2016 Operating Budget Overview

Transcription

1 Overview Committee of the Whole February 17, 2016

2 Agenda Opening Remarks Towards Financial Strength Impact of 2016 Budget Next Steps 2

3 Opening Remarks

4 Opening Remarks Council Leadership 2016 Community Strategic Plan Willing to make the difficult decisions Staff Responsiveness Customer service and responding to community needs Multi-year approach to dealing with the challenges ahead This is our recommendation to you Acknowledgements 4

5 Towards Financial Strength & Sustainability

6 The Path Forward Towards Financial Strength 2015 : Stabilize the operating base : Provide for infrastructure needs Develop multi-year capital program Start to move towards pay-as-you-go capital financing Address adequacy and funding of reserves 2018 onwards : Strategic Investments 6

7 Towards Financial Strength Stabilizing The Operating Base Address 2014 operating deficit Budget adequate resources Standardize account usage Understanding the real cost of services Quarterly variance reporting Increased financial reporting to Council Deal with long-standing financial issues Provide for tax stabilization and emergencies 7

8 Towards Financial Strength Stabilizing the Operating Base Ensures important activities are adequately resourced Enables staff to: take responsibility for financial management do the right thing and to do things right be flexible and innovative in responding to community needs focus on outputs, i.e. what is the value of this service/activity to the community? Provides for emergencies and one-off situations so they are not pressures on day-to-day operations 8

9 Towards Financial Strength Provide For Infrastructure Needs Understand facilities/infrastructure challenges Hands-on capital budget/project management Quarterly variance reporting Capital Financing integrated into Operating Budget Develop Multi-Year Capital Plan Establish funding stream for Capital Projects Town-wide Asset Management Plan Integrate into the Multi-Year Capital Plan 9

10 Towards Financial Strength Provide for Infrastructure Needs 2015 experience confirmed infrastructure gap Three year capital plan and financing approved in principle by Council in November 2015 includes: 3% increase to the tax levy contribution to capital reserves 2% for repayment of funds borrowed for 2015 Capital projects Town-wide Asset Management Plan, and accompanying Financing Plan, to be developed in 2016 Multi-Year Plan will be updated to reflect results 10

11 Strategic Investments Towards Financial Strength Putting the Town on a strong financial footing is a strategic investment Senior staff actively looking at strategic opportunities and synergies to revitalize the Town economy and well-being Short to medium term focus on core financial strength and fiscal sustainability Does not preclude initiatives linked to the 2016 Community Strategic Plan May need operational realignment or service reductions 11

12 2015 Results Projected 2015 year-end surplus of approximately $350,000 or just under 3% reflects savings as a result of a good winter season and tight management of budgets 3-5% operating surplus considered prudent Projected 2015 surplus will be used to: Towards Financial Strength Eliminate the streetlight deficit (reported to Council in May 2015) Start up an allowance for taxes to be written off from assessment at risk (reported to Council in October 2015) Create a tax stabilization fund for future operating pressures e.g. forest fires or an exceptional winter 12

13 In Summary There IS a long term financial plan The Town has made excellent progress in the last 12 months and is on track to achieve its goals The is the next step in moving forward with this plan This budget reflects the need to provide adequate financing for asset replacement and repair Towards Financial Strength Operating needs have been held in check for

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15 The Is Evolving In Order To Provide. Transparency and Clarity consistent use of account codes like consulting services and contracted services budgets better aligned to reflect operational needs Better information inclusion of the 2014 actuals in the template providing 3 years of data Linkages of 2016 Goals to the recently approved Community Strategic Plan 15

16 Significant Changes in the 2016 Operating Budget 2016 tax levy funding for Capital ($1.2 million) has been consolidated in the Corporate Administration budget in Transfers to Capital Reserves Fleet costs and recoveries are included in the 2016 budget ($850,000 in gross costs) for the first time Urban Street Light Levy discontinued. The cost of $252,500 in 2016 will be borne by the General Levy Supplementary Taxes ($100,000) and Tax Write-Offs ($100,000) are budgeted for the first time 16

17 4% 5% 5% 7% Gross Expenditures $19 million 2% 2% 2% 2% 3% Staff Costs - $7.8 million Repayment of Debt - $3.1 million 3% Transfers to Reserve - $1.6 million Contracted Services - $1.4 million Materials & Equipment - $1.0 million 41% Utilities - $ 0.9 million Fleet/Equip Charges - $0.7 million Mgmt/Perform Fees - $0.6 million Insurance - $0.5 million Information Technology - $0.4 million Communications - $0.3 million 8% Consulting & Legal - $0.3 million Other - $0.4 million 16% 17

18 Gross Revenues $19 million 2% 2% 2% 2% 2% 3% 3% 4% Property Taxes - $13.4 million Federal/Provincial Grants - $1.8 million Fleet Recoveries - $0.9 million Tax Penalties & Interest - $0.5 million 9% Facility/Arena Rentals - $0.5 million Building & Other Permits - $0.5 million Planning & Other Fees - $0.4 million 71% Cost Recovery from YMCA - $0.3 million Opera House Sales - $0.3 million Other - $0.4 million 18

19 Developing the Departments asked to budget for their needs with some sensitivity to the capital pressures First cut budget reflected a 10.4% tax increase 5.0% for capital (as presented to Council in November 2015) 5.4% requested for operations CAO/Treasurer reviews with department heads resulted in a 50% cut in the requested increase for operations in light of the capital pressures Recommended budget is up 7.7% from

20 Highlights Gross expenditures of $19 million pay for all day-to-day Town services, debt repayment and contributions towards the Town Capital Budget Tax revenues of $13.4 million cover 71% of these costs. The rest comes from Town revenues and grants 1% increase in taxes = $124,744 The 2016 Net Budget increase is $965,460 or 7.7% $625,900 for Capital related costs (5.0%) $339,560 for Operations (2.7%) 20

21 TOWN OF GRAVENHURST Recommended 2016 Net Operating Budget $ Change from % Change from NET BUDGET BY DEPARTMENT Actuals YTD Budget Recommended Actuals Budget Budget Budget Council 231, , , ,650 1, % CAO & Human Resources 479, , , ,730 30, % Legislative Services (Clerks) 314, , , ,470 13, % Corporate Services (Finance) 494, , , ,100 19, % Corporate Administration* (341,302) 166, , , , % Development Services 842, , , ,366 32, % Econ. Dev. & Communications 411, , , ,002 64, % Fire & Emergency Services 862, , , ,107 13, % Gravenhurst B.I.A. 46,912 44,634 48,576 48, % Gravenhurst Public Library Board 491, , , ,450 22, % Infrastructure Services 6,952,431 6,725,091 6,847,427 6,969, , % Recreation, Arts & Culture 1,006,661 1,048,273 1,050,708 1,058,269 7, % Town of Gravenhurst 11,793,921 12,120,837 12,474,389 13,439, , % * 2014 Actuals adjusted to include $452,500 for capital levy. 21

22 2016 Net Operating Budget Increases Corporate Administration Infrastructure Services Econ Dev & Communications Development Services CAO & Human Resources Gravenhurst Public Library Board Corporate Services (Finance) Fire & Emergency Services Legislative Services (Clerks) Recreation, Arts & Culture Council Gravenhurst B.I.A. $0 $64,634 $30,610 $22,191 $19,277 $13,653 $1,900 $637,290 $32,050 $13,854 $7,561 $625,900 impact of Capital $122,440 22

23 Key Drivers of 7.7% Increase Impact of Capital ($625,900): 5.0% 3% levy increase for capital 2% to repay funds borrowed for 2015 Capital Budget New Initiatives ($123,000): 1.0% Provision for Assessment at Risk Decorative Christmas lights (downtown) Special projects + 10% increase to CIP grant Operations ($216,560): 1.7% Wage increases approved by Council Loss of grants for 2 positions in Economic Development Phase II of Opera House strategic plan implementation Multiple staffing adjustments including hire of new C.A.O. Nominal cost increases across-the-board Savings from restructuring in RAC and Infrastructure Services Increase in 2016 Ontario Municipal Partnership (OMPF) grant 23

24 Impact of

25 Impact of Impact of Town Budget Increase What does a 7.7% Town budget increase mean? Town share of tax bill will increase on average by $21.40 per $100,000 of assessment. This is $46 on a median residential property valued at $215,000. As a result of the elimination of the Urban Street Light levy some bills will be lower and some bills will be higher Properties that previously paid the Urban Street Light levy will see a reduction of $18 per $100,000 of assessment. Properties that did not pay the Urban Street Light levy will see an increase of $7 per $100,000 of assessment. This is a one-time adjustment to spread the cost of the street lights over the total tax base as approved by Council September

26 Impact of Change to Residential Tax Bill Only 43% of a rural Town of Gravenhurst property tax bill and 33% of an urban Town of Gravenhurst property tax bill comes to the Town. The balance of the tax bill is for taxes payable to the District of Muskoka and the School Boards. The total Gravenhurst residential tax bill will increase between 1% and 4% in This includes: 7.7% Gravenhurst budget increase adjusted for the removal of the Urban Street Light levy Increases to District general, water and sewer levies No School Board increase 26

27 Impact of Share of Property Tax Bill for home assessed at $215,000 $752 $419 Education Gravenhurst $886 District Rural $419 Education Note: Rural properties do not pay District water and sewer levies $1,370 $886 Gravenhurst District Urban 27

28 Next Steps

29 Next Steps Council Consideration of Review the budget package tabled today Questions/clarifications may be directed to the CAO and Director of Corporate Services/Treasurer Preferably by February 24 to allow sufficient time for staff to prepare responses for department budget reviews March 1 and 2 Council Budget review process: Department presentations: March 1, 2 Delegations and public comments: March 5 Approval of : March 10 29

30 Next Steps Department Head presentations to Council Tuesday, March 1 Wednesday, March 2 Council CAO & H.R. Services Legislative Services Corporate Services Gravenhurst B.I.A. Gravenhurst Public Library Board Infrastructure Services Recreation, Arts & Culture Corporate Administration Development Services Economic Development & Communications Fire & Emergency Services 30

31 Conclusion