Council Approves Preliminary Budget

As many of you would know, Council has been deliberating on the 2012 budget for the last few weeks. On Thursday, March 8^th (International Women's Day – and I hope you did not forget to honour the women in your life), Council concluded the first part of deliberations by approving a 'provisional' budget pending further adjustments that may be recommended as part of the Business Systems Review, which is underway. Council had to deal with infrastructure and capital pressures, impact on the taxpayers, and maintaining a decent level of services for the community. It is a complex exercise like in a puzzle, putting all the pieces in the right place will cause a harmonious picture to be created. But a budget is not a work of art. It is, rather, a forecast which remains slightly prone to changes as the unpredictability which comes with it unfolds throughout the year. For instance, because of the economic crisis (which does not seem to be getting better), much of the revenue forecast from building inspections, engineering fees and land use applications in 2011 was a disappointment, therefore new targets needed to be set for 2012.

The focus of the budget exercise for this year has always been to minimize the overall impact on the taxpayers, knowing that in order to maintain the same level of services we would have to keep up with inflation. In addition, it was necessary to increase the funding for capital works as it is very low compared to other municipalities with similar population. At the end, Council decided to adopt a preliminary budget with an inflationary increase of 2.5% for property taxes and to reduce the proposed water fee increase necessary to carry on with our water master plan to less than half of the original proposal ($49 instead of $114). All other fees will remain the same. This will accomplish a few things:

• The operating budget, which includes the general fund that comes from property taxes, the water fund and the sewer fund, both of which come from user fees, will see a slight increase (less than 1.4%) to factor in some contractual obligations that will also increase due to inflation;
  
• The portion of the capital budget funded through property taxes (general fund) will increase from about $350,000 last year to $410,000 this year. This is good for the community as 50% of our infrastructure will need to be properly repaired, maintained and replaced in the next 20 years. To put things into perspective, the District would need between $1 and $2 million a year in property taxes to take care of our assets (roads, water and sewer systems, parks, etc.);
  
• The capital program for 2012 will be just shy of $9.8 million which is almost the same as last year.
  

All this with the lowest tax increase ever in the history of Lake Country (the lowest tax increase prior to this was 3.2% in 2007). Kudos to Council. They had the leadership to direct staff to prepare a budget that would address their strategic priorities, guarantee the same level of services (or in other words quality of life) and begin to address our infrastructure needs properly. This is a visionary effort which will pay back in the next few years and in the long run. Further adjustments may be made once the business systems review is concluded. But those adjustments will mean either less taxes or more money for capital projects.

To bring perspective to the numbers, the municipal portion of the tax bill we pay is only 52% of the whole (in other words on $1,000 collected, $520 go to the municipality and $480 go to other agencies, such as the province, the regional district, BC assessment and the likes). A 1% tax increase equates to $2.94 for every $100,000 of assessed value. To make things simpler, if your home is assessed at $500,000 a 1% increase would be $14.70. So a 2.5% increase would be $36.75 for the whole year. This year, the District will complete the following major capital projects:

• Lodge Road reconstruction for a total of $1.6 million;
  
• The Kalamalka Lake Booster Station, UV Treatment and Reservoir, which will improve water quality in Oyama, for a total of $4.2 million;
  
• Sanitary Sewer works in various areas of the District for a total of $780,000;
  
• Beasley Park upgrades, including works at the Community Centre, a Park 'n' Ride, and parking lot improvements for about $1 million;
  
• Swalwell Park parking lot and Farmers Market for $220,000;
  
• A number of road and pedestrian safety improvements in different locations, including Bond Road, Sherman Road, and Beaver Lake Road for a total of $150,000.
  

A copy of the budget package is available online at www.lakecountry.bc.ca. If you have any questions about the budget and the process for its approval, call the Finance Department at 250-766-5650.

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