SUN PEAKS MOUNTAIN RESORT MUNICIPALITY

Transcription

1 SUN PEAKS MOUNTAIN RESORT MUNICIPALITY COMMITTEE OF THE WHOLE COUNCIL MEETING AGENDA 7:00 PM March 5, 2012 Page Municipal Council Chambers, Sun Peaks, B.C 1. CALL TO ORDER 2. ADOPTION OF THE AGENDA NEW BUSINESS a. Draft 5 Year Financial Plan Preliminary Report b. Strategic Community Investment Funds c. Community to Community Forum Resolution 4. ADJOURNMENT Page 1 of 22

2 Preliminary Budget Estimates For Fiscal Years 2012 to 2016 Prepared by: Byron Johnson Presented to Council on March 5, 2012 Draft 5 Year Financial Plan Preliminary Report Page 2 of 22

3 1.0 INTRODUCTION TO MUNICIPAL BUDGETING 1.1 Why do we budget? The Municipality of Sun Peaks is required by the Community Charter to develop a five year financial plan each year. The first year of the plan becomes the operating budget for the year. The budget has a number of functions, including the following: 1. Once approved by bylaw, the budget authorizes the municipal staff to make expenditures and employ people to carry out municipal activities that the Municipal Council has authorized. It also provides a yardstick to help measure whether staff are on-track with spending during the year. 2. The budget is the tool which determines the amount of tax that is required to be collected to fund municipal expenditures. Tax rates must be set by bylaw by May 15 th each year. The budget determines how much funding is required, the tax rates determine how much each taxpayer pays. 3. The budget process helps to inform the general public what our priorities and activities will be for the coming year. Budget meetings are open to the public and there is a special public input session planned which allows the public to make requests or suggestions that have a budget component. 4. The five year budget allows staff and Council to review the direction the municipal finances are heading, including consideration of how large capital projects will be funded, and how much the tax burden is expected to grow. 1.2 Types of budgets The two types of budgeting we will do are the operating budget and the capital budget. The operating budget covers every area of normal day-to-day expenditures. This includes spending required to fund the Fire Department, Village Administration, some Public works activities and other areas. The other type of budgeting is the capital budget which is used to fund projects which cost over $1000 with benefits which last more than one year. Our budget must include provisions to ensure that we have the funding required to complete the project. Preliminary Budget Estimates March 5, 2012 Page 2 Draft 5 Year Financial Plan Preliminary Report Page 3 of 22

4 1.3 The budget process The process for setting the budget will be as follows: 1. Staff will prepare operating and capital budget estimates for the next five years and present these to Council. 2. Any new items will be presented along with the overview of the key functions of the various departments. 3. A public input session will be scheduled (March 31st) at which the public will be invited to make their requests and comments on both the operating and capital budgets. 4. Subsequent to receiving public input, Council will be asked to approve the spending levels outlined in the Financial Plan. Council can make changes to the plan at their discretion and based on the public input they receive. 5. The decisions made by Council will translate into a certain level of taxation required to fund municipal operations. 6. Prior to May 15 th Council must have adopted two bylaws, first a 5 year financial plan bylaw which approves spending levels. Second a tax rates bylaw in which Council distributes the Municipal tax levy to the various ratepayers. 2.0 GENERAL CONCEPTS 2.1 Value Taxes All of the property taxes collected in Sun Peaks are value taxes based on the assessed values which are set by BC Assessment. There are currently no parcel taxes or frontage taxes assessed. 2.2 Tax Classes Properties are divided into Tax Classes based on the property uses. Every property within a tax class gets taxed at the same tax rate, meaning that a residential property that has an assessment twice that of another residential property will have twice as large a tax bill. In Sun Peaks the tax classes that we have are: Class 1 Residential, including vacant residential land, single family dwellings, multi-family dwellings, strata properties, & other residential Class 2 Utilities properties including Hydro, Terasen, SPUCL, gas lines Class 6 Business and Other classes including hotels, retail outlets, service outlets, etc. Class 8 Recreational & non-profit properties including the golf course and ski lift facilities Preliminary Budget Estimates March 5, 2012 Page 3 Draft 5 Year Financial Plan Preliminary Report Page 4 of 22

5 Sun Peaks does not have Heavy Industry, Light Industry, Assisted Living Housing, or Farm property. There are rental properties in Sun Peaks which have split assessments with a portion of the property falling into Business and Other class, and the balance remaining in Residential, this allocation is made by BC Assessment. 2.3 Tax Multiples The total municipal taxes collected in 2011 were set to be equivalent to the taxes collected for the same local services in 2010 prior to incorporation. For Provincial and Regional District services such as schools, policing, hospitals, waste management and libraries, the Province sets the tax multiples which are to be used when setting tax rates. Multiples are expressed as the tax rate ratio for each tax class relative to the residential tax rate. For example, for any tax rate set using the Provincial multiples the tax rate set for the Business and Other class MUST be 2.45 times higher than the Residential tax rate. If the Class 1 tax rate was set at $5 per $1000 of assessed value, the Business and Other tax rate would be $12.25 per $1000. These ratios are outlined in the table below: Tax Classes and Provincial Multiples 01 - Residential Utilities Business And Other Rec/Non Profit 1.00 Municipalities have the option of setting their own tax rates and multiples for municipal services. This ability allows Councils to formulate tax policies which are responsive to their community needs. This is one of the strongest policy tools that Councils possess. In 2011 the tax multiple for the Business and Other tax class was set at 1.5 times the Residential rate in recognition of the financial hardship of local businesses, resulting in a tax shift of $78,000 from business taxes to the other tax classes. This is an area which we will re-visit when we set the tax rates, later in the budget process. 2.4 Tax Calculations The formula for calculation of taxes payable is as follows: Assessment x Tax Rate = Property Taxes Assessments are determined by BC Assessment Tax Rates are set by Council and other Taxing Authorities Preliminary Budget Estimates March 5, 2012 Page 4 Draft 5 Year Financial Plan Preliminary Report Page 5 of 22

6 Understanding the tax formula: If a property increases in value by exactly the average assessment increase, its taxes will go up by the percentage tax increase set by Council. If Assessment increase > Average = Property Tax increase > Average If Assessment increase < Average = Property Tax Increase < Average The municipality has no control over the values assigned by BC Assessment, and there is only one residential tax rate. So any increases or decrease to assessments in a year relative to the rest of the community, will impact the taxes paid on the property. This makes it possible that some properties and whole neighborhoods could have larger tax increases and decreases, even though Council has targeted a lower number. For clarity, when a tax increase is mentioned in the Municipal budget process, this refers to a REAL effective change. For example, if it is stated that there will be no change to taxes, it means that the average taxpayer will pay the same amount on the same property as the previous year. Of course, it is sometimes hard to find that average taxpayer. 2.5 Taxing Authorities Who sets the tax rates in Sun Peaks? Sun Peaks Municipal Council sets the tax rates for the Village operations Thompson Nicola Regional District sets the tax rates for the RD functions o RD Administration o Solid Waste and Recycling` o Library System o Hospital tax Provincial Government for o School tax rates o Police Tax Rates o BC Assessment rates Municipal Finance Corp for MFA rate At Sun Peaks we will collect taxes on behalf of all of the above agencies and remit those taxes to them. When we review tax rates, more information on the relative amounts collected for each agency will be brought to Council. Preliminary Budget Estimates March 5, 2012 Page 5 Draft 5 Year Financial Plan Preliminary Report Page 6 of 22

7 3.0 SUN PEAKS DATA 3.1 Assessments in Sun Peaks Below is a chart showing the assessed value by Class for the 2012 taxation year. This is based on the valuation date of July 1, It is also based on the Completed Roll, which is the first estimate of the tax roll by BC Assessment. By the end of March we shall receive the Revised Roll which is the final roll to be used for the calculation of taxes. The revised roll incorporates any changes due to appeals by homeowners. Assessed Value Changes CLASS % CHANGE 1 RESIDENTIAL 475,428, ,652, % 2 UTILITIES 202, , % 6 BUSINESS 44,375,702 45,521, % 8 RECREATIONAL 7,411,000 7,643, % TOTAL ASSESSMENTS 527,417, ,021, % Key Assessment Points: Overall the Assessment base has declined by 7.5% to $527,417,600, this consists of the following trends: o A non-market increase of $3,118,500 or 0.55%, primarily new residential construction. This represents a taxation growth of $7,200 for o A market change of -$45,723,000, related to declining real estate values. There are 1,540 residential folios in our 2012 assessment o The average vacant lot is valued at $190,257 vs. $212,900 in 2011 o The average Single Family Dwellings is valued at $642,571 vs. $696,600 in 2011 o The overall average residential value in Sun Peaks is $320,717 vs. $348,600 in 2011 (including SFD, Stratas, and Multi-family homes, excl vacant lots) Residential properties make up 90.1% of the total assessments o Business and Other folios make up 8.4% of the total o Recreational Property folios make up 1.4% of the total Preliminary Budget Estimates March 5, 2012 Page 6 Draft 5 Year Financial Plan Preliminary Report Page 7 of 22

8 4.0 SUN PEAKS FIVE YEAR BUDGET The Municipal budget can be broken into the following major categories: 1. Revenues 2. Operating Expenses 3. Capital Projects 4. Transfers to/from Reserves PLEASE NOTE THAT ALL MENTIONS OF FINANCIAL NUMBERS FOR 2011 ARE FOR COMPARATIVE PURPOSES ONLY. THESE ARE NON-AUDITED, AND THE FINAL BOOK ENTRIES FOR 2011 YEAR-END ARE NOT POSTED YET. 4.1 Municipal Revenues A chart showing the Revenues for Sun Peaks for the 5 year planning window is as follows: Revenues 2011 Est Property Taxes Municipal Property Taxes 1,294,420 1,294,000 1,301,200 1,314,212 1,327,354 1,340,628 Assessment Base Growth 7,200 13,012 13,142 13,274 13,406 Tax to Service New Debt 140, , , ,000 Total Property Taxes 1,294,420 1,301,200 1,454,212 1,467,354 1,480,628 1,494,034 Other Revenues 1% Utility Taxes 12,600 37,600 49,000 49,000 49,000 49,000 Property Tax Penalties 70,098 50,000 50,000 50,000 50,000 50,000 Cable Room Rental 1,400 1,400 1,400 1,400 1,400 1,400 Business License fees ,000 25,000 25,000 25,000 Building Permit Fees 2,343 10,000 20,000 30,000 30,000 30,000 Misc Planning Permits 1,600 1,000 1,000 1,000 1,000 1,000 Total Other Revenues 88, , , , , ,400 Grant Revenue Small Communities Investment Fund 311, , , , , ,000 Resort Municipality Initiative 313, , , , , ,000 Gas Tax Sharing 92,696 65,000 65,000 65,000 65,000 65,000 ICSP Grant Funding 85,000 75,000 Community Recreation Grant 650,000 Forest Fuels Management Grant 180, ,000 Total Grant Revenue 717,537 1,615, , , , ,000 Miscellaneous Income / Reserve Transfers Payment by MoT per redn of road inventory 57,000 44,000 Misc Income 27,852 4,400 2,200 Transfer from RMI Reserves 157,000 Transfer from Fire Apparatus Reserve 350,000 Donation from Health Assoc/Community 450,000 Debenture Proceeds - Multiplex & Health Centre 1,650,000 Accum Surplus and Reserves to Projects 500, ,000 Budget Plug (from/to Accum Surplus) (39,864) (73,829) 38,049 53,691 42,207 Total Misc Income 27, ,536 2,722, ,049 53,691 42,207 TOTAL REVENUES 2,127,850 3,637,780 4,926,499 2,764,319 2,218,719 2,220,641 Preliminary Budget Estimates March 5, 2012 Page 7 Draft 5 Year Financial Plan Preliminary Report Page 8 of 22

9 Key Points for Revenue Items Property taxes are forecast to remain the same for 2012 with the inclusion of assessment growth amounting to 0.55% totaling $7200 of tax growth. For budget purposes, a 1% growth to the assessment base is forecast from 2013 to Starting in 2013 are two separate debenture payments totaling $140,000 (principal and interest), to fund the planned Health Centre and the Recreational Multiplex. See section 4.3 of this report for more discussion of these projects. Property taxes account for 46% of the total revenue for Sun Peaks over the next five years versus virtually 100% for the old Improvement District. For many people this was an important reason for incorporation. The 1% Utility taxes are based on the revenue from Utility companies and are intended to replace actual valuation and taxation of owned physical infrastructure such as water mains, gas lines, etc. The payment schedule for the utilities is set by Provincial regulations and is intended to have a slow ramp up. Business license fees will not start until 2013, the goal is to have the BL bylaw completed in Building permit fees, and planning permit fees are estimates, the actual revenue will vary depending upon the level of construction activity in Sun Peaks. The Small Community Investment Fund is an unconditional grant, it has been accelerated to have larger payments in 2011 and It is only guaranteed until 2014, we are presuming its continuation after that timeframe. The Gas Tax Grant is a conditional grant which must be spent on environmentally positive projects or community capacity building projects. In 2011 we received the first payment for Sun Peaks under the Resort Municipality Initiative (RMI) program, the funds were allocated to a reserve for Tourism Infrastructure and Events projects. The annual estimated revenue amount is based on the 2011 actual amount received, carried forward for the 5 years. o Our spending plan for 2012 is $470,000. These funds will be spent on two major music concerts, an Oktoberfest celebration, and the purchase of a mobile stage. o For budget purposes for 2013 to 2016, it is assumed that the expenditures will match the revenues, although specific projects have not been selected. o This program is managed jointly by the SPMRM and TSP. If the Health Centre project proceeds it will be funded by a combination of Community Donations, a municipal debenture, and use of accumulated surpluses. A more detailed description of the project is given later in the report. Preliminary Budget Estimates March 5, 2012 Page 8 Draft 5 Year Financial Plan Preliminary Report Page 9 of 22

10 If the Recreational Multiplex project proceeds it will be funded by a combination of Community donations, a municipal debenture, use of accumulated surpluses AND a Provincial grant. A more detailed project description follows later in this report. 4.2 Operating Expenses Council Operating Expenses - Council 2011 Est Council Remuneration 34,000 34,000 34,000 34,000 34,000 34,000 Council Expenses 2,236 21,000 21,000 21,000 21,000 21,000 Community Support ,000 4,000 4,000 4,000 36,236 55,500 59,000 59,000 59,000 59,000 Council expenses include Council travel, meetings and conference expenses, hosting, and a contingency account. Administration Operating Expenses - Administration 2011 Est Administration Wages & Benefits 228, , , , , ,000 Other Administration costs 255, , , , , ,765 Elections/Referendums Expense 4,985 4,000 5,000 - IT Fees & Support 9,367 8,800 11,894 11,988 12,084 12,181 Building Inspection 6,653 12,425 22,150 22,150 22,300 22,300 Planning 13,937 18,273 18,641 19,020 19,411 19,813 OCP & Zoning Development 17,518 85,000 75,000 Bylaw Enforcement / Security 17,701 90, , , , ,070 Total Administration 553, , , , , ,129 Admin FTE Count 2011 Est Chief Administrative Officer Finance Officer Reception / Clerical Building Inspector Bylaw Enforcement Officer Total Administration Legal fees are included in Other Administration Costs, they are expected to decline from $155,000 in 2011 to $97,000 in 2012, to $40,000 in 2013, to $15,000 per year thereafter. Current higher spending is primarily due to the challenge to our incorporation brought by the Adams Lake Indian Band. Wages and Benefits include the employees listed in the FTE Count chart above. Wages are assumed to increase at a rate of 1% per year for each year of this plan, subject to an annual review and approval by Council. This is true for the Fire Department staff as well. Preliminary Budget Estimates March 5, 2012 Page 9 Draft 5 Year Financial Plan Preliminary Report Page 10 of 22

11 A referendum will likely be held in 2012 to obtain financing for the Health Centre and the Recreational Multiplex. Planning is based on some Planning services being purchased from the TNRD, and Approving Officer services being provided contractually as well. Both of these items are approved by Council. The Official Community Plan development and the Zoning Bylaw amendment are activities planned for The expenditures are matched by a grant received by the Municipality pertaining to ICSP development. Bylaw enforcement / Security costs include the cost of our bylaw enforcement officer and supplies and the anticipated costs for additional security services. Capital Project Planning Operating Expenses - New Major Projects 2011 Est Recreational Multiplex - Municipal Subsidy 30,000 30,000 30,000 Capital Projects Pre-work 40,000 Capital Projects Public Mtgs/Travel 10,000 10,000 50,000 10,000 30,000 30,000 30,000 These budget items cover the cost of the planning for major capital projects, including the Recreation Multiplex and the Medical Centre. These costs are not capitalized because the projects are only at the feasibility stage. Public Works Operating Expenses - Public Works 2011 Est Street Lighting Expense 1,481 2,150 2,176 2,202 2,228 2,225 Solid Waste Tipping/Extra hours 53,335 55,000 55,000 55,000 55,000 55,000 Garbage Bin Maintenance 1,241 8,000 8,000 8,000 8,000 8,000 Winter Road Maintenance 7,400 22,400 61,200 61,200 61,200 Summer street mtce 4,000 2,000 32,000 32,000 32,000 Signage 2,500 1,000 1,000 1,000 1,000 Asphalt Patching 15,000 15,000 15,000 56,057 79,050 90, , , ,425 The Municipality takes over responsibility for road maintenance within our boundaries effective September 21, For 2012 we are planning to start using more snow markers to help define the snow clearing area better. We are conducting a review of our road inventory to help determine the areas where the MoT needs to focus its maintenance activities on in the meantime and to determine our maintenance priorities. Preliminary Budget Estimates March 5, 2012 Page 10 Draft 5 Year Financial Plan Preliminary Report Page 11 of 22

12 In 2012 we wish to start development of the snow clearing parameters, balancing resident s expectations with the cost of snow clearing services. Fire Department Operating Expenses - Fire Department 2011 Est Wages and Benefits 264, , , , , ,240 Volunteer Stipends 29,998 30,360 30,724 31,093 31,466 31,844 Work Experience Program 11,260 11,700 11,826 12,004 12,133 12,263 Uniforms 2,028 3,100 3,137 3,175 3,213 3,251 Training 18,971 30,000 30,000 30,000 30,000 30,000 Promotion & Recruitment 2,778 2,300 2,328 2,356 2,384 2,412 Fire Prevention 3,545 5,000 4,000 4,000 4,000 4,000 Dues & Memberships 2,453 2,900 3,312 2,954 2,986 3,024 Fire Dept Administration 9,128 8,620 9,117 9,234 9,352 9,472 Fire Dept Contingency - 12,000 12,000 12,000 12,000 12,000 Fire Hall Costs 28,199 28,750 29,095 29,444 29,797 30,155 Vehicles 36,241 30,500 30,866 31,236 31,611 31,991 Communications Equipment 1,116 1,128 1,142 1,156 1,169 1,184 Fire Fighter Equipment 26,400 27,000 27,540 28,091 28,653 29,226 Fire Suppression SPUCL Charge 100, , , , , ,300 Emergency Management 2,560 5,000 5,000 5,000 5,000 5,000 Total Fire Department Expenses 539, , , , , ,362 FTE Count Paid staff includes the Fire Chief and the two Fire Captains. The Training Officer position is currently vacant, but interviews are underway. As usual, there is a very active training schedule for 2012 due to volunteer turnover and the WEP program. Different training programs are run to accommodate all skill and experience levels from new recruits to senior firefighters. The Emergency Medical Responder pilot project is still proceeding providing a high level of service to residents and visitors to Sun Peaks. Emergency Management is an area still under development, more exercises are planned for 2012, with a focus on the continued development of EOC skills and personnel. Bank & Financing Charges Bank and Finance Charges 2011 Est Financing Charge - Fire Truck 64,416 64,416 64,416 64,416 64,416 64,416 Financing Charge - Fire Hall Extension 13,187 13,187 13,187 13,187 13,187 13,187 Finance Charge - Health Centre 76,100 76,100 76,100 76,100 Finance Charge - Recreational Multiplex 63,400 63,400 63,400 63,400 Bank Charges 2,686 2,700 2,732 2,765 2,798 2,832 Total Bank and Finance 80,289 80, , , , ,935 Preliminary Budget Estimates March 5, 2012 Page 11 Draft 5 Year Financial Plan Preliminary Report Page 12 of 22

13 The above debentures are held by the Province, the Fire Truck extends until 2021 and the Fire Hall Extension extends until Both of these debentures have an interest rate of 4.45%. The Health Centre debenture will proceed subject to project approval by Council and a positive referendum of our voters. The payment listed above is based on a $900,000, 15 year debenture, at the current rate of 3.5% from the MFA. The Recreational Multiplex debenture is a $750,000 loan, same conditions as above, but also dependent upon successful grant funding of $650,000 from Community Recreation grant. 4.3 CAPITAL EXPENDITURES Capital Program 2011 Est Fire Department Capital Communications Equipment 3,374 4,100 3,600 3,600 3,600 3,600 Computers 1,200 5,000 1,200 1,200 1,200 FF Equipment 9,808 10,300 10,000 8,800 9,700 9,900 Personal Protective Equipment 15,380 13,000 11,200 16,450 13,600 7,650 Medical Equipment 1,000 5,000 Wildland Fire Equipment 4,000 Tools 0 3,000 3,500 Thermal Imaging Camera 5,000 Fire Vehicles / Apparatus 8, ,000 0 TOTAL FIRE DEPARTMENT CAPITAL 36,570 32,600 33, ,550 33,100 27,350 General Capital Misc Admin Capital 5,750 5,000 5,000 5,000 5,000 5,000 Computer 11,690 3,500 Vadim Software Purchase 26,020 School House Contribution 42,000 Community Recreational Multiplex 1,150,000 1,250,000 Health Centre 1,487,000 TOTAL GENERAL CAPITAL 59,440 1,184,520 2,742,000 5,000 5,000 5,000 TOTAL SPMRM CAPITAL 96,010 1,217,120 2,775, ,550 38,100 32,350 The only large item on the FD list is the replacement of Engine 3 in The amounts which have been accumulated in the FD Apparatus reserve will be sufficient to fund the purchase without the need for a debenture. The Vadim Software purchase has been approved by Council as an early budget approval, due to the need to get it installed and operational prior to property tax season. Staff is working on developing a Sustainability/Green Projects capital list. The Community Works fund component of the gas tax funding will be the source of funds. Preliminary Budget Estimates March 5, 2012 Page 12 Draft 5 Year Financial Plan Preliminary Report Page 13 of 22

14 Major Capital Projects: Community Recreational Multiplex: The vision for this project is to build a multi-use building which will include an ice rink, a running track, a fitness facility and some public meeting space. The building will be used in the summer for housing events such as concerts and trade shows. The building will consist of a metal structural frame covered by an engineered fabric. This structure will be located adjacent to Bentos. In December 2011, a grant funding request was submitted to the Province requesting $650,000 to help construct this project, as at the date of this report we have not received a decision from the Province. The municipal portion of this project will be funded by a combination of the use of the accumulated surplus, reserves, RMI funding, and an MFA debenture. It is estimated that this facility may require a municipal operating subsidy of $30,000 per year, shown in the budget from 2014 forward. The earliest debenture, if the referendum is approved, would be the fall 2012 issue of the MFA, the first payment of principal and interest would not occur until If grant is awarded, staff will bring a comprehensive funding plan to council. For budget purposes we are assuming that the grant is successful at the $650,000 level meaning that we will proceed with Phases 1 & 2, for a total cost of $2.55 million: Source of Funds: Prov Grant (2012) $650,000 Accum Surplus/res/RMI (12/13) $1,000,000 Donations/Naming rights $150,000 MFA debenture (2012) $750,000 Operating Impact: MFA pmt (2013 onwards) $63,400 Operating subsidy (2014) $30,000 This project is still at its early stages, as such the cost estimates have a range of +/- 25%. Before this project goes to a referendum, the cost estimate will be sharpened and a public input process will be held to ensure we have considered all of the major uses for the facility. Sun Peaks Health and Emergency Centre: This project involves building a multi-use medical facility which would include space to facilitate regular visits by doctors to Sun Peaks, combined with space to handle patients after they are processed by ski patrol. There are currently no grant opportunities for this project, a previous grant application was not approved by the Province. Preliminary Budget Estimates March 5, 2012 Page 13 Draft 5 Year Financial Plan Preliminary Report Page 14 of 22

15 Council has approved moving the project to a detailed design stage in conjunction with the Health Association. It is assumed that both Phase 1 & 2 of the project will be completed, at the same cost which was originally included in the Towns for Tomorrow grant application of Phase 1 and 2 will see the completions of the building, the finishing of both floors of the building, with medical uses on the first floor and Ski Patrol and Community space on the second floor. These phases together have a previous cost estimate of $1,487,000, this is also a very preliminary estimate that will change with further design work. For budget purposes, we are assuming that the project will be further developed in the Spring/Summer of 2012, with a referendum held in the late summer, and a debenture sought from the MFA at the fall 2012 issue. Source of Funds: Health Assoc./donations (2013) $450,000 SPMRM surplus (2013) $137,000 MFA debenture (2012) $900,000 Operating Impact: MFA Pmt (2013 onward) $76, TRANSFERS TO RESERVES AND SURPLUS Transfers to Reserves 2011 Est Capital Reinvestment Reserve - Roads 100,000 75,000 75,000 75,000 75,000 75,000 Capital Parks Reserve 50,000 25,000 25,000 25,000 25,000 25,000 Fire Apparatus Reserve 150, , , , , ,000 Gas Tax Reserve 65,000 65,000 65,000 65,000 65,000 65,000 Transfer to RMI Reserve 313,000 Total Transfers to Reserves 678, , , , , ,000 A new reserve account was set up in 2011 pertaining to the RMI program. Funding received from the Province under this program must be spent on tourism enhancing activities. The funding for 2011 was received too late in the year to be spent, so it was put in the reserve for future spending. The long range goal of the municipality is to ensure that we are saving adequate funds to be able to fund operations without significant tax spikes. As municipal costs increase, Council has the option of lowering payments into these reserves, softening the taxation impact which would be required. Amortization charges for current assets totaled $208,000 in Roads We know that Sun Peaks currently has an infrastructure gap related to our municipal roads. The gap is the level of expenditure which would be required to bring each road up to an appropriate standard. The Kerr Wood Liedel Report from 2009 suggested that the infrastructure gap was $1,085,000 for the roads themselves, without full consideration of associated structures such as sidewalks, and lighting. In 2012 we will be conducting condition assessments of our roads to help determine an appropriate capital expenditure program, which will drive our reserve allocation. Preliminary Budget Estimates March 5, 2012 Page 14 Draft 5 Year Financial Plan Preliminary Report Page 15 of 22

16 Fire Apparatus In addition to the known infrastructure deficit, we also need to consider various capital projects that we know will occur in the future. Fire Department apparatus is an example of big ticket items that are difficult to fund. Different communities operate at very different ends of the spectrum, with some communities saving up the money in advance to fund the large apparatus, and others relying on debt funding. In the past the Improvement District incurred debt to fund the large apparatus because it was their only option. That approach adds to the cost of these items by the amount of the financing charge. The overuse of debt financing to fund regular replacements, limits the ability to do large community projects due to the debt ceiling regulations set by the Province. Parks Projects The budget also includes a transfer for parks infrastructure, an actual work plan will be developed in the OCP process. Budget Surplus The amount of the final budget surplus for 2011 will not be known until the end of March, after the auditors have had a chance to review the books and make any final adjusting entries. This date allows Council full flexibility in allocating the budget to various potential activities. Staff will be making a report to Council explaining the budget variances which led to the surplus, and will make recommendations regarding its disposition. The surplus can be utilized in various ways including: To build up capital reserves or accumulate funds for specific projects. To leave on the books as a surplus amount, providing a cushion against unexpected cost items. To reduce the tax charged to property owners in NEXT STEPS The Municipality is having a public input session on March 31st to discuss the budget. The purpose of the meeting is to allow residents and other taxpayers the opportunity to have their views known regarding budgets and taxation, it also allows people to make requests for services that have a budget component. The key budget dates are as follows: March 5 th COW session, delivery of preliminary budget report to Council March 31 st Public budget input session o Presentation of budget to the public o Budget input by the public April 2 nd - First COW after Public Input Session, o Council to make decisions regarding Spending items, Capital Budgets, etc Preliminary Budget Estimates March 5, 2012 Page 15 Draft 5 Year Financial Plan Preliminary Report Page 16 of 22

17 o Presentation of Financial statements by auditors to Council May 7 th Convert COW to a Special Council meeting to give 3 readings to Financial Plan Bylaw and Tax Rates bylaw. May 14 th Add a special Council session to adopt the Bylaws o This session can replace the May 21 st Council session which was previously planned to be held on May 22 nd (due to Victoria Day holiday). Week of May 14 Tax notices published and distributed July 3 rd at 4:30 pm, tax payment deadline Preliminary Budget Estimates March 5, 2012 Page 16 Draft 5 Year Financial Plan Preliminary Report Page 17 of 22

18 Agenda Item # 3b. To: All Municipal and Regional District Financial Administrators Re: Strategic Community Investment Funds February 27, 2012 In this difficult economic time, certainty is critical for the Ministry of Community, Sport and Cultural Development and for local governments. Restructuring the small community and regional district and traffic fine revenue sharing grants provides this certainty. Many local governments rely on a steady stream of grant funding to meet operational requirements and there are frequently concerns with respect to the level of grant funding for the future. Undertaking the Strategic Community Investment Fund program allows the Province of British Columbia (Province) to strengthen its commitment to local governments. The Strategic Community Investment Fund program will achieve the objectives of supporting local government efforts to stimulate local economies and will provide local governments with increased financial certainty while continuing to support investments in community safety for which traffic fine revenue sharing grants are intended. Providing more funding sooner allows local governments to make strategic spending decisions, stimulating local economies and creating local jobs. By detailing the level of funding in the Funds Agreement for each of the next three years, both the Province and local governments are provided with budget certainty for the future. As in past years, the grant amounts will be recalculated as new data is received. Funding will be provided in a flexible, objective-based approach, enabling the money to flow quickly to communities while ensuring a strong accountability framework. In order to be eligible to receive funds each year, local governments must continue to develop a plan that sets out the intended uses and performance targets for those funds and must report publicly on their plan and progress towards achieving performance targets by June 30 in each following year. Under the SCIF Agreement, the Province intends to maintain the same level of funding as under the formulas in the Local Government Grants Act. For certainty, transfer amounts will be authorized in each fiscal year, subject to receipt of a report that funds received to date have or are being used for the intended purposes and that public disclosure has or is being complied with in accordance with the Funds Agreement. Strategic Community Investment Funds Page 18 of 22

19 Agenda Item # 3b. Please sign the attached Funds Agreement to indicate your acceptance of the terms and conditions within and return to the Ministry of Community, Sport and Cultural Development as soon as possible, and no later than March 23, The Province cannot ensure payment of Funds to local governments submitting signed Funds Agreements after March 23, In recognition of the short timeframe to sign and deliver the Funds Agreements, local governments are encouraged to an electronic version of their signed Agreement. Electronic copies of a signed Funds Agreement may be ed to: Jennifer.Richardson@gov.bc.ca. Hard copy original signed Funds Agreements, along with the Council/Board resolution authorizing entering into the Agreement, may be sent to: Mailing Address Ministry of Community, Sport and Cultural Development Local Government Infrastructure and Finance Branch PO Box 9838 Stn Prov Govt Victoria, BC V8W 9T1 If you have any questions, please contact Jennifer Richardson at or by at: Jennifer.Richardson@gov.bc.ca. Sincerely, Original signed by Don Fast Deputy Minister Ministry of Community, Sport and Cultural Development Strategic Community Investment Funds Page 19 of 22

20 Agenda Item # 3b. STRATEGIC COMMUNITY INVESTMENT FUNDS AGREEMENT This Agreement made as of, 2012, BETWEEN: Sun Peaks Mountain Resort Municipality (Local Government) AND: HER MAJESTY THE QUEEN IN RIGHT OF THE PROVINCE OF BRITISH COLUMBIA represented by the Deputy Minister of the Ministry of Community, Sport and Cultural Development (Province). WHEREAS: A. The Province acknowledges that in this difficult economic time, financial certainty is critical for the Province and for local governments. B. The Province intends to strengthen its commitment to local governments by providing Strategic Community Investment Funds (Funds) over the next three years ( ). This is also intended to provide bridge financing until local and provincial economies improve. C. By clarifying funding levels for the next three years, local governments are provided with the fiscal certainty required to make spending decisions, stimulate local economies and create jobs. D. The Province and the Local Government acknowledge the importance of reporting to residents on how the Funds are used. Transfers will be authorized using a flexible, purpose and objective-based approach to enable the Funds to flow quickly to communities, while ensuring a strong accountability and reporting framework. NOW THEREFORE, in consideration of the mutual promises herein, the Local Government and the Province agree as follows: Provided the Local Government complies with the terms and conditions of this Agreement, transfers will be authorized in the following amounts, for the purposes identified, on or before the date indicated. Strategic Community Investment Funds Page 20 of 22

21 Agenda Item # 3b. Assured Funds Use Date Amount Small Community local government March 31, 2012 $128,646 Grants services June 30, 2012 $193,398 March 31, 2013 $42,882 June 30, 2013 $107,634 Traffic Fine Revenue Sharing Grants defray the cost of local police enforcement June 30, 2014 $150,516 March 31, 2012 June 30, 2012 March 31, 2013 June 30, 2013 June 30, CONDITIONS RELATING TO PAYMENTS BY THE PROVINCE Notwithstanding any other provision of this Agreement, the payment of money, or incurrence of an obligation or commitment, by the Province pursuant to this Agreement, is subject to: (a) (b) (c). there being sufficient monies available in an appropriation, as defined in the Financial Administration Act (R.S.B.C. 1996, c. 138) (the FAA ), to enable British Columbia in any fiscal year or part thereof when any such payment may be required, to make that payment; Treasury Board, as defined in the FAA, not having controlled or limited, pursuant to the FAA, expenditure under any appropriation referred to in section 1(a); and a report received from the local government that funds received to date have or are being used for the intended purposes and that public disclosure has or is being complied with in accordance with section 2 of this Agreement prior to funds being transferred. 2. ACCOUNTABILITY AND REPORTING TO RESIDENTS (a) Local governments receiving Funds will develop a plan that sets out the intended uses and performance targets for the Funds received from the Province. (b) By June 30 th and in each following year, the Local Government will report publicly on the plan under section 2(a), and progress made toward achieving performance targets for the Funds in accordance with those plans. 3. TERM This Agreement shall commence on the date that it is fully executed by both of the Parties and shall expire on June 30, Strategic Community Investment Funds Page 21 of 22

22 Agenda Item # 3b. 4. USES OF FUNDS If any of these funds are not required for their intend use, the Province reserves the right to redirect the funds for other purposes. SIGNATURES This Agreement has been executed on behalf of the Local Government by the duly authorized Corporate Officer pursuant to a resolution of the Council or Board, and on behalf of the Province, by the Deputy Minister, Ministry of Community, Sport and Cultural Development. Sun Peaks Mountain Resort Municipality HER MAJESTY THE QUEEN IN RIGHT OF THE PROVINCE OF BRITISH COLUMBIA as represented by the Deputy Minister of the Ministry of Community, Sport and Cultural Development Corporate Officer Deputy Minister Ministry of Community, Sport and Cultural Development Strategic Community Investment Funds Page 22 of 22