014,

on the heels of a zero

percent in year one of their

term (2012) and a modest

1.49% increase in year

two (2013).

For 2014, the General Operating fund showed a net increase in expenditures of $687,205, broken

down as:

Fire and Rescue Services $344,703 50.2% of the total

Policing Services $265,000 38.5% of the total

West Coast Express Train/Bus $155,244 22.6% of the total

Expenditure reductions $(77,742) -11.0% of the total

$687,205 100%

To help cover the increase in

expenditures of $687,205, the

District is expecting the following

revenues to increase:

What’s new for 2014?

What happened to the District’s expenses?

How is the District paying for the increase in costs?

The 2014 proposed budget has the same service levels with no increase to property taxes.

Each year, staff prepare spending packages

for Council’s consideration. These packages

include any new programs or services that are

not funded within the budget. For 2014,

Council approved two on-going operating

spending packages for inclusion into the 2014

draft budget.

$23,700 for Civic

Engagement, and

$2,100 for Human Resources

software annual fee.

In addition, Council approved three capital

initiatives to be added to the 2014 draft capital

budget.

Mission RCMP detachment cell retrofit

The 2014 projects on the MissionCity

Downtown Action Plan

Skylight replacement at the Leisure Centre

reception.

Funding to be determined for capital projects.

New programs for 2014

www.mission.ca

$687,205

2 Appendix A 26

3

Your annual tax notice

includes an amount for

municipal property taxes,

taxes levied by other

authorities (i.e. school board)

and a flat rate for municipal

utilities (water, sewer,

garbage, recycling/compost).

Mission ranks 4th

out of 13

neighbouring communities in

terms of the cost of property

taxes (excluding utilities) on

an average assessed home. (The average bill for Mission is $2,839.)

See how Mission compares with 13 of its neighbours above.

Did you know?

Since 2009, all newly built

homes connected to the

District’s water system have

a water meter installed and

are billed annually based on

consumption.

Mission residents who pay a

flat rate on their tax notice for

water, sewer, garbage and

recycling/compost curbside

pick-up pay about $92.50 per

month total for these

services.

By comparison, the average

home phone bill is $30/

month, cell phone is $60/

month, and BC Hydro is $55/

month.

How does Mission compare?

How much per month for municipal services?

Property taxes are the most

important source of revenue

for the District. The typical

property tax notice, that is

mailed out each May, also

includes taxes collected on

behalf of various taxing

authorities.

Depending on where you live,

your tax notice may include

charges for municipal utilities.

www.mission.ca

In 2013 the average home

in Mission paid $2,839 in

property taxes, with $1,754

of that amount for

municipal services.

Annual Monthly

Protective Services $525 $44

Engineering and Public Works 302 25

General Government 244 20

Parks, Recreation and Culture 223 19

Administration 204 17

Transfer to Reserves 144 12

Development Services 112 9

Municipal Taxes on average home: $1,754 $146*Includes debt servicing, insurance, retirement accrual, etc.

*

3 Appendix A 27

4

Operating and Capital

The District’s annual

operating budget is

used to pay for running

the various programs

and services it provides

to the community. For

example, the operating

budget includes the

money to pay staff that

repair the roads, as well

as the gas in their

vehicles; the lifeguards

at the Mission Leisure

Centre and the cost to

heat the pool.

The capital budget is

long-term. It establishes

the investment in

infrastructure, like road

reconstruction,

replacing aging water

and sewer pipes, or

replacing a fire truck.

The District plans to spend $6.6 million during 2014 as it continues to invest in the

maintenance of its transportation, drainage, water, sanitary sewer systems, and facilities.

Condition assessments on infrastructure helps the District prioritize replacement capital

projects within the financial plan.

Significant projects planned for 2014 include:

Ongoing road rehabilitation - $1.4 million

Ongoing AC (Asbestos Concrete) water main replacement - $1.0 million

Cannell Lake water treatment plant upgrades - $0.2 million

Norrish Creek water treatment plant membrane replacement - $0.3 million

Ongoing sewer condition assessment/replacement - $0.3 million

Highway #7 sewer main replacement Stave Lake St. to Mary St.- $0.3 million

Cleaning and repair of equipment at the JAMES Wastewater Treatment Plant -

$0.2 million

Capital projects planned for 2014

Utilities: the other part of the equation

www.mission.ca

4

$0

The 2014 proposed budget includes a 2% increase to your municipal water, sewer,

recycling/compost and garbage user fees to maintain the long-term health of these utility

operations.

For property owners paying the flat rate for these services, the annual charge is proposed to

be $1,131.

$0

Appendix A 28

5

The District began working on an early debt

retirement strategy in 2013 to pay down

existing external debt. This will allow the

municipality to free-up money for the

maintenance and replacement of existing

infrastructure, such as roads and sidewalks,

drainage systems, water and sewer utilities,

and other municipal facilities.

In the past five years, 2009 - 2013, the

District has reduced the total debt

outstanding by $7.7 million

Over the next three years, 2014 - 2016, the

District is planning to pay down the outstanding

debt another $7 million.

What do we owe?

What’s in the bank?

You told us...

2014 Budget Survey

651 responses received

Survey participants represent a broad range of age categories: 65% were 45 years+ 32% were between 18 - 44

50% of participants have lived in Mission 15 years or more

80% of respondents are not owners or operators of a business

The most important issue facing the District:

Downtown Revitalization Business & the

economy High property taxes

The top three priorities: A safe and secure

municipality A strong financial

position Infrastructure that is well

-maintained and sustainable

Survey participants are generally satisfied with District services

Services needing improvement:

Fire/Rescue Services Conditions of streets/

roads

Bylaw Enforcement Public Transit Snow removal

Suggestions to improve District services include: Downtown; Waterfront; Animal Control; Dog parks

For the full detailed

results from the 2014 Budget Survey - visit

www.mission.ca

Reserves are established to set aside money for future operating and capital expenditures.

In some cases, Council will set policy to decide how the money will be spent while other reserves

have restrictions.

Building up the District’s reserves will allow us to fund capital projects internally and avoid future

external borrowing and related interest charges.

The District will be debt free in the Water Utility by 2014 and

debt free in the Sewer Utility by 2016.

General Fund

$12,510,000

Water Utility

$380,000

Sewer Utility

$880,000

Consolidated External Debt

www.mission.ca

$-

$10,000,000

$20,000,000

$30,000,000

$40,000,000

$50,000,000

$60,000,000

$70,000,000

2014 2015 2016 2017 2018

Projected Reserve Fund Balances

Cemetery Trust Fund

DCC Reserves & RestrictedRevenues

Surplus

Reserve Funds$0

5 Appendix A 29

6

Council’s Goals and Objectives

In January of 2012, at the

beginning of their term,

Council adopted a

comprehensive strategic

plan that outlined their

goals and objectives for

the next three years.

This strategic plan is

used to focus limited

resources, as all new

initiatives and spending

must clearly be linked to

one of Council’s goals

and objectives before

being considered during

budget discussions.

Dates to remember

Tuesday, November 12 7 p.m. Council Chambers Town Hall Meeting with Mayor, MLAs and MP Monday, November 18 6 p.m. Council Chambers Budget Consultation Meeting Monday, December 2 6 p.m. Council Chambers Final Budget Discussions

Financial Sustainability

Undertook Core Services Review and

implemented results

Implemented Organizational Restructuring

and achieved major savings

Overall 0% tax increase in 2012, 1.49% tax

increase in 2013, and proposing an overall

0% tax increase for 2014

Forestry Operation now on a profitable course

Annual budget is now approved by December

31st of each year, prior to the start of the

fiscal year

Debt retirement program in place

Capital and operating reserves are being

built up

Infrastructure and Facilities Development Goals

Asset management position in place to help

prioritize infrastructure investments

Water main replacement plan now in place

Other infrastructure studies nearly complete

i.e. roads and sewer system

Water demand study completed

Second water source deferred based on water

conservation and management of regional

system

Economic Development

Additional funds provided for economic

development

New development bylaw drafted – awaiting

developer consultation results

Downtown Redevelopment Action Plan

completed and being implemented

Downtown Incentive Program is being

implemented to facilitate redevelopment in

the downtown core

Development process streamlined and related

policies and procedures have been reviewed

Municipal Operations and Partnership Goals

Financial budget projections, together with

performance measures, are presented three

times per year

Permissive Tax Exemption and Municipal

Partnership Fee-for-Service Grant policies

revised

BC Winter Games co-ordination and support

ongoing

Civic Engagement (webcast of Council

meetings, regular Town Hall Meetings, and

civic engagement programs)

How can you get involved?

Attend the Community Budget Consultation Meeting (Council Chambers on Monday,

November 18th starting at 6 pm)

Share your ideas for creative ways to save money, email your comments and/or questions

to [email protected]

It’s Your Business. It’s Your Municipality. It’s Your Budget. You can make a difference.

We hope this booklet has helped you to understand the District’s budget. We invite you to join us in creating a 2014 budget that reflects your priorities.

8645 Stave Lake Street, Mission, BC : 604-820-3700 : [email protected] / [email protected]

Accomplishing the Mission. . .

Appendix A 30


Appendix B Public Consultation and Engagement

A strategy for Council’s consideration is the following plan to ensure citizens are engaged with the budgeting process and provide useful input to Council. The goal of this effort is to obtain public feedback to support analysis and decision making, in keeping with the International Association for Public Participation (IAP2) standard for public participation.

1 Re-launched budget website and prepare Budget Highlights document 2 Public consultation meeting presenting the budget 3 Online and in-person survey (digital and paper-based) identifying priorities by demographic to inform

Council’s decision making process

a. Online survey can be administered b. Paper survey distributed through Mission Record

1) Re-launch and Promote Budget Website Updated content will be published to the budget section of the public website. Staff will then promote the re-launch online to drive traffic to the pages.

Updated content will include:

• Definitions and frequently asked questions to help residents understand the budget process • An email sign-up form to collect contact information to allow for promotion of a budget survey • Budget information and key considerations for review by the public.

2) Public Consultation Meeting, March 16, 2015 Staff will present the budget to the Public, providing an opportunity for the public to provide comments and ask questions.

3) Survey An online and in-person (both digital and paper-based) survey will be deployed to gather citizen input in the budget process. The online survey will be accessible on both desktop and mobile devices. An in-person digital survey will be available via iPad kiosk at the Leisure Centre and the Mission Library to provide additional points-of-contact.

The paper survey will be identical in terms of content, and will be delivered through the District’s city page in the Mission City Record.

A final report summarizing survey results and feedback will be provided to Council on March 30, 2015 and published on the public website to provide a feedback mechanism informing citizens of how their input was captured and used to inform the decision making process.

31

Finance Department







SUBJECT: 2015 Tax Rates and Tax Ratios ATTACHMENTS: Appendix “A” - Historical Municipal Tax Rates and Ratios

This report provides Council with the financial plan bylaw objectives and policies regarding the proportion of total revenue that comes from each of the funding sources described in Section 165(7) of the Community Charter; the distribution of property taxes among the property classes; and the use of permissive tax exemptions. This report is to solicit discussion and for Council to have the opportunity to provide staff with any wording changes that they would like to see in regards to the bylaw objectives and policies.

PURPOSE: The purpose of this report is to provide Council with the financial plan bylaw objectives and pol icies regarding the proportion of total revenue that comes from each of the funding sources described in Section 165(7) of the Community Charter; the distribution of property taxes among the property classes; and the use of permissive tax exemptions. Council has an opportunity to provide staff with any wording changes they would like to see in the bylaw objectives and policies.

BACKGROUND: Under section 165(3.1) of the Community Charter, the District of Mission is required to include in its Five-Year Financial Plan (2015 - 2019) bylaw 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; (revenue from property taxes, parcel taxes, fees, proceeds from borrowing and revenue from other sources)

2. The distribution of property taxes among the property classes; and 3. The use of permissive tax exemptions.

DISCUSSION AND ANALYSIS: Staff would like to provide Council with previous objective and policy wording that was used to fulfill the Community Charter’s requirements to solicit discussion and for Council to have the opportunity to provide staff with any wording changes that they would like to see in regards to these requirements.

Date: February 23, 2015 To: Mayor and Council From: Kerri Onken, Deputy Treasurer/Collector It was requested by the Committee at the February 11, 2015 Freestanding Committee of the Whole meeting, to bring this report back to the February 23, 2015 Freestanding Committee of the Whole meeting.

32


The 2014 to 2018 Financial Plan Bylaw objectives and policies are as follows: 1. Proportion of Total Revenue from Each of the Funding Sources

Council’s objectives and pol icies in regards to operating and capital revenue sources are provided below. Table 1 highlights the various operating and capital revenue sources, including the percentage from each source, reflected in the District’s Five-Year Financial Plan (2014 - 2018). On average, over the five years, about 49% of operating revenues will come from property taxes with user fees making up the other significant portion averaging 45%. The majority of capital funding is intended to come from the District’s internal reserves and from development cost charges (DCCs).

Operating Revenue Sources

Objective: Over the five-year financial plan timeframe, it is Council’s goal to diversify and ex pand its revenue base as much as possible with the goal of becoming less reliant on property taxes.

Policy: Council recognizes that the District of Mission is reliant on property taxes to fund the majority of its services/programs; however, Council is committed on an annual basis to formally reviewing and adjusting, where possible, existing user fees and to examining and implementing new user fees where feasible, in order to minimize overall property tax increases. Council also recognizes that raising user fees beyond a certain point will actually result in less usage or demand and ultimately less revenue and that various services like recreation need to be subsidized to a certain level so that all citizens can partake. The District of Mission, like other local governments in B.C., also needs access to other sources of revenue to meet growing service demands and to stabilize property taxes.

Capital Revenue Sources

Objective:

Over the five-year financial plan timeframe, it is Council’s goal to build up its reserves to provide for greater internal capital funding/financing opportunities.

Policy:

Council sees the need t o increase its internal capital funding capacity by building up i ts own reserves, to minimize future external debt/interest costs and t o provide internal borrowing opportunities. Internal debt financing for capital projects should be utilized to the extent possible before resorting to external debt with the proviso that internal debt repayments need t o take place as scheduled; however, external debt financing may be required for larger, high priority capital projects if sufficient reserves are not in place.

33


2. Distribution of Property Taxes

Council’s objective and policy in regards to the distribution of property taxes are provided below. Table 2 highlights the estimated municipal property tax dollars and the respective percentages to be collected from each of the tax classes in 2014. The District collects approximately 75% of its property taxes from the residential class and about 21% from the business/other class with the other classes making up the balance. This is reflective of the fact that about 90% of Mission’s assessment base is residential and about 8% is business/other.

Objective:

Over the five-year financial plan timeframe, it is Council’s goal to diversify and expand its tax base so that all taxpayers are better off.

Policy:

Council recognizes the need to rationalize its property tax distribution among the various tax classes; however, more importantly Council recognizes the need to diversify and expand its assessment/tax base. Council is committed to aggressively pursuing business/commercial economic development opportunities to achieve this. Council is also committed to comparing its

2014 2015 2016 2017 2018

Operating Revenue SourcesProperty value taxation 48.55% 48.83% 49.13% 49.47% 49.78%

Parcel tax 0.11% 0.08% 0.08% 0.07% 0.07%

User fees and charges 44.56% 44.67% 44.32% 44.00% 43.67%

Other revenue 6.78% 6.42% 6.46% 6.46% 6.47%

Proceeds from borrowing 0.00% 0.00% 0.00% 0.00% 0.00%

Totals 100.00% 100.00% 100.00% 100.00% 100.00%

Capital Revenue sourcesOther sources - Reserves 55.66% 59.66% 55.12% 68.41% 41.47%

42.62% 40.34% 44.88% 31.59% 58.53%

Other sources - Grants 1.73% 0.00% 0.00% 0.00% 0.00%

Proceeds from borrowing 0.00% 0.00% 0.00% 0.00% 0.00%

Totals 100.00% 100.00% 100.00% 100.00% 100.00%

Other sources - DCCs and developer contributions

Table 1: Sources of Revenue

34


assessment mix, property tax levels and property tax distribution with other B.C. communities on an annual basis. Council understands that the level of property taxation for each of the tax classes does not necessarily correlate with the amount of services provided; however, quantifying and costing the services provided to each tax class is difficult and subjective at the very least. It should also be recognized that many businesses in the community have employees that benefit from and us e many District services, facilities and am enities, and t hat additional services and amenities benefit all of the tax classes, both directly and indirectly.

Table 2 approximated the 2014 distribution of property taxes based on the 2013 distribution as the financial plan bylaw for 2014 to 2018 was adopted in December, 2013.

The attached Appendix “A” summarizes the past five years’ municipal tax rates, the percentage of property tax collected by each class and ratio of each class to Residential.

3. Permissive Tax Exemptions (including Revitalization Tax Exemptions)

Council’s objective and policy in regards to permissive tax exemptions (including revitalization tax exemptions) are provided below.

Objective:

Over the five-year financial plan timeframe, Council will continue supporting worthy charitable/non-profit organizations that provide valuable services to the community and will determine how it can use its expanded powers in terms of revitalization tax exemptions to benefit the community as a whole.

Table 2: Approximate Distribution of 2014 Property Taxes

Property Class Property Tax Dollars Raised

% of Total Property Taxation

(1) Residential 20,711,345 74.51%

(2) Utility 233,493 0.84%

(3) Social Housing - 0.00%

(4) Major Industry - 0.00%

(5) Light Industrial 942,309 3.39%

(6) Business/Other 5,723,347 20.59%

(7) Municipal Forest 2,780 0.01%

(8) Recreation/Non Profit 125,085 0.45%

(9) Farm 58,373 0.21%

27,796,732$ 100.00%

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Policy:

Council chooses to support charitable/non-profit organizations (churches, social, recreational, health and hous ing organizations) that provide valuable services to the community through permissive tax exemptions as allowed for by legislation. Council is committed to continuing with these tax exemptions and t o treating all organizations with similar mandates equally when it comes to property tax exemptions. Council also plans to closely examine its expanded powers in terms of allowing certain business and related business activities revitalization tax exemptions under the Community Charter, and in this regard implement policies that benefit the community as a whole

FINANCIAL IMPLICATIONS: There are no direct financial implications associated with this report, only those associated with the budget.

COMMUNICATION: No communication action is required.

SUMMARY AND CONCLUSION: Staff have provided Council with previous objective and pol icy wording for the financial plan bylaw objectives and policies regarding the proportion of total revenue that comes from each of the funding sources described in Section 165(7) of the Community Charter; the distribution of property taxes among the property classes; and the use of permissive tax exemptions. This information is to solicit discussion and for Council to have the opportunity to provide staff with any wording changes that they would like to see in regards to these requirements.

SIGN-OFFS:



Comment from Chief Administrative Officer Reviewed.

\\Maverick\Data\FINANCE\MINUTES\2015\150211\(1) Tax Rates and Ratios Report.docx

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Appendix “A”


The municipal rates in the chart above represent the total of “Municipal – General” and “Municipal – Policing” as shown on the property tax notice.

District of MissionHistorical Municipal Tax Rates and Ratios(not including special levies)

2010 2011 2012 2013 2014Property Class Municipal

Rates% Taxes Raised

RatiosMunicipal

Rates% Taxes Raised

RatiosMunicipal

Rates% Taxes Raised

RatiosMunicipal

Rates% Taxes Raised

RatiosMunicipal

Rates% Taxes Raised

Ratios

Residential 4.3734 75.76% 1.000 4.3867 75.81% 1.000 4.4200 75.29% 1.000 4.4761 74.51% 1.000 4.6388 73.99% 1.000Utilities 40.1807 0.79% 9.188 41.9291 0.81% 9.558 40.5600 0.83% 9.176 41.2844 0.84% 9.223 40.3605 0.84% 8.701Supportive Housing 4.3734 0.00% 1.000 4.3867 0.00% 1.000 4.4200 0.00% 1.000 4.4761 0.00% 1.000 4.6388 0.00% 1.000Major Industry 12.5951 0.00% 2.880 12.6290 0.00% 2.879 12.7400 0.00% 2.882 13.0367 0.00% 2.913 13.0564 0.00% 2.815Light Industry 12.5951 3.17% 2.880 12.6290 3.25% 2.879 12.7400 3.33% 2.882 13.0367 3.39% 2.913 13.0564 3.34% 2.815Business/Other 13.8554 19.56% 3.168 14.4583 19.41% 3.296 13.9900 19.86% 3.165 14.2360 20.59% 3.180 13.9174 21.10% 3.000Managed Forest 7.8125 0.00% 1.786 8.7753 0.00% 2.000 9.4900 0.01% 2.147 10.0970 0.01% 2.256 10.7883 0.02% 2.326Recreational/NonProfit 9.4849 0.49% 2.169 9.7497 0.49% 2.223 9.7000 0.46% 2.195 10.0834 0.45% 2.253 10.3055 0.49% 2.222Farm 19.3064 0.23% 4.415 19.2387 0.23% 4.386 19.2100 0.22% 4.346 19.3338 0.21% 4.319 19.1815 0.22% 4.135

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committee of the whole agenda · 2019-11-22 · committee of the whole agenda. the agenda for the ....

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