1 2017 Financial Plan Public Hearing April 18, 2017
2 Summary Organization Review – The new structure aligns the Maintenance and Engineering departments. This will allow for shared staffing and equipment within the seasonal departments. 2017 budget has been prepared with the goal of minimizing the impact of the Forestry Incentive Grant Project and Larose project as each represent significant operating costs. Various strategies to mitigate these impacts have been explored. Project Grant will be developed using Community Development Initiative Reserve (Bipole III) with the intention of ensuring employment and economic development within our community. Under direction of Council, Management has used a target of10% reduction as a general guideline, resulting in a 0% increase to the Municipal tax rate. Protective services continues to represent budget challenges. Recent settlements and projected future increases will have a significant impact on the operating budget. Highlighting the cost of Policing services is not intended as criticism, these are vital services for our community. Of concern are the wage increases provided through the Federal arbitration system and the impact that these increases have on the annual tax rate. Appropriation to Capital represents the amount that is allocated annually to capital that is generated by the tax levy. Upon review of capital appropriations it was determined that the amount could be reduced from by $230,000. Below is a chart showing the appropriations that were previously transferred and the reduction to the levy to accommodate this change. Reserve 2016 Appropriation 2017 Appropriation Expense Reduction Machinery Replacement 356,000 256,000 100,000 Computer Replacement 15,000 10,000 5,000 Airport 80,000 Fire Equipment 90,050 45,050 45,000
3 Summary – cont. Debt Cost – At the end of 2017 the Town will have $4.7M in debt. This debt is related to Wood Acres II, Multi-Plex, Wellness Center, and the Winton Pool upgrades. There is no plans for further debentures in Final payment for the Wood Acres II debenture will be December 31, Further information can be found on page 11 of the Financial Plan In April 2016 the Recreation Infrastructure reserve fund was established using Accommodation Tax dollars. A transfer from this reserve fund into operating revenue will be made annually with the specific purpose of subsidizing the Wellness Centre debenture payment. To mitigate increasing energy related costs, Council will continue with capital investments utilizing Hydro grants and reserve funds to upgrade to LED lighting, install parking controllers, and continue with feasibility studies. Revenue diversification is a strategy of Council moving forward, full review of existing user fees will take place and new fees may be identified as potential sources of revenue to ease the burden of the tax levy. Salaries / Wages and Benefits represent the most significant portion of the operating budget. Municipal workers are represented by the following groups: CUPE USW Fire Fighters Association Non-Union Staff Agreements within Town of The Pas are currently expired, and as a result of the current budget pressures the Town is facing a 0% increase has been incorporated. The impact of these measures will be monitored and Council will review annually.
4 Objectives of the Financial Plan HearingOverview of assessments and how they relate to your property taxes How the Forestry Incentive Grant affects the 2017 budget Provide residents with the opportunity to hear what is in store for 2017 and beyond as it relates to our 5 year capital plan
5 Objectives (con’t) For further detail or discussion, please contact Jodie Madden
6 Assessment and Property TaxesAssessments are completed every two years by Manitoba Municipal Government Assessment Services. The assessed value of property is the market value for that property should it have sold in a specific reference year, which is established by provincial legislation. The following are not taken into consideration for assessment purposes Residential driveways Residential landscaping such as trees, shrubs and flowers Residential fencing Assessment Services does not set the market value. The market creates the value, Assessment Services reports it. The Municipality uses the total value reported as one of the factors in determining the mill rates based on the net expenses that are required for services in the Town of The Pas. If you do not agree with your assessment, you may speak to an assessor. Contact information can be found on your notice of assessment. Should you still not agree, you may apply for a revision of the assessment to the Board of Revisions. Further information can be obtained by contacting Town of The Pas. For 2017 Assessment services has determined General Municipal value is $197M. Mass General Municipal Value Mill Rate: Required / Mass Value x 1000 Expenses 13,082,497 Revenues (7,175,763) Requirement 5,906,734 197,143,430 29.96
7 Assessment and Property Taxes (con’t)In recognition of the tax burden, Council has been committed to maintaining the same requirement as previous years (2014, 2015 & 2016). For 2017 an additional $963,000 was required. Through operational efficiencies, reduced reserve appropriations, service adjustments, increase in revenue, and reserve utilization, this requirement has been found without changes to the mill rate. Any changes to your tax statement will be a result of the increase or change in the assessment value of your property. For more detail please see page titled 2017 Property Assessment included with this presentation.
8 The 2017 Financial Plan consists of the following:2017 KSD / Provincial Requirement 2017 Annual Budget 2018 Proposed Estimates 2017 Capital Estimates 5 year Capital Expenditure Program
9 The 2017 Financial Plan GoalsElimination of the transfer from surplus resulting in a $300,000 reduction in revenue. Forestry Grant Project implemented resulting in an additional $451,000 expense. Additional $161,800 required for RCMP services. Continued investment in maintenance for extension of infrastructure assets
10 Education Levy Represents 22% of expendituresTown of The Pas is required to collect the education levies as per the Municipal Act The total amount payable to KSD in 2017 will be $3,309,939, this amount is collected by applying a mill rate of to all residential and commercial properties The total amount payable to the province will be $656,354 this amount is collected by applying a mill rate of to all commercial properties The 2017 Education levies increased a total of $4,290, resulting in no change to the mill rate If you want information regarding how the Education amount on your Property Tax Bills is spent please contact the Kelsey School Division as below: 322 Edwards Avenue Box 4700 The Pas, MB R9A 1R4 Phone (204) Fax (204)
11 Police Services Represents 16% of Expenses7% increase from prior year due to contract settlements Federal Treasury Board designs compensation, salaries are beyond municipal control, however these costs must be raised by property taxation. Municipal taxpayers across Canada subsidize the federal governments policing cost at the rate of approximately 58.7% or $8.1B per year FCM, Statistics Canada Police Resources,
12 General Government Approximately 12% of budgetReduction of 6% from 2016 budget Budget reductions include indemnity reduction, WCB premium savings, and departmental efficiencies. Admin – Salaries, Legal Fees, Insurance, Building – Utilities and general maintenance Other – Audit fees, Taxation, Assessment, Conventions Grants – continued on next page
13 General Government Grants provided to External Organizations 4% of 2017 Expenses2016 2017 Highest Academic 2,500 School Involvement 1,000 Community service Sam Waller Bursary 500 UCN KLC - Ed Johanson Bursary Recycling Center 109,000 93,570 OCN Blizzard 5,000 Northern Juried Art Show Golden Agers Community Grants 20,000 Handi-van 15,000 Handi-van vehicle Northern Gateway Chaplaincy The Pas Arts Council 4,000 COP - Graffiti program Trappers Grant 750 Trappers Insurance 2,009 CDC Forestry Incentive 451,002 189,259 623,331 There has been a large increase from prior year. This increase is due to the implementation of the Forestry Incentive Grant Project– This grant will be available for three years, CDI reserve (BiPole III) will fund this Grant Project CDC Grant in the amount of $82,800 is not funded by taxation, Community Enhancement reserve is used for payment of this grant.
14 Garbage and Waste ManagementProvides waste management services to residents and businesses within Town of The Pas and surrounding areas, promoting diversion through recycling, reusing, and composting. Represents 3% of the 2017 Budget There has been no change from the 2016 budget
15 Recreation and Cultural Services2017 2016 Kelsey Rec Center 741,396 828,127 Wellness Center 180,000 200,000 Sam Waller Museum 131,979 146,671 The Pas Public Library 134,100 149,000 Represents 8% of 2017 budget Reallocation of grant funding between KRC and Wellness Center Budget has reduced 11% due to service adjustments, increased revenues and operational efficiencies
16 Fire Department Our department is dedicated and programs are designed to protect the lives and property of the residents and visitors of the Fire Department’s response area from the adverse effects of fires, sudden emergencies or exposure to dangerous conditions created by man or nature and includes fire prevention, public education, rescue and suppression services 3% of 2017 Budget Budget of the Fire department remains unchanged from 2016 Department consists of Fire Chief, Chief Fire Prevention Officer, Public Safety Officer and approximately 22 volunteers If you are interested in applying for a position on the Volunteer Fire Department forms can be picked up at the Municipal Office during regular business hours
17 Public Works 8% of budget for 2017Engineering and Public Works oversee the evaluation, planning, and operations related to municipal roads, water, sewer, and drainage systems. The department also administers the Waste Management Program which involves the provision of services for the collection and processing of solid wastes in the municipality and ensures that the residents in our municipality have sufficient, safe potable water to drink. 8% of budget for 2017 Reduction of 10% as a result of operational efficiencies, shared resources with Maintenance department
18 Airport Air transport plays a critical role in The Pas and surrounding communities, Town of The Pas Airport strives to provide a safe and secure environment for all visitors by ensuring legislative standards are met. 6% of the 2017 Budget Decrease from 2016 of 10%, appropriation to the reserve fund has been eliminated. Capital purchases are largely funded by ACAP, therefore these revenues will be used to offset Airport expenses.
19 Debentures Represent 5% of the 2017 BudgetWood Acres II - the purpose of paving the streets in Wood Acres II Residential Subdivision in 2006 Multi-Plex – Phase I of improvements to the multi-use recreation facility Wellness Center – Phase II of Multi-Plex being the Wellness Center and parking lot Winton Pool – renovations to the Winton Pool swim walls and ceiling beam 2017 Payment Maturity Date Wood Acres II - #4358 150,918 2019 Multi-Plex - #4381 169,099 2025 Wellness Center - #4435 206,615 Winton Pool - #4486 191,447 2027
20 Capital Reserves Represent 12% of the 2017 Budget2016 2017 General 67,908 83,861 Civic Center Machinery 356,000 256,000 Election 2,500 Museum 5,000 Infrastructure 100,000 3,246,666 Computer 15,000 10,000 Library 14,000 7,500 Gas Tax** 305,042 297,773 Bipole III** 233,000 245,815 Fire Fighting Equipment** 90,050 45,050 Waste Disposal Grounds** 131,500 67,250 Community Enhancement** 87,500 Destination Marketing** 43,750 Recreation infrastructure** These funds receive annual contributions from the operating budget to assist with creating a solid financial position to support future cash requirements. Maintaining sufficient balances in reserves is critical to the Municipality’s long-term financial plan, they help to minimize fluctuations in the tax rate, and provides funding to sustain infrastructure Reserves marked with ** are an allocation of accumulated net revenue, ie. Waste Disposal Grounds is made up of all bag tags, tipping fees, and pickup fees collected by the municipality.
21 2017 Capital Reserve WithdrawalsReserve withdrawals total $5,714,081 Larose Avenue Renewal Wellness Center Equipment Runway Sweeper for Airport Withdrawal from Recreation Infrastructure reserve to subsidize Wellness Center debenture payment Forestry Stabilization Project Grant Detailed list can be found on page 13 of the 2017 Financial Plan
22 2016 vs. 2017 Mill Rate Comparison**Assume a 0% increase from the 2016 assessment value Residential 2016 Assessment value $170,000 2017 Assessment Value $170,000 Increase (Decrease) At Large 29.96 Debenture 3.24 KSD 17.34 17.33 (0.01) Mill Rate 50.54 50.53 Property Tax 3,866.31 3,865.54 (0.77) Commercial 2016 Value $234,000 2017 Increase (Decrease) At Large 29.96 Debenture 3.24 KSD 17.34 17.33 (0.01) Provincial Education 10.50 Mill Rate 61.04 61.03 (0.01 Property Tax 9,284.18 9,282.66 (1.52)