Information or Crystal Ball Reading?

The District of Lake Country is in the middle of budget deliberations and Council received information from staff in a meeting held in December. As I mentioned in a previous blog, we are trying to approve the budget and the 5-Year Financial Plan as early as possible and February is our goal, long before the mandated May 15^th deadline provided by the legislation. We are aware of some discussion at the public level and in some circles with some venturing to guess what the tax increase would be this year (I heard 4.5% is one of the figures). As the Administrator of the District I would love to see into the future and provide an exact forecast of Council's decision about all matters regarding the community, including a possible tax increase. It would alleviate much stress and unnecessary conflict. However, I can certainly provide existing information that may help people understand the complexity of the budget exercise and the decision-making process Council has to go through.

The first point to make is that Council has not made any decision yet on the budget. In order to assist them in making their decision, they received important information in December and they will receive a detailed package this week with some options and recommendations from staff. Council has no obligation to accept those recommendations. Instead, it has the option to provide direction for future consideration.

In the December meeting, Council learned some important facts:

• There is an inflationary increase of 2.4% for all contractual obligations and purchased services, which will have to be accounted for in the District's operational budget;
  
• There are budget increases from two major service providers to the community, the RCMP and BC Transit, that also affect our bottom line: the RCMP cost is increasing $135,000 and BC Transit is increasing $61,000;
  
• The total net increase due to what I just described (inflation, RCMP, and BC Transit) is $460,000, which is needed to balance the operational budget;
  
• 1% increase in taxes raises only $79,000;
  
• To the individual residential taxpayer, a 1% tax increase translates in $2.75 for each $100,000 of assessed value;
  
• Of the total amount people pay in taxes to the municipality every year, only half goes to the District. The rest goes to the province and the regional district.
  

Council also learned that the average tax increase in the last 5 years has been 4% and that it has been lower than the previous 5 years. A 4% increase would result in an extra $11 for each $100,000 of residential assessed value. In other words, if a house is assessed $500,000, a 4% tax increase would be $55.

Nobody wants a tax increase, no matter how small, but the community owns important infrastructure that needs to be fixed, replaced and regularly maintained. We receive feedback from the citizens, either directly or through our Council members, and people expect that the roads will be in good conditions at all times, that when they turn on the tap the water will come out, that their sewer will receive the by-product of their daily activities with efficiency and no problems, and so on. We also know that there is a general concern for the safety of our roads, especially with respect to pedestrian traffic.

Council understands that there is a cost associated to all this and that we are living in tough times. I personally do not envy them as they go through these deliberations. However, I admire them for their leadership and courage to even be in the hot seat, something that not many would gladly do. It is also frustrating for them and the community when for each $100 of all the taxes we pay each year, $92 go to the federal and provincial governments and only $8 go to municipalities. To make things worse, the federal and provincial governments do not have to balance their budgets, like we have to, and for political reasons they keep downloading to municipalities functions that are traditionally in their realm without any funding to support the new programs, which makes the $8 value even more skewed.

I wish to invite all of the readers to come to our January 25^th Council meeting and observe. If you have concerns, please tell us and we will take those to Council. I am confident that our residents will find answers to their questions. The meeting starts at 7pm.

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