Town of Rocky Mountain House: Offsite Levy Review

Transcription

1 Town of Rocky Mountain House: Offsite Levy Review Version 6 October 25 th, 2016 Presented to: Todd Becker, CAO Town of Rocky Mountain House PO Box 1509 Rocky Mountain House AB T4T 1B2 (403) tbecker@rockymtnhouse.com Prepared by: Greg Weiss, President Avenue Edmonton, AB T6C 2A4 (780) gweiss@corvusbusinessadvisors.com This document has been prepared by for the sole purpose and exclusive use of the Town of Rocky Mountain House.

2 October 25 th, 2016 Todd Becker, CAO Town of Rocky Mountain House PO Box 1509 Rocky Mountain House AB T4T 1B2 RE: Town of Rocky Mountain House Offsite Levy Review Todd: Enclosed is our report for the offsite levy review project. If you have any questions do not hesitate to contact me. Yours truly, Greg Weiss President Inc Avenue Edmonton Alberta T6C 2A

3 1 DOCUMENT INFORMATION Version Number Revision Date Summary of Changes and Author 1.0 February 11 th, 2015 Created by. 2.0 March 9 th, 2016 Created by. 3.0 March 17 th, 2016 Reviewed by Town staff. 4.0 June 28 th, 2016 Town amended capital plan details. 5.0 October 3 rd, 2016 Town amended expenditure details. Town amended historical offsite levy collections. 6.0 October 25 th, 2016 Town amended allocations to benefitting areas. Version 6 October 25 th, 2016 / i

4 2 CONTENTS 1 DOCUMENT INFORMATION... I 2 CONTENTS... II 3 INTRODUCTION INTRODUCTION METHODOLOGY KEY FINDINGS RATES RECOMMENDATIONS ACKNOWLEDGEMENTS DISCLAIMER... 6 APPENDIX A: OFFSITE LEVY AREAS AND STAGING... 7 APPENDIX B: TRANSPORTATION OFFSITE INFRASTRUCTURE APPENDIX C: WATER OFFSITE INFRASTRUCTURE APPENDIX D: SANITARY OFFSITE INFRASTRUCTURE APPENDIX E: BENCHMARK COMPARISONS APPENDIX F: HISTORICAL COLLECTIONS & RECONCILIATION Version 6 October 25 th, 2016 / ii

5 3 INTRODUCTION 3.1 Introduction The Town wishes to facilitate growth of the community by providing offsite transportation, water, and sanitary infrastructure that meets the needs of development, and also ensure that accompanying charges are fair and equitable, comply with legislative and regulatory requirements, and recover the cost of the infrastructure in order to ensure a financially sustainable community 1. In April 2014 the Town of Rocky Mountain House retained the Team to assist in updating its offsite levy rates. As part of this project, the Town is implementing the CORVUS offsite levy model for managing rates ongoing. This report outlines the methodology and information used in establishing transportation, water, and sanitary offsite levy rates for the Town of Rocky Mounty House. 3.2 Methodology The Town of Rocky Mountain House has created various infrastructure master plans, and these plans have been used as key inputs into this offsite levy rate review. Town staff and its engineering advisors reviewed existing plans and identified offsite projects for transportation, water, and sanitary infrastructure including completed projects (carried forward from previous bylaws) and future projects required to support growth 2. Each project was assessed for benefiting areas using the offsite levy areas identified in this report. The Town s assessment also included determination of benefits to existing development and future development. Support provided by included: Provision of the most current CORVUS offsite levy model, including configuration, priming, and data loading. Facilitation of a workshop to determine offsite levy area boundaries. Incorporation of offsite levy area measurements and land development forecasts (provided by Town planning staff). Incorporation of infrastructure costs and allocation percentages for existing development, new development, and other parties (provided by the Town s engineering advisors and Town staff). Incorporation of project expenditures for completed and in-progress projects (provided by the Town s finance staff). 1 The scope of this project does not include stormwater infrastructure. All stormwater infrastructure is treated by the Town as onsite infrastructure. Should the Town plan to construct offsite stormwater infrastructure in the future, it can be added to the model during one of the annual rate and bylaw amendments. 2 It was not within CORVUS scope of work to review the Town s master plans. Version 6 October 25 th, 2016 / 1

6 Establishment of offsite levy reserve opening balances including front-ending balances (amounts owed by future development to the Town for construction of infrastructure on behalf of future development). Development of transportation, water, sanitary, and stormwater offsite levy rates for each offsite levy area. Presentation of offsite levy rates and background information to Administration and Council. Offsite levy rates are forecast using a rolling 25-year review period. During this review, a cutoff date of December 31 st, 2015 was established, and so the review period stems from 2016 to Costs that benefit development prior to and within the review period are included in rates. Costs that benefit development beyond the review period (called financial oversizing ) are excluded from rates. In future years, when rates are updated and the rolling 25-year period moves further out, development costs beyond 2040 will gradually find their way into rates. The cut-off date (December 31 st, 2015) coincides with the Town s most recent year-end. Project expenditures, offsite levy receipts etc. were gathered as actuals from the Town s financial records up to the cut-off date. Beyond the cut-off date, all financial details are estimates. When the Town completes its next rate update, information from January 1 st, 2016 up to the new cut-off date will be converted from estimates to actuals. 4 KEY FINDINGS Key findings pertaining to the establishment of Town offsite levy rates are as follows: Offsite infrastructure costs to be included in the offsite levy bylaw totals approximately $95.46 million. An overview of offsite infrastructure costs and maps is provided in Appendices B1, C1, and D1. Offsite infrastructure costs are always reduced by special ear-marked grants and development contributions. An overview of grants and contributions and resulting net costs is provided in Appendices B2, C2, and D2. Financial oversizing (the amount of cost which is allocated to future development beyond the 25-year review period) is based on the anticipated year of construction. An overview of construction staging is provided in Appendices B3, C3, and D3. That portion of cost which is allocated to future development versus existing development and other allocations is provided in Appendices B4, C4, and D4. Before allocating infrastructure costs to lands, offsite levy costs must be reduced by amounts collected to date. An overview of offsite levy collected is provided in Appendices B5, C5, and D5. Of the $95.46 million in total offsite infrastructure costs, the developer share included in rates today is $14.49 million. A complete summary of offsite infrastructure net cost flow-thru is provided in Appendices B6, C6, and D6. Version 6 October 25 th, 2016 / 2

7 An overview of offsite infrastructure benefitting areas is provided in B7, C7, and D7. Summary of Infrastructure Costs & Allocations Front-ending balances represent monies owed by future development to the Town for construction of infrastructure undertaken by the Town on behalf of future development. During this review, it was determined that front-ending balances for all infrastructure are approximately $5.38 million as at December 31 st, This balance assumes a portion of the debt has been repaid using the cash currently available in the offsite levy reserve. An increase in front-ending amounts puts upward pressure on offsite levy rates. Front-ending balances and reserve balances are provided in Appendix B8, C8, and D8. Note, the Town has not accounted for front-ending balances in current reserve balances, financial statements, or internal documentation. The front-ending balances shown in this report assume that excess funds have been withdrawn in order to pay down a portion of the debt. This is discussed further in Section 6. The Town is parsed into several offsite levy areas. The area boundaries, numbering schema, and area measurements are described in Appendix A along with an offsite levy map. To calculate offsite levy rates, it is necessary to forecast the amount of land that will develop during the 25-year review period. Land development forms the denominator of the rate calculation. A larger denominator reduces rates, but could potentially result in under-collection and an increased burden for tax payers. A smaller denominator increases rates, but could potentially result in over-collection and an increased burden for future development. Accordingly, land development forecasts need to be (a) reasonable, and (b) updated annually to reflect the changing pace of development in the community. For this review, the Town is forecasting development of approximately 153 ha. over the 25-year review period (approximately 6.3 ha. per year on average). The land development forecast is shown in Appendix A. Offsite levy reserves/accounts are impacted by interest. When reserves/accounts are in a positive balance they earn interest (as required by the MGA). When reserves/accounts are in a negative position, this indicates that front-ending is being undertaken on behalf of the reserve/account. Front-ending parties are eligible for interest on their balances. As such, reserves/accounts are charged interest when in a negative position. An overview of reserve/account interest rates and forecast balances over the 25-year review period is shown in Appendices B9, C9, and D9. Version 6 October 25 th, 2016 / 3

8 5 RATES The offsite levy rate is $79,511 per net hectare as shown in table below. Though this is a substantive increase from current rates 3, it is important to remember that current rates are out-of-date and do not reflect the full cost of all projects that will be included in the Town s amended bylaw. The Town s updated offsite levy rates are comparable to other municipalities of similar size in Alberta (a comparison of rates to other municipalities is outlined in Appendix E). Most importantly, these rates reflect the actual cost of infrastructure required to facilitate development in the Town of Rocky Mountain House. Summary of Offsite Levies by Area Area Ref. # Transportation Charges Water Charges Sanitary Charges Total 1 $ 16,419 $ 40,178 $ 22,914 $ 79,511 2 $ 16,419 $ 40,178 $ 22,914 $ 79,511 3 $ 16,419 $ 40,178 $ 22,914 $ 79,511 4 $ 16,419 $ 40,178 $ 22,914 $ 79,511 5 $ 16,419 $ 40,178 $ 22,914 $ 79,511 6 $ 16,419 $ 40,178 $ 22,914 $ 79,511 7 $ 16,419 $ 40,178 $ 22,914 $ 79,511 8 $ 16,419 $ 40,178 $ 22,914 $ 79,511 9 $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79, $ 16,419 $ 40,178 $ 22,914 $ 79,511 6 RECOMMENDATIONS CORVUS recommends the following: 3 The Town s current rates are approximately $34,150 per net ha. (2004 dollars). Adjusted for inflation, this results in a current rate of ~$49,000 (2016 dollars). Version 6 October 25 th, 2016 / 4

9 1. Implement the updated full cost rates outlined in Section 5. The quicker the Town completes the bylaw amendment, the quicker it can remove the inherent subsidization tax payers are affording development today. 2. Ensure the bylaw reflects the requirement for an annual update of offsite levy rates and delivery of an annual update report to Council. In addition to enabling compliance with MGA requirements, regular updates ensure offsite levy rates do not decay, and Council is apprised regularly of the status of changes, reserves balances, etc. 3. Establish a funding agreement between the Town and the County for their share of various infrastructure projects, with payment in alignment and concurrent with project expenditures. 4. Establish 3 separate offsite levy reserves/accounts as required by the MGA one for each infrastructure type (i.e., transportation, water, and sanitary), and establish opening balances as reflected in Appendices B8, C8 and D8. In so doing, transfer $594, from the offsite levy reserves ($404, from water reserve and $190, from sanitary reserve) to general revenues to pay down a portion of the debt owed to the Town. This is to the benefit of developers debts remaining are charged 2.9% while funds remaining gain 1%. 5. Establish sub-ledgers for each reserve/account to track amounts owed to frontending parties (the Town is already a front-ending party, but other developers may become front-ending parties in the future). 6. Update offsite levy reserve/account balances annually (and financial statements, and other internal documentation) to reflect the true balance, including front-ending. 7. Develop an offsite levy policy framework to aide in effective implementation of the bylaw (in progress). 8. Undertake a water and sewer utility rates study to enable sustainable funding of the Town s share of offsite infrastructure projects. The last rate review should be brought current and in alignment with current master plans, offsite levy financing, etc. 9. Implement a long term financial sustainability assessment model that provides Council with confidence that the Town is on a financially sustainable path, contains reasonable tax impacts, and includes the impact of the Town s share of various development costs plus any front-ending that will be required on behalf of various offsite levy reserves. 10. Recent changes to the MGA will enable municipalities to charge separately for offsite levies (i.e., transportation vs. water vs. sewer). Accordingly, the Town should maintain accurate records to reflect which properties pay which offsite levies, and build this into the procedures guide discussed above. 7 ACKNOWLEDGEMENTS would like to thank all Town of Rocky Mountain House staff Version 6 October 25 th, 2016 / 5

10 and advisors from Engineering, Planning, and Finance, who supported the work of this review. 8 DISCLAIMER CORVUS Business Advisor has relied upon Town of Rocky Mountain House and its engineering advisors to provide all the data and information used to construct the offsite levy model and create the rates, such as planning data and assumptions, development forecasts and assumptions, infrastructure costs and costs estimates, allocations to benefitting parties, allocation to benefitting areas, and other assumptions etc. As such, CORVUS Business Advisors makes no guarantee as to the accuracy of the input data and information provided by these groups or the results that stem from this data and information. Offsite levy rates are not intended to stay static; they are based upon educated assumptions and the best available information of the day. Planning assumptions, cost estimates etc. can change each year. Accordingly, the Municipal Government Act requires that offsite levy rates be updated with the most available information on a regular basis (usually annually). When information changes, it will be reflected in a future update, and rates adjusted accordingly. Version 6 October 25 th, 2016 / 6

11 APPENDIX A: OFFSITE LEVY AREAS AND STAGING A1. Offsite Levy Areas In order to more easily facilitate the allocation of infrastructure to benefiting lands, the Town is parsed into 23 offsite levy areas, as shown in the map below. These areas are generally about a quarter section in size but also take into consideration various natural and manmade barriers (e.g., rivers, highways, etc.), as well as existing/planned infrastructure basins (e.g., water and sanitary basins). All offsite levy infrastructure costs are allocated to one or more areas. In the model, each area is further divided into sub-areas based on land use type (e.g., residential low density, residential high density, commercial, industrial, other). Offsite Levy Areas Version 6 October 25 th, 2016 / 7

12 Total net development area, the amount of land available for development in the offsite levy areas, is approximately 366 ha. In calculating net development area only those lands remaining to be developed within the area that have not previously paid offsite levies have been considered (as required by legislation/regulation). Further, allowances have been made to net development area calculations for environmental reserves, municipal reserves, and arterial road right of way. Offsite Levy Net Development Area Area Ref. # Land Use Gross Area (ha.) Environmental Reserves (ha.) Sub-total Municipal Reserves Arterial Right of Way Net Development Area (ha.) 1.1 Residential - Low Density Residential - Medium/High Density Commercial Industrial Other Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Version 6 October 25 th, 2016 / 8

13 Area Ref. # Land Use Gross Area (ha.) Environmental Reserves (ha.) Sub-total Municipal Reserves Arterial Right of Way Net Development Area (ha.) 12.1 Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Other Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Other Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial Residential - Low Density Residential - Medium/High Density Commercial Industrial In Boundary Only Summary of Offsite Levy Net Development Area Description ha. Gross Development Area Less Environment Reserve Less Municipal Reserve Less ROW Allowance - Net Development Area *Note: 1 Hectare (ha.) = ~2.47 Acres Version 6 October 25 th, 2016 / 9

14 Net development area definitions will be applied in determining offsite levy obligations of developers on application for subdivision or development within Town of Rocky Mountain House. Net development area is defined as follows: Gross Area The area of lands to be developed in hectares that have not previously paid an offsite levy. o o o Less: Any environmental reserves contained within the development area Including environmental reserves and environmental easements. Less: A 10% allowance for Municipal Reserves. Less: The measurement of arterial road right of way that bisects the development lands. Equals: Net Developable Area, which is the area subject to offsite levies. A2. Development Staging A rate planning period of 25-years was used for this review. This planning period is used by many municipalities as it provides a reasonable time frame to recoup the costs associated with offsite levy infrastructure construction, and it aligns with the timeframes of many municipal capital planning and construction cycles. Of the 366 ha. of net development area available across all offsite levy development areas, planners estimate that approximately 42% of this land (153 ha.) will develop during the next 25-years (the rate planning period) as shown in the tables below. Version 6 October 25 th, 2016 / 10

15 Anticipated Development During the 25-year Rate Planning Period Area Ref. # Area Develope d in Next 25 years Version 6 October 25 th, 2016 / 11

16 Area Ref. # Area Develope d in Next 25 years Version 6 October 25 th, 2016 / 12

17 Summary of Anticipated Development during the 25-year Rate Planning Period Developed In Next 25 Years % Developed Beyond 25 Years % Net Development Area Net development areas have been further classified according to anticipated land use. Land use classifications include: (1) Commercial, (2) Industrial, (3) Residential Low Density, (4) Residential Medium/High Density. and (4) Other. The table below outlines the anticipated development by land use type during the rate planning period (25-years). Anticipated Development by Land Use Type during the 25-year Rate Planning Period Land Use Type Net Development Area In Next % 25 Years Commercial % Industrial % Residential - Low Density % Residential - Medium/High Density % Other - 0.0% Total % A3. Service Demand Factors The level of impact on offsite infrastructure sometimes differs depending on the type of development (e.g., residential vs. commercial vs. industrial etc.). To account for this differential impact, the CORVUS offsite levy model enables the rates to be adjusted using service demand factors to allocate costs. However, for this review, the Town has treated all development equally and, and such, service demand factors have all been aligned as shown in the table below. Should the Town undertake an engineering analysis in the future that quantifies the nature of differential demand (if any), rates can quickly be adjusted during one of the Town s annual rate updates. Service Demand Factors Land Use Demand Factor Transportation Demand Factor Water Demand Factor Sanitary Commercial Industrial Other Residential - Low Density Residential - Medium/High Density Version 6 October 25 th, 2016 / 13

18 APPENDIX B: TRANSPORTATION OFFSITE INFRASTRUCTURE B1. Transportation Offsite Infrastructure Costs In order to support future growth, transportation offsite infrastructure is required. The estimated cost of this infrastructure is based upon: (a) actual construction costs to the cut-off date, (b) debenture interest associated with financing, and (c) future cost estimates. Total cost is approximately $15.84 million as outlined in the table below. Actual costs, debenture interest (if any), and cost estimates were provided by Town staff. It is important to note that these costs represent gross costs, of which only a portion will go to support development during the 25-year review period. The remainder of this section outlines how the net costs for development are determined. Summary of Transportation Offsite Infrastructure *Costs are based on 2015/16 estimates. **Estimates include engineering (10%) and contingencies (20%). A map showing the location of this infrastructure is shown below. Version 6 October 25 th, 2016 / 14

19 Location of Transportation Offsite Infrastructure B2. Transportation Offsite Infrastructure Grants & Contributions to Date The MGA enables the Town to allocate the costs of offsite infrastructure to development, other than those costs that have been provided by way of special grant or contribution (i.e., contributed infrastructure). Town of Rocky Mountain House has received approximately $0.19 million in special grants and contributions for transportation offsite levy infrastructure as shown in the table below (note, if the Town receives other grants or contributions in the future, it will be reflected in one of the annual updates and rates adjusted accordingly). The result is that the total reduced project estimated cost is $15.65 million. Version 6 October 25 th, 2016 / 15

20 Special Grants and Contributions for Transportation Offsite Infrastructure B3. Transportation Infrastructure Staging The timing of construction is used to determine the impact of inflation on cost, the impact of forecast reserve balances, and the estimate of financial oversizing (described in the Section that follows). The Town anticipates construction of offsite infrastructure as outlined in the table below. Note, if this schedule is adjusted in the future, it will be reflected in one of the Town s annual rate/bylaw updates. Transportation Infrastructure Staging Item Project Description First Year of Construction 1 54 Street Railway Crossing Avenue & Hwy 752 Intersection Upgrades Avenue (Hwy 752 to 1/4 section line) Avenue (1/4 section line to 46 Street) Avenue (46 Street to Hwy 11) Avenue (Hwy 11 to 42 Street) Avenue (42 Street to 1/4 section line Street Upgrade (42 Avenue to 44 Avenue) 2040 *Years that are blank reflect projects that have commenced construction or are completed. **Projects constructed beyond the 25-year review period (2040) will not be included in rates today (see financial oversizing in next Section). B4. Transportation Offsite Infrastructure Benefiting Parties The transportation offsite infrastructure previously outlined will benefit various parties to varying degrees. During this review three potential benefiting parties were identified including: Town of Rocky Mountain House a portion of the transportation infrastructure which is required to service existing residents. Other Stakeholders other parties (such as neighboring municipalities) that benefit from the infrastructure, as well as that portion of cost which benefits new development beyond the 25-year review period ( financial oversizing ). Version 6 October 25 th, 2016 / 16

21 Town of Rocky Mountain House Developers all growth related infrastructure (i.e., levyable transportation infrastructure costs) during the 25-year rate planning period. The table below outlines the allocation of transportation offsite levy infrastructure costs to benefiting parties. Percentage allocations have been determined after reducing transportation offsite levy infrastructure costs for grants and contributions described earlier. Allocation of Transportation Infrastructure to Benefiting Parties *Cost allocations for completed projects (if any) reflect allocations in effect at the time of the original bylaw. **In most cases, new project allocations were determined by Town staff using either a comparison of infrastructure capacity or a ratio of land developed to undeveloped. ***Financial oversizing is determined by separating out the pro rata portion of developer cost beyond the 25-year review period, in comparison with the anticipated year of construction. As the years move forward and rates are updated, these additional developer costs will be included in rate calculations. Oversizing shown as 100% reflects projects constructed beyond the 25-year review period. B5. Existing Receipts Using the offsite levy share percentages shown in the previous section and applying those percentages to project costs results in an offsite levy cost of approximately $2.51 million. However, prior to allocating these costs to benefiting areas, existing offsite levy receipts collected from developers need to be considered in determining the residual/net costs to developers. In addition to the unallocated credits reflected in the reserve balance (see Project 100), Town finance staff have advised that $0 transportation levies have been applied to various projects as shown in the table below. This results in an adjusted offsite levy cost of approximately $2.51 million. Offsite Levy Funds Applied to Date Version 6 October 25 th, 2016 / 17

22 B6. Summary of Transportation Offsite Levy Cost Flow-through As shown in the figure below, the total cost for transportation infrastructure that forms the basis of the rate is approximately $2.51 million. The cost allocations to each benefitting party are based on the benefitting percentages shown in Section B4. The offsite levy balance (due from developers) is allocated to various benefitting areas (as described in the next section). Total Transportation Offsite Levy Costs = Future Development (OSL Share) $2.51M Less: Levy Receipts Applied $0.00M = Off-site Balance* $2.51M Project Costs $15.84M Less: Special Grants & Contributions $0.19M = Project Balance $15.65M = Future Development Financial Oversizing $13.14M = Other Share $0.00M = Existing Development (Town Share) $0.00M B7. Transportation Infrastructure Benefiting Areas Net developer costs for each project have been allocated to multiple benefiting offsite levy area (see tables below). Allocations are denoted with a 1 below applicable area numbers. Benefiting areas were determined by Town engineering staff. The lands anticipated to develop over the 25-years in each offsite levy benefitting area are used to determine rates. Version 6 October 25 th, 2016 / 18

23 Benefiting Areas for Transportation Offsite Infrastructure Version 6 October 25 th, 2016 / 19

24 $ Town of Rocky Mountain House Offsite Levy Review B8. Reserve Balance As at December 31 st, 2015 the transportation reserve balance was $0.00, as the Town did not previously include transportation infrastructure in its offsite levy bylaw. In addition to establishing a dedicated transportation offsite levy reserve (required by the MGA), the Town must develop a set of sub-ledgers to track the amounts due to front-ending parties, including interest owed in accordance with the rates in effect at that time. Transportation Offsite Levy Reserve Balance Description Dr Cr Balance Offsite Levy Expenditures to December 31, 2015 $ - $ - Offsite Levy Receipt Allocations to December 31, 2015 $ - $ - Unallocated Receipts to December 31, 2015 $ - $ - Opening Balance $ - B9. Development and Transportation Infrastructure Staging Impacts Transportation offsite infrastructure will be constructed in staged fashion over the 25-year development period. We have reviewed the availability of offsite levy funds to meet these construction requirements and found that offsite levy reserve funds will not be sufficient to pay for construction of transportation infrastructure from time to time front ending of infrastructure will be required. A front-ender is the party (to date the Town of Rocky Mountain House has been the primary front-ender) that constructs and pays up front for infrastructure that benefits other parties. In order to compensate parties for capital they provide in front-ending offsite infrastructure construction, a 2.9% interest allowance has been charged to the reserve when in a negative balance. Further, a 1.0% interest credit has been provided to the reserve when it is in a positive balance. The graph and table below outline transportation levy reserve balances over the 25-year development period. Anticipated Transportation Offsite Levy Reserve Balances Transportation Reserve $2,000,000 $1,500,000 $1,000,000 $500,000 $- $(500,000) $(1,000,000) $(1,500,000) $(2,000,000) Year Reserve Balance *The interest staging adjustment (either positive or negative) built into the rates ensures that the reserve always Version 6 October 25 th, 2016 / 20

25 returns to breakeven. Anticipated Transportation Offsite Levy Reserve Balances Reserve Balance $ - Year Receipts Expenditure Interest Balance 2016 $ 35,302 $ - $ 353 $ 35, $ 350,923 $ 417,428 $ (895) $ (31,744) 2018 $ 27,871 $ - $ (112) $ (3,986) 2019 $ 39,472 $ - $ 355 $ 35, $ 84,085 $ - $ 1,199 $ 121, $ - $ - $ 1,211 $ 122, $ 349,960 $ - $ 4,723 $ 477, $ - $ - $ 4,770 $ 481, $ 41,599 $ - $ 5,234 $ 528, $ 311,713 $ - $ 8,403 $ 848, $ - $ - $ 8,487 $ 857, $ - $ - $ 8,572 $ 865, $ 521,109 $ - $ 13,869 $ 1,400, $ 91,627 $ - $ 14,924 $ 1,507, $ 109,277 $ 3,046,467 $ (41,466) $ (1,471,328) 2031 $ - $ - $ (42,669) $ (1,513,996) 2032 $ - $ - $ (43,906) $ (1,557,902) 2033 $ 162,832 $ - $ (40,457) $ (1,435,527) 2034 $ 197,627 $ - $ (35,899) $ (1,273,799) 2035 $ - $ - $ (36,940) $ (1,310,739) 2036 $ 551,587 $ - $ (22,015) $ (781,167) 2037 $ - $ - $ (22,654) $ (803,821) 2038 $ - $ - $ (23,311) $ (827,132) 2039 $ - $ - $ (23,987) $ (851,119) 2040 $ 851,119 $ - $ 0 $ 0 Version 6 October 25 th, 2016 / 21

26 APPENDIX C: WATER OFFSITE INFRASTRUCTURE C1. Water Offsite Infrastructure Costs In order to support future growth, water offsite infrastructure is required. The estimated cost of this infrastructure is based upon: (a) actual construction costs to the cut-off date, (b) debenture interest associated with financing, and (c) future cost estimates. Total cost is approximately $54.13 million as outlined in the table below. Actual costs, debenture interest (if any), and cost estimates were provided by Town staff. It is important to note that these costs represent gross costs, of which only a portion will go to support development during the 25-year review period. The remainder of this section outlines how the net costs for development are determined. Summary of Water Offsite Infrastructure *Costs are based on 2015/16 estimates. **Estimates include engineering (10%) and contingencies (20%). A map showing the location of this infrastructure is shown below. Version 6 October 25 th, 2016 / 22

27 Location of Water Offsite Infrastructure C2. Water Offsite Infrastructure Grants & Contributions to Date The MGA enables the Town to allocate the costs of offsite infrastructure to development, other than those costs that have been provided by way of special grant or contribution (i.e., contributed infrastructure). Town of Rocky Mountain House has received approximately $9.15 million in special grants and contributions for water offsite levy infrastructure as shown in the table below (note, if the Town receives other grants or contributions in the future, it will be reflected in one of the annual updates and rates adjusted accordingly). The result is that the total reduced project estimated cost is $44.99 million. Version 6 October 25 th, 2016 / 23

28 Special Grants and Contributions for Water Offsite Infrastructure *The Other Contribution to Project#7 stems from a portion of cost currently provided for via utility rates. C3. Water Infrastructure Staging The timing of construction is used to determine the impact of inflation on cost, the impact of forecast reserve balances, and the estimate of financial oversizing (described in the Section that follows). The Town anticipates construction of offsite infrastructure as outlined in the table below. Note, if this schedule is adjusted in the future, it will be reflected in one of the Town s annual rate/bylaw updates. Version 6 October 25 th, 2016 / 24

29 Water Infrastructure Staging Item Project Description First Year of Construction 1 High Lift Pumping 2 SCADA system 3 Reservoir Tie-in Line 4 WTP Upgrades 5 WTP Upgrades 6 WTP Particle Counter 7 WTP Upgrades 8 SCADA - WTP 9 Ten Inch Waterline (60 Street) 10 Water Line 11 Main Water 12 Water Supply Facilities 13 Water Distribution System 14 WTP Distribution Pump Upgrade Reservoir Emergency Standby Fire Pump & Diesel Engine Replacement/Upgrade WTP Raw Water Pump Upgrade Reservoir Pump Upgrade WTP Clearwell Expansion WTP Treatment Capacity Upgrade WTP Travelling Water Screen Upgrade (15,000m3/d) WTP Raw Water Intake Upgrade South Water Trunk Twinning - Hwy Ave to 50 Ave South Water Trunk Twinning - Hwy Ave to 50 Ave Reservoir Storage Expansion Reservoir Dedicated Fill Line from WTP WTP Discharge Pipe Upgrade - From 400mm to 600mm North IDP Area Trunk - 900mm (Reservoir to Hwy 598) North IDP Area Trunk - 600mm (Hwy 598 to north side of McNutt) 2050 *Years that are blank reflect projects that have commenced construction or are completed. **Projects constructed beyond the 25-year review period (2040) will not be included in rates today (see financial oversizing in next Section). C4. Water Offsite Infrastructure Benefiting Parties The water offsite infrastructure previously outlined will benefit various parties to varying degrees. During this review three potential benefiting parties were identified including: Town of Rocky Mountain House a portion of the water infrastructure which is required to service existing residents. Other Stakeholders (or oversizing) other parties (such as neighboring municipalities) that benefit from the infrastructure, as well as that portion of cost which benefits new development beyond the 25-year review period ( financial oversizing ). Town of Rocky Mountain House Developers all growth related infrastructure (i.e., levyable water infrastructure costs) during the 25-year rate planning period. The table below outlines the allocation of water offsite levy infrastructure costs to benefiting parties. Percentage allocations have been determined after reducing water offsite levy Version 6 October 25 th, 2016 / 25

30 infrastructure costs for grants and contribution described earlier. Allocation of Water Infrastructure to Benefiting Parties *Cost allocations for completed projects (if any) reflect allocations in effect at the time of the original bylaw. **In most cases, new project allocations were determined by Town staff using either a comparison of infrastructure capacity or a ratio of land developed to undeveloped. ***Other stakeholder s share represents that portion of the project which benefits parties beyond boundary and are as follows: Project#14-50%, Project#16-50%, Project#17-100%, Project#18-50%, Project#19-85%, Project#21-100%, Project#24-100%, Project#25-100%, Project#26-100%, Project#27-100%, Project#28-100%. ****Financial oversizing is determined by separating out the pro rata portion of developer cost beyond the 25- year review period, in comparison with the anticipated year of construction. As the years move forward and rates are updated, these additional developer costs will be included in rate calculations. Oversizing shown as 100% reflects projects constructed beyond the 25-year review period. C5. Existing Receipts Using the offsite levy share percentages shown in the previous section and applying those percentages to project costs results in an offsite levy cost of approximately $7.32 million. However, prior to allocating these costs to benefiting areas, existing offsite levy receipts collected from developers need to be considered in determining the residual/net costs to developers. In addition to the unallocated amounts currently in the offsite levy reserve (approximately $0.40 million), Town staff have advised that approximately $0.31 million in water levies have been applied to various projects. Further, Town staff have advised that Version 6 October 25 th, 2016 / 26

31 approximately $0.35 million should have been collected in the past (See Appendix F). This results in an adjusted offsite levy cost of approximately $6.27 million. Offsite Levy Funds Applied to Date C6. Summary of Water Offsite Levy Cost Flow-through As shown in the figure below, the total cost for water infrastructure that forms the basis of the rate is approximately $6.27 million. The cost allocations to each benefitting party are based on the benefitting percentages shown in Section C4. The offsite levy balance (due from developers) is allocated to various benefitting areas (as described in the next section). Version 6 October 25 th, 2016 / 27

32 Total Water Offsite Levy Costs Version 6 October 25 th, 2016 / 28

33 C7. Water Infrastructure Benefiting Areas Net developer costs for each project have been allocated to benefiting offsite levy area (see tables below). Allocations are denoted with a 1 below applicable area numbers. Benefiting areas were determined by Town engineering staff. For water infrastructure, Town staff opted to allocate infrastructure costs to all lands uniformly. The lands anticipated to develop over the 25-years in each offsite levy benefitting area are used to determine rates. Benefiting Areas for Water Offsite Infrastructure Item Developer Cost $ (3,416) $ (9,379) $ $ (7,957) $ (64,025) $ (1,540) $ 3,344, $ 58, $ 2, $ 6, $ 20, $ 868, $ 713, $ 84, $ 214, $ 61, $ $ 396, $ 580, $ $ $ $ $ $ $ $ $ $ 6,266,545 Version 6 October 25 th, 2016 / 29

34 Item Developer Cost $ (3,416) $ (9,379) $ $ (7,957) $ (64,025) $ (1,540) $ 3,344, $ 58, $ 2, $ 6, $ 20, $ 868, $ 713, $ 84, $ 214, $ 61, $ $ 396, $ 580, $ $ $ $ $ $ $ $ $ $ 6,266,545 Version 6 October 25 th, 2016 / 30

35 C8. Reserve Balance The Town currently maintains a single reserve/account to manage both water and sanitary funds. In accordance with the MGA, 2 reserves/accounts need to be created (one each for water and sanitary). At December 31 st, 2015, the balance of the Town s water/ sanitary reserve was $594, % of these funds ($404,149.74) have been allocated to the water reserve (68% represents the portion of the current rate comprised of water elements). Accordingly, at December 31 st, 2015 the new water reserve/account balance was ($4,502,225.01). The Town s ledgers should be amended to reflect this balance as it includes expenditures to date. This balance also assumes that the Town has withdrawn the remainder of unallocated receipts to repay front-ending parties. If the Town has not yet withdrawn funds to repay front-ending parties, it is strongly recommended that it do so immediately (charging interest rates are greater than earning interest rates therefore withdrawal of funds is to the benefit of the developer s reserve). It is also recommended that the Town develop a set of sub-ledgers to track the amounts due to front-ending parties, including interest owed in accordance with the rates in effect at that time. Water Offsite Levy Reserve Balance C9. Development and Water Infrastructure Staging Impacts Water offsite infrastructure will be constructed in staged fashion over the 25-year development period. We have reviewed the availability of offsite levy funds to meet these construction requirements and found that offsite levy reserve funds will not be sufficient to pay for construction of water infrastructure from time to time front ending of infrastructure will be required. A front-ender is the party (to date the Town of Rocky Mountain House has been the sole front-ender) that constructs and pays up front for infrastructure that benefits other parties. In order to compensate parties for capital they provide in front-ending offsite infrastructure construction, a 2.9% interest allowance has been charged to the reserve when in a negative balance. Further, a 1.0% interest credit has been provided to the reserve when it is in a positive balance. The graph and table below outline water levy reserve balances over the 25-year development period. Version 6 October 25 th, 2016 / 31

36 Anticipated Water Offsite Levy Reserve Balances *The interest staging adjustment (either positive or negative) built into the rates ensures that the reserve always returns to breakeven. Anticipated Water Offsite Levy Reserve Balances Opening Balance $ (4,502,225) Year Receipts Expenditure Interest Balance 2016 $ 86,383 $ 33,941 $ (129,044) $ (4,578,828) 2017 $ 858,704 $ 34,960 $ (108,897) $ (3,863,981) 2018 $ 68,200 $ 36,009 $ (111,122) $ (3,942,911) 2019 $ 96,588 $ 18,544 $ (112,081) $ (3,976,949) 2020 $ 205,754 $ 19,101 $ (109,919) $ (3,900,214) 2021 $ - $ 19,674 $ (113,677) $ (4,033,565) 2022 $ 856,347 $ 20,264 $ (92,727) $ (3,290,209) 2023 $ - $ 20,872 $ (96,021) $ (3,407,102) 2024 $ 101,793 $ 21,498 $ (96,477) $ (3,423,285) 2025 $ 762,757 $ 132,370 $ (80,994) $ (2,873,892) 2026 $ - $ 22,807 $ (84,004) $ (2,980,704) 2027 $ - $ 320,227 $ (95,727) $ (3,396,658) 2028 $ 1,275,146 $ 112,274 $ (64,780) $ (2,298,565) 2029 $ 224,210 $ 24,922 $ (60,879) $ (2,160,156) 2030 $ 267,400 $ 1,503,167 $ (98,482) $ (3,494,405) 2031 $ - $ 26,440 $ (102,104) $ (3,622,949) 2032 $ - $ 27,233 $ (105,855) $ (3,756,037) 2033 $ 398,449 $ 28,050 $ (98,184) $ (3,483,823) 2034 $ 483,590 $ 28,892 $ (87,845) $ (3,116,968) 2035 $ - $ - $ (90,392) $ (3,207,360) 2036 $ 1,349,726 $ - $ (53,871) $ (1,911,506) 2037 $ - $ - $ (55,434) $ (1,966,939) 2038 $ - $ - $ (57,041) $ (2,023,981) 2039 $ - $ - $ (58,695) $ (2,082,676) 2040 $ 2,082,676 $ - $ - $ (0) Version 6 October 25 th, 2016 / 32

37 APPENDIX D: SANITARY OFFSITE INFRASTRUCTURE D1. Sanitary Offsite Infrastructure Costs In order to support future growth, sanitary offsite infrastructure is required. The estimated cost of this infrastructure is based upon: (a) actual construction costs to the cut-off date, (b) debenture interest associated with financing, and (c) future cost estimates. Total cost is approximately $25.49 million as outlined in the table below. Actual costs, debenture interest (if any), and cost estimates were provided by Town staff. It is important to note that these costs represent gross costs, of which only a portion will go to support development during the 25-year review period. The remainder of this section outlines how the net costs for development are determined. Summary of Sanitary Offsite Infrastructure *Costs are based on 2015/16 estimates. **Estimates include engineering (10%) and contingencies (20%). A map showing the location of this infrastructure is shown below. Version 6 October 25 th, 2016 / 33

38 Location of Sanitary Offsite Infrastructure D2. Sanitary Offsite Infrastructure Grants & Contributions to Date The MGA enables the Town to allocate the costs of offsite infrastructure to development, other than those costs that have been provided by way of special grant or contribution (i.e., contributed infrastructure). Town of Rocky Mountain House has received approximately $0.36 million in special grants and contributions for sanitary offsite levy infrastructure as shown in the table below (note, if the Town receives additional grants or contributions in the future, it will be reflected in one of the annual updates and rates adjusted accordingly). The result is that the total reduced project estimated cost is $25.12 million. Version 6 October 25 th, 2016 / 34

39 Special Grants and Contributions for Sanitary Offsite Infrastructure D3. Sanitary Infrastructure Staging The timing of construction is used to determine the impact of inflation on cost, the impact of forecast reserve balances, and the estimate of financial oversizing (described in the Section that follows). The Town anticipates construction of offsite infrastructure as outlined in the table below. Note, if this schedule is adjusted in the future, it will be reflected in one of the Town s annual rate/bylaw updates. Sanitary Infrastructure Staging Item Project Description First Year of Construction 1 Aerators at Lagoon 2 Lift Station #1 Pump Upgrades 3 Lift Station #1 Pump Upgrades & new building 4 Lift Station & Forcemain (Lichak) 5 Sanitary Sewer Line 6 Main Trunk Sewer 7 Sanitary Sewer Trunk (Rail ROW) 8 Sanitary Sewer Trunk (Rail ROW) 9 Sewage Treatment Facilty 10 Sewage Collection System - Lift Station #1 11 Lift Station #1 Pump Upgrades & Wet Well Expansion & Forcemain Upgrade Lagoon Upgrades Lagoon Dredging/de-sludging Lagoon Upgrades South Sewer Trunk Upgrades - 60 Street South Sewer Trunk Upgrades - 43 Street - Hwy South Sewer Trunk Upgrades - Railway (46 St to 60 St) South Sewer Trunk Upgrades - Lagoon Inlet 2040 *Years that are blank reflect projects that have commenced construction or are completed. **Projects constructed beyond the 25-year review period (2040) will not be included in rates today (see financial Version 6 October 25 th, 2016 / 35

40 oversizing in next Section). D4. Sanitary Offsite Infrastructure Benefiting Parties The sanitary offsite infrastructure previously outlined will benefit various parties to varying degrees. During this review three potential benefiting parties were identified including: Town of Rocky Mountain House a portion of the sanitary infrastructure which is required to service existing residents. Other Stakeholders (or oversizing) other parties (such as neighboring municipalities) that benefit from the infrastructure, as well as that portion of cost which benefits new development beyond the 25-year review period ( financial oversizing ). Town of Rocky Mountain House Developers all growth related infrastructure (i.e., levyable sanitary infrastructure costs) during the 25-year rate planning period. The table below outlines the allocation of sanitary offsite levy infrastructure costs to benefiting parties. Percentage allocations have been determined after reducing sanitary offsite levy infrastructure costs for grants described earlier. Allocation of Sanitary Infrastructure to Benefiting Parties *Cost allocations for completed projects (if any) reflect allocations in effect at the time of the original bylaw. **In most cases, new project allocations were determined by Town staff using either a comparison of infrastructure capacity or a ratio of land developed to undeveloped. *** Other stakeholder s share represents that portion of the project which benefits parties beyond boundary and are as follows: Project#11-47%, Project#12-18%, Project#13-46%, Project#14-18%, Project#15-75%, Project#16-75%, Project#17-50%, Project#18-50%. ****Financial oversizing is determined by separating out the pro rata portion of developer cost beyond the 25- year review period, in comparison with the anticipated year of construction. As the years move forward and rates are updated, these additional developer costs will be included in rate calculations. Oversizing shown as 100% reflects projects constructed beyond the 25-year review period. Version 6 October 25 th, 2016 / 36

41 D5. Existing Receipts Using the offsite levy share percentages shown in the previous section and applying those percentages to project costs results in an offsite levy cost of approximately $4.66 million. However, prior to allocating these costs to benefiting areas, existing offsite levy receipts collected from developers need to be considered in determining the residual/net costs to developers. In addition to the unallocated amounts currently in the offsite levy reserve (approximately $0.19 million), Town staff have advised that approximately $0.54 million in sanitary levies have been applied to various projects. Further, Town staff have advised that approximately $0.31 million should have been collected in the past (See Appendix F). This results in an adjusted offsite levy cost of approximately $3.61 million. Offsite Levy Funds Applied to Date D6. Summary of Sanitary Offsite Levy Cost Flow-through As shown in the figure below, the total costs for sanitary infrastructure that forms the basis of the rate is approximately $3.61 million. The cost allocations to each benefitting party are based on the benefitting percentages shown in Section D4. The offsite levy balance (due from developers) is allocated to various benefitting areas (as described in the next section). Version 6 October 25 th, 2016 / 37

42 Total Sanitary Offsite Levy Costs Version 6 October 25 th, 2016 / 38

43 D7. Sanitary Infrastructure Benefiting Areas Net developer costs for each project have been allocated to benefiting offsite levy area (see tables below). Allocations are denoted with a 1 below applicable area numbers. Benefiting areas were determined by Town engineering staff. For sanitary infrastructure, Town staff opted to allocate infrastructure costs to all lands uniformly. The lands anticipated to develop over the 25-years in each offsite levy benefitting area are used to determine rates. Benefiting Areas for Sanitary Offsite Infrastructure Item Developer Cost $ $ $ (54,747) $ 22, $ 2, $ 20, $ 80, $ 23, $ 653, $ 130, $ 1,305, $ 120, $ 223, $ 64, $ $ 72, $ 922, $ 23, $ 3,611,962 Item Developer Cost $ $ $ (54,747) $ 22, $ 2, $ 20, $ 80, $ 23, $ 653, $ 130, $ 1,305, $ 120, $ 223, $ 64, $ $ 72, $ 922, $ 23, $ 3,611,962 Version 6 October 25 th, 2016 / 39

44 D8. Reserve Balance The Town currently maintains a single reserve/account to manage both water and sewer funds. In accordance with the MGA, 2 reserves/accounts need to be created (one each for water and sanitary). At December 31 st, 2015, the balance of the Town s water/ sanitary reserve was $594, % of these funds ($190,188.11) have been allocated to the sanitary reserve (32% represents the portion of the current rate comprised of sanitary elements). Accordingly, at December 31 st, 2013 the sanitary reserve balance was ($879,603.41). The Town s ledgers should be amended to reflect this balance as it includes expenditures to date. This balance also assumes that the Town has withdrawn the remainder of unallocated receipts to repay front-ending parties. If the Town has not yet withdrawn funds to repay front-ending parties, it is strongly recommended that it do so immediately (charging interest rates are greater than earning interest rates therefore withdrawal of funds is to the benefit of the developer s reserve). It is also recommended that the Town develop a set of subledgers to track the amounts due to front-ending parties, including interest owed in accordance with the rates in effect at that time. Sanitary Offsite Levy Reserve Balance D9. Development and Sanitary Infrastructure Staging Impacts Sanitary offsite infrastructure will be constructed in staged fashion over the 25-year development period. We have reviewed the availability of offsite levy funds to meet these construction requirements and found that offsite levy reserve funds will not be sufficient to pay for construction of sanitary infrastructure from time to time front ending of infrastructure will be required. A front-ender is the party (to date the Town of Rocky Mountain House has been the sole front-ender) that constructs and pays up front for infrastructure that benefits other parties. In order to compensate parties for capital they provide in front-ending offsite infrastructure construction, a 3.0% interest allowance has been charged to the reserve when in a negative balance. Further, a 1.0% interest credit has been provided to the reserve when it is in a positive balance. The graph and table below outline sanitary levy reserve balances over the 25-year development period. Version 6 October 25 th, 2016 / 40

45 Anticipated Sanitary Offsite Levy Reserve Balances Sanitary Reserve $500,000 $- $(500,000) $ $(1,000,000) $(1,500,000) $(2,000,000) $(2,500,000) Year Reserve Balance *The interest staging adjustment (either positive or negative) built into the rates ensures that the reserve always returns to breakeven. Anticipated Sanitary Offsite Levy Reserve Balances Opening Balance $ (879,603) Year Receipts Expenditure Interest Balance 2016 $ 49,265 $ - $ (24,080) $ (854,419) 2017 $ 489,724 $ - $ (10,576) $ (375,271) 2018 $ 38,895 $ - $ (9,755) $ (346,131) 2019 $ 55,085 $ - $ (8,440) $ (299,487) 2020 $ 117,343 $ - $ (5,282) $ (187,426) 2021 $ - $ - $ (5,435) $ (192,862) 2022 $ 488,380 $ - $ 2,955 $ 298, $ - $ 147,605 $ 1,509 $ 152, $ 58,053 $ - $ 2,104 $ 212, $ 435,005 $ 1,204,149 $ (16,142) $ (572,752) 2026 $ - $ - $ (16,610) $ (589,362) 2027 $ - $ - $ (17,091) $ (606,454) 2028 $ 727,223 $ 1,861,748 $ (50,488) $ (1,791,467) 2029 $ 127,868 $ - $ (48,244) $ (1,711,843) 2030 $ 152,500 $ - $ (45,221) $ (1,604,564) 2031 $ - $ - $ (46,532) $ (1,651,096) 2032 $ - $ 358,249 $ (58,271) $ (2,067,616) 2033 $ 227,238 $ 106,484 $ (56,459) $ (2,003,321) 2034 $ 275,794 $ - $ (50,098) $ (1,777,625) 2035 $ - $ - $ (51,551) $ (1,829,176) 2036 $ 769,757 $ - $ (30,723) $ (1,090,143) 2037 $ - $ - $ (31,614) $ (1,121,757) 2038 $ - $ - $ (32,531) $ (1,154,288) 2039 $ - $ - $ (33,474) $ (1,187,762) 2040 $ 1,187,762 $ - $ - $ (0) Version 6 October 25 th, 2016 / 41

46 APPENDIX E: BENCHMARK COMPARISONS The table below compares the weighted average offsite levy rate in the Town to rates in other municipalities. *CORVUS Clients **Rates shown are estimates only based on available information as at Version 6 October 25 th, 2016 / 42

47 APPENDIX F: HISTORICAL COLLECTIONS & RECONCILIATION The Town estimates that it should have collected $750, of offsite levies for certain historical water projects. The Town calculated this by comparing the historical offsite levy charge in the previous bylaw, with the amount of land that was developed. However, at end 2015, the reserve balance was just $404, The difference stems from levies the Town should have charged itself when it developed various lands in the past. To rectify this difference, the Town has "repaid" the offsite levy reserve by reducing the front-ending debt by $346, Historical Water Collections Reconciliation The Town estimates that it should have collected $503, of offsite levies for certain historical sanitary projects. The Town calculated this by comparing the historical offsite levy charge in the previous bylaw, with the amount of land that was developed. However, at end 2015, the reserve balance was just $190, The difference stems from levies the Town should have charged itself when it developed various lands in the past. To rectify this difference, the Town has "repaid" the offsite levy reserve by reducing the front-ending debt by $312, Historical Sanitary Collections Reconciliation Version 6 October 25 th, 2016 / 43