E mail Tweet or #LdnBudget

Transcription

1 1

2 Stay in Touch E mail budget@london.ca Tweet or #LdnBudget Find us on Call Financial Planning & Policy at Watch budget meetings streaming live at 2

3 Budgets Tabled Property Tax Supported Water Wastewater

4 Residential How do we Compare? $377 below group average 2015 Group Average: $ 3,583 (2014 $ 3,530) 2015 City of London: $ 3,206 (2014 $ 3,151) 4

5 Commercial How do we Compare? 2015 Property Tax - Commercial (for Municipalities with Populations over 100,000) $6.00 For prime location commercial office space, property taxes per sq ft of gross leaseable area (Source: BMA - Municipal Study 2015) $5.00 $4.00 $3.00 $2.00 $1.00 $ Group Average: $ 3.37/sq. ft (2014 $ 3.36/sq. ft) 2015 City of London: $ 2.36/sq. ft (2014 $ 2.32/sq. ft) 5

6 Industrial How do we Compare? 2015 Property Tax - Industrial (for Municipalities with Populations over 100,000) For standard industrial property under 125,000 sq ft, newer construction, flexible design - taxes per sq ft of floor area basis (Source: BMA - Municipal Study 2015) $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $ Group Average: $ 2.05/sq. ft (2014 $ 2.09/sq. ft) 2015 City of London: $ 1.30/sq. ft (2014 $ 1.39/sq. ft) 6

7 The Budget Components Service Review Base Budget Base Minimal Budget changes to existing services and programs Strategic Initiatives (Business Cases Pgs ) Cost Pressures Summary Pgs

8 Budget 3.5% 3.1% Potential Average Annual increase 0.4% 0.7% 0.7% 0.4% Potential Service Review Savings 2.9% Average annual target (upper limit) 2.6% Average Annual increase (Base budget starting point) 0% 2.5% 2.6% 2.6% 2.7% Consider the average impact over the four years Stick to financial principles Take a measured approach to reductions to base Carefully consider pace of strategic initiatives 8

9 Multi Year Budget Key Considerations RECOMMENDED By Administration For CONSIDERATION By Council POTENTIAL Tax Levy Key Consideration 1: Base Budget Key Consideration 2: Strategic Investments Requested Tax Levy From Rates Avg. Annual Increase Of 2.6% or $14.0 million Avg. Annual Increase Of 0.5% or $3.0 million Avg. Annual Increase Of 3.1% or $17.0 million 9

10 Base Budget Cost Drivers Category Average Annual Net Inc / (Dec) $millions Average Annual Tax Levy Impact Capital Financing and Other Related Financing % Civic Service Areas % Upload Of Ontario Works (2.1) (0.4)% Agencies, Boards & Commissions % TOTAL % 10

11 Key Consideration #2: Strategic Investments Included in the requested budget for Council s consideration 23 business cases Total gross expenditure investment of $53.1 million ( ) Average annual tax impact of 0.5% or $3.0 million per year Other sources of funding include: reserve funds, London Hydro dividend, debt, and other government funding. 11

12 Budget

13 Budget Terminology Operating Budget The City s plan for expected revenue and expenditures based on the City s daily activities. Capital Budget The City s plan for long-term financing of fixed assets. 13

14 Budget Terminology Property Tax Levy The tax bill paid by homeowners and businesses for owning real estate. This revenue is used to fund programs and services for the entire community. Funding from Assessment Growth Additional revenue that is collected through property taxes due to a growing and expanding city. Tax Levy from Rates Property taxes collected from existing homeowners and businesses. 14

15 Budget Terminology User Fee Revenue Fees imposed on services intended to recover all or part of the cost associated with providing the service. Pay-as-you-go Financing The principle of funding capital projects with current funds rather than relying on debt financing. 15

16 Budget Terminology Reserve Fund A Reserve Fund is an amount set aside for a specific purpose that is carried from year to year unless consumed or formally closed. Reserves Reserves are also amounts carried from year to year, but reserves are set up and used as cushions against operating budget contingencies or unforeseen events. 16

17 Balanced Budget Revenues = Expenditures + Non-Property Tax Revenues (User fees and Grants) Tax Levy=Property Taxes collected From Assessment Growth From Tax Rate Increase 17

18 Balancing the Budget BASE BUDGET SERVICE GROWTH Current Services & Service Levels What Exists + Cost of Business Labour Materials Regulation + Expanding City New homes New businesses More of Same! + Service Changes New Services Higher Svc Levels = OTHER REVENUE: USER FEES, GRANTS, LICENSES, ETC PROPERTY TAX FROMASSESSMENT GROWTH Expenditure Requirements ONE TIME REVENUE (DEFERRAL) RESERVE FUNDS PROPERTY TAX FROMRATE INCREASE EXISTING TAX LEVY, USER FEES, GRANTS, ETC 18

19 The Budget Process Business Plan including KPI s 4 Year Average Tax Levy Target Set by Council (between 2.2% and 2.9%) Base Budget Maintain the existing Services Cost Pressures Demands Upload Contingency Strategic Investment Business Cases for Council s top strategic priorities (new/expanded services) On going revenue and operating/maintenance costs Initial capital investment Service Review Assessment Growth Policy Annual Surplus Policy Significant Events New Provincial Regulation New Council Direction Areas significantly over target Update Business Plan with new MYB Information Annual Progress Updates 2016 Mar Budget (Multi Year Budget [MYB]) 2017 Dec / Dec /17 Annual Update 2019 Mar/19 19

20 Short Video qnfbo 20

21 Stay in Touch E mail budget@london.ca Tweet or #LdnBudget Find us on Call Financial Planning & Policy at Watch budget meetings streaming live at 21