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RegDoc 5
RegDoc 5
RECOMMENDATION(S):
That Council give first, second and third reading to the Langley 2009 – 2013 Five Year Financial
Plan Bylaw 2009 No. 4738; and further
That Council give first, second and third reading to the Development Cost Charge Reserve
Fund Expenditure Bylaw 2009 No. 4739.
EXECUTIVE SUMMARY:
The Community Charter requires Council to adopt the Langley 2009 – 2013 Five Year Financial
Plan Bylaw before the Annual Tax Rates Bylaw and no later than May 14, 2009. The Five
Year Financial Plan Bylaw No. 4738 will establish the budget for revenues, expenditures, and
transfers for 2009 – 2013 for the Township’s funds.
The 2009 operating budget includes non-discretionary adjustments for salary and wage
increases for staff, annualization of costs pertaining to 2008 new programs and/or services,
contract commitments and minor inflationary adjustments for such items as natural gas and
electricity. The only service enhancement is the implementation of full time fire service at
Walnut Grove Fire-hall.
The 2009 Township budget reflects a 5% property tax and levy rate increase for all funds except
for the Solidwaste (garbage collection) which is slightly higher to fund the increased new
garbage collection contract. The 2009 revenue increase was achieved through a reduction of
funding to capital projects elimination of some vacant staff positions and other measures in
order to reduce the impact of the major cost drivers.
For 2009, the impact to a typical household with all services and with property assessed at
approximately $473,000 is an increase of $121 for the year or $10 per month. The total
municipal bill for this household receiving all services increases from $2,021 in 2008 to $2,142
in 2009; and for a household not receiving water, sewer or garbage collection the municipal bill
increases from $1,283 in 2008 to $1,347 in 2009. Fire, Police and Transportation account for
the majority of the tax increase.
In the table below, showing the 2009 property tax and levy increase allocation, universal
services are paid for by all taxpayers while user pay services are only paid for by those who
subscribe to the particular service.
2009 – 2013 FIVE YEAR FINANCIAL PLAN BYLAW and
2009 DEVELOPMENT COST CHARGE RESERVE FUND EXPENDITURE BYLAW
Page 2 . . .
In accordance with the Community Charter disclosure requirements, the Langley 2009 – 2013
Five Year Financial Plan Bylaw 2009 No. 4738 will also discloses the following information:
• the proportions of revenue proposed to come from the various funding sources
• the distribution of property taxes among property classes; and
• the use of permissive tax exemptions.
In addition, Council must adopt a Development Cost Charge Reserve (DCC) Fund Bylaw
authorizing the expenditure of funds from the DCC Reserve. Development Cost Charge
Reserve Fund Bylaw 2009 No. 4739 will authorize the expenditure of funds from the
Development Cost Charge Reserve for 2009 DCC capital projects as well as DCC capital
projects in progress from prior years (carryforwards).
PURPOSE:
The purpose of this report is to bring forward the 2009 – 2013 Five Year Financial Plan and the
2009 Development Cost Charge Expenditure Bylaws for the first three readings.
2009 – 2013 FIVE YEAR FINANCIAL PLAN BYLAW and
2009 DEVELOPMENT COST CHARGE RESERVE FUND EXPENDITURE BYLAW
Page 3 . . .
DISCUSSION/ANALYSIS:
2009 – 2013 Five Year Financial Plan
The 2009 – 2013 Five Year Financial Plan was developed based on resolutions and information
from various discussions with Council and the Finance Committee. Council received the results
of the public consultation on the 2009-2013 Financial Plan on April 3, 2009 and is scheduled to
hear more input at the Council meeting on April 6, 2009.
The 2009 – 2013 Five Year Financial Plan includes property tax growth for 2009, from new
construction, estimated at $2.06 million, one-time adjustments and operating carryforwards
representing projects and programs in progress to be completed in 2009. A listing of the 2009
Capital requests is attached as Attachment “C”.
Parks Utility is a new utility being proposed in 2009. The utility includes all park design,
acquisition, maintenance and any other related activities such as trails, park amenities, and
boulevard trees. Major funding is through property tax revenue based on property assessments
as these are universal services. The establishment of the Parks Utility enables the Township to
better communicate with taxpayers through isolating the cost of providing this service.
The 2009 Provisional Operating and Capital budget reflects non-discretionary expenditures
identified for 2009 based on ongoing contracts and implementation of a new fire hall as
approved by Council in 2008. Revenues are reflected based on a 5.0% property tax and levy
increase for 2009 plus funding from new construction projected at a growth rate of 2.0 % for
property tax assessments and 3% growth factor for water, sewer and solid waste.
Major incremental cost drivers for the 2009 Budget include the following:
Amount
Salary, Wages, Benefits & other $ 3,589,000
Firehall to full time service - salaries $ 1,376,000
Other contract cost increases & utilities $ 1,414,000
Policing contract increase $ 1,355,000
Garbage collection contract increase $ 1,200,000
Recycling contract increase $ 1,200,000
Sewer Levy/Water purchase/Provision for debt $ 979,000
Total $11,113,000
Property Taxation
The household impact of a 5% increase on property taxes & levies for a property assessed at
$473,000 receiving all utility services is an additional $121 for the year of $10 per month. The
total municipal bill for a household receiving all services increases from $2,021 to $2,142 per
year or $179 per month. For a property not receiving water, sewer and garbage collection
services the additional cost is $64 for the year or $5 per month and the total municipal bill
increases from $1,283 to $1,347 per year or $112 per month.
2009 – 2013 FIVE YEAR FINANCIAL PLAN BYLAW and
2009 DEVELOPMENT COST CHARGE RESERVE FUND EXPENDITURE BYLAW
Page 4 . . .
Capital Funding
Capital projects are only partially funded from General and Utility Funds revenues with the
majority of the funding coming from sources such as reserves and surplus, development cost
charges receipts, senior government grants, local area service funds and as a last resort from
debt financing.
Debt financing is a viable method of funding long term capital projects which provide a benefit to
current and future taxpayers. This method ensures that all that will benefit will pay for the
projects over time. It is difficult to save for large infrastructure projects, therefore borrowing
ensures that required infrastructure is not unreasonably delayed and the annual payments are
manageable. The debt servicing, principal and interest, cost for $10 million borrowed for 20
years is $940,000 per year.
The table below shows potential debt reflected in the 2009 to 2013 Five Year Financial Plan for
various capital projects. The amounts for the years subsequent to 2009 and 2010 are potential
debt which can be borrowed externally or internally and which will be decided upon in future
years.
Carryforward
Potential Debt in $000’s 2009 2010 2011 2012 2013
from 2008
Transportation 4,763,367 7,568,925 - - - -
Sewer 8,500,000 - - - - -
Water 4,500,000 - - - - -
Stormwater 7,001,000 - - - - -
The new Public Sector Accounting Board recommendations for accounting for tangible capital
assets now requires us to record all tangible assets on the balance sheets, amortize all tangible
assets and record the amortization expense on the income statement. The amortization
expense is comparable to putting money aside in reserves for future capital renewal or
replacement. Staff are working on implementing these guidelines and will report to Council
when the work is completed.
The financial plan must set out the objectives and policies of the municipality for the
planning period in relation to the following:
(a) for each of the funding sources (property value taxes, parcel taxes, fees other
sources, and borrowing), the proportion of total revenue that is proposed to come from
that funding source
(b) the distribution of property value taxes among the property classes that may be
subject to the taxes
(c) the use of permissive tax exemptions
The data presented below, which will form part of the Langley 2009 – 2013 Five Year Financial
Plan Bylaw 2009 No. 4738, is based on past practices and discussion on changes to these
established allocations will follow in future budget sessions.
The proportion of total revenue raised from each funding source in 2009 is presented in the
table above. Property taxes form the greatest proportion of the operating revenue for the
Township. Property taxes provide a stable and consistent source of revenue for many services
that are difficult or undesirable to fund on a user-pay basis. These include services such as fire
protection, policing services, transportation and so forth. For these reasons, property taxation
will continue to be the major source of the Township’s revenue.
User fees and charges is the second largest portion of general operating revenue. Many
Township services, such as water, sewer, and garbage collection are charged on a user-pay
basis which ensures they are paid for by the taxpayers receiving these services.
The distribution of property tax revenue among the various property classes is presented in the
table above. The practice of Council has been to set tax rates in order to maintain reasonable
tax stability in compliance with the Community Charter. This is accomplished by maintaining the
proportionate relationship provided above between the property classes. (Property classes are
defined and values determined by the British Columbia Assessment).
Respectfully submitted,
Hilary Tsikayi
DIRECTOR
for
FINANCE DIVISION
ATTACHMENT “A” Langley 2009 – 2013 Five Year Financial Plan Bylaw 2009 No. 4738
LANGLEY 2009 - 2013 FIVE YEAR FINANCIAL PLAN BYLAW 2009 NO. 4738
EXPLANATORY NOTE
The 2009 - 2013 Five Year Financial Plan Bylaw No. 4738 authorizes the expenditure of
funds for the Municipality. The 2009 - 2013 Five Year Financial Plan Bylaw is prepared
pursuant to Section 165 of the “Community Charter” and is required to be adopted by Council
prior to the Tax Rates Bylaw and May 14, 2009.
An expenditure that is not provided for in the 2009 - 2013 Five Year Financial Plan is not
lawful.
ATTACHMENT A
Langley 2009 - 2013 Five Year Financial Plan Bylaw 2009 NO. 4738
A bylaw to establish the Five Year Financial Plan from 2009 to 2013.
WHEREAS Section 165 of the “Community Charter” requires that the Corporation of the Township of
Langley adopt a Five Year Financial Plan prior to approval of the Tax Rates Bylaw by May 14, 2009:
NOW THEREFORE, the Local Government Council of The Corporation of the Township of Langley, in
Open Meeting Assembled, ENACTS AS FOLLOWS:
1. This bylaw may be cited for all purposes as the “Langley 2009 - 2013 Five Year Financial Plan
Bylaw 2009 No. 4738.”
2. Schedule “A”, being the Financial Plan, attached hereto and forming part of this bylaw is hereby
adopted as the 2009 - 2013 Five Year Financial Plan of The Corporation of the Township of
Langley.
3. Schedule “B”, being the Revenue Plan Objectives and Policies, attached hereto and forming part
of this bylaw is hereby adopted as the 2009 - 2013 Five Year Financial Plan of The Corporation of
the Township of Langley.
REVENUES
Operating Plan
General Property Taxes 53,880,696 57,666,466 61,717,240 66,051,568 70,689,298
Other Levies
Transportation Levy 13,516,181 14,467,353 15,485,108 16,574,106 17,739,333
Stormwater Levy 5,116,088 5,476,053 5,861,216 6,273,340 6,714,312
Parks Levy 5,302,006 5,673,147 6,070,267 6,495,186 6,949,849
23,934,275 25,616,553 27,416,591 29,342,631 31,403,494
Sale of Services
Water User Rates 10,471,816 11,204,843 11,989,182 12,828,425 13,726,415
Sewer User Rates 8,172,423 8,744,493 9,356,607 10,011,569 10,712,379
Solid Waste User Rates 3,270,172 3,835,575 4,352,860 4,461,681 4,573,223
Other Sale of Service 17,122,039 17,133,289 17,144,819 17,156,639 17,168,754
39,036,450 40,918,200 42,843,468 44,458,315 46,180,772
Other Revenues 15,871,298 15,581,996 15,653,182 15,726,147 15,800,936
Transfer from Prior Year's Surplus 16,520,332 464,080 - - -
Transfer from Other Funds & Reserves 4,033,985 4,040,150 5,842,864 2,601,681 2,348,671
Operating Plan Sub-Total 153,277,037 144,287,446 153,473,345 158,180,342 166,423,172
Capital Plan
Contribution from Current Year Revenue 6,655,715 5,807,823 8,175,642 10,710,354 12,738,433
Grants 12,140,451 1,399,578 1,399,578 1,399,578 1,399,578
Transfer from Prior Year's Surplus 35,302,537 - - - -
Transfer from DCC Reserves 38,197,893 10,450,716 11,335,732 10,345,644 10,938,911
Transfer from Reserves 37,169,755 21,492,609 22,160,109 21,402,409 22,954,909
Private Funds and Other Sources 27,345,897 6,659,325 6,409,825 6,343,075 6,500,075
Debt - Internal and External 32,333,292 - - - -
Capital Plan Sub-Total 189,145,540 45,810,051 49,480,886 50,201,060 54,531,906
Langley 2009 - 2013 Five Year Financial Plan Bylaw 2009 NO. 4738
In accordance with the Community Charter disclosure requirements the Township of Langley
discloses the following information.
• the proportions of revenue proposed to come from the various funding sources
• the distribution of property taxes among property classes; and
• the use of permissive tax exemptions.
The proportion of total revenue raised from each funding source in 2009 is presented in the table
above. Property taxes form the greatest proportion of the operating revenue for the Township.
Property taxes provide a stable and consistent source of revenue for many services that are difficult or
undesirable to fund on a user-pay basis. These include services such as fire protection, policing
services, transportation and so forth. For these reasons, property taxation will continue to be the
major source of the Township’s revenue.
User fees and charges is the second largest portion of general operating revenue. Many Township
services, such as water, sewer, and garbage collection are charged on a user-pay basis which
ensures they are paid for by the taxpayers receiving these services.
Bylaw No. 4738 ATTACHMENT A
Page 2 …
The distribution of property tax revenue among the various property classes is presented in the table
above. The practice of Council has been to set tax rates in order to maintain reasonable tax stability
in compliance with the Community Charter. This is accomplished by maintaining the proportionate
relationship provided above between the property classes. (Property classes are defined and values
determined by the British Columbia Assessment).
EXPLANATORY NOTE
Bylaw No. 4739 provides for the 2009 Capital Expenditure Program from the Development
Cost Charge Reserve Fund as provided by the 2009 – 2013 Five Year Financial Plan. The
projects are for road, stormwater, sewer, water services and for parkland acquisition and
development.
The Roads, Water, Sewer, Stormwater, Parkland Acquisition and Park Development DCC
Reserves do not currently have sufficient funds to cover the expenditures included in the
2009 – 2013 Five Year Financial Plan. However, these expenditures have been included in
the DCC Expenditure Bylaw in the event that enough DCC funds are received during the
year. Projects will only proceed when sufficient funds are available.
Funds that become available in the Parkland Acquisition DCC Reserve, Water DCC Reserve
and Stormwater DCC Reserve, and Roads DCC Reserve are first directed towards payment
of the annual debt.
Presently, there are estimated expenditures under the bylaw in the amount of $26,265,977
for the Capital Carryforwards from prior years and $15,221,482 for the 2009 Current Year
Capital for a total expenditure of $41,487,459.
Should any of the above-noted monies remain unexpended at the end of the project; the
unexpended balance will be returned to the credit of the reserve fund.
ATTACHMENT B
WHEREAS it is deemed expedient to expend monies set aside in the Development Cost
Charge Reserve Fund established pursuant to Bylaw 1980 No. 1946 and interest earned
thereon for the following purposes:
NOW THEREFORE, the Municipal Council of The Corporation of the Township of Langley, In
Open Meeting Assembled, ENACTS AS FOLLOWS:
1. This bylaw shall be cited as “Development Cost Charge Reserve Fund Expenditure
Bylaw 2009 No. 4739”.
2. There is hereby authorized to be expended from the monies set aside and any interest
earned thereon pursuant to the Bylaw entitled “Development Cost Charge Reserve Fund
Bylaw 1980 No. 1946”, a sum not exceeding Forty One Million Four Hundred Eighty
Seven Thousand Four Hundred Fifty Nine Dollars ($41,487,459) for capital improvements
and debt repayment as aforementioned.
3. Should any of the above-mentioned funds remain unexpended, after the expenditures
hereby authorized have been made, the unexpended balance shall be returned to the
credit of the said Reserve Fund.
Township of Langley
2009 - 2013 Capital Plan Summary
DIVISION SUMMARY
EXPENDITURES
FUNDING SOURCES
TOTAL FUNDING SOURCES 110,169,588 78,975,953 189,145,541 40,605,064 44,275,899 44,996,073 49,326,919
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
DIVISION SUMMARY
CAPITAL CAPITAL FUNDING
New General Federal/ DCC's Capital Equipment Land Water/ Prior Other Total
Requests Revenue Provincial Works Reserve Reserve Sewer/Storm Year's Funding
Grants Surplus Surplus
TOTAL DIVISIONS 78,975,952 6,655,714 1,363,802 11,931,916 - 1,426,700 17,450,000 - 9,650,070 30,497,750 78,975,952
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
CORPORATE ADMINISTRATION
CAPITAL CAPITAL FUNDING
New General Federal/ DCC's Capital Equipment Land Water/ Prior Other Total
Requests Revenue Provincial Works Reserve Reserve Sewer/Storm Year's Funding
Grants Surplus Surplus
TOTAL CORPORATE ADMINISTRATION 17,650,522 648,317 580,135 - - - 15,000,000 - 915,070 507,000 17,650,522
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
FINANCE
CAPITAL CAPITAL FUNDING
New General Federal/ DCC's Capital Equipment Land Water/ Prior Other Total
Requests Revenue Provincial Works Reserve Reserve Sewer/Storm Year's Funding
Grants Surplus Surplus
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
COMMUNITY DEVELOPMENT
CAPITAL CAPITAL FUNDING
New General Federal/ DCC's Capital Equipment Land Water/ Prior Other Total
Requests Revenue Provincial Works Reserve Reserve Sewer/Storm Year's Funding
Grants Surplus Surplus
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
FIRE
CAPITAL CAPITAL FUNDING
New General Federal/ DCC's Capital Equipment Land Water/ Prior Other Total
Requests Revenue Provincial Works Reserve Reserve Sewer/Storm Year's Funding
Grants Surplus Surplus
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
POLICE
CAPITAL CAPITAL FUNDING
New General Federal/ DCC's Capital Equipment Land Water/ Prior Other Total
Requests Revenue Provincial Works Reserve Reserve Sewer/Storm Year's Funding
Grants Surplus Surplus
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
TOTAL PARKS UTILITY 12,924,922 885,931 100,000 10,149,916 - - - - 730,000 1,059,075 12,924,922
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
Township of Langley
2009 Capital Projects - New Requests
TOTAL TRANSPORTATION FUND 15,299,341 1,511,916 567,000 742,500 - 1,194,000 2,450,000 - - 8,833,925 - 15,299,341
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
New Utility Federal/ DCC's Capital Equipment Land Water/ Prior Other Total
Requests Revenue Provincial Works Reserve Reserve Sewer/Storm Year's Funding
Grants Surplus Surplus
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other
ATTACHMENT C
Township of Langley
2009 Capital Projects - New Requests
OTHER:
(1) Capital Surplus; (2) Landfill; (3) MFA; (4) Non-Refundable Deposits; (5) Langley City; (6) ICBC; (7) LIP Reserve; (8) Translink; (9) Other