Municipality of North Cowichan2012-2016 Capital Budget Review

February 6th, 2012

Class 4 ChallengesCatalyst Paper comprises 88.8% of Class 4 taxes. Their 2011 general municipal taxes were $5.6 million and 26% of North Cowichan’s property tax revenue. The company is suffering significant financial hardships and have now commenced proceedings under the Companies’ Creditors Arrangement Act (CCAA).

Challenges Reduce North Cowichan’s dependency on a single tax payer Transfer the tax burden to other tax classes

Financial Risk to North Cowichan’s Revenue There is the potential for a dramatic reduction in major industry

assessment in the event of a mill closure The company could default on their 2012 taxes

5 Year Tax Increases

2012 2013 2014 2015 2016

Gross tax increase 7.95% 5.17% 5.02% 4.99% 4.86%

Less: Growth 1.50% 1.50% 1.50% 1.50% 1.50%

Net Tax Increase 6.45% 3.67% 3.52% 3.49% 3.36%

Less: Capital increase/(decrease)

1.26% 1.81% 1.83% 1.60% 0.28%

Net Operating TaxIncrease

5.19% 1.86% 1.69% 1.89% 3.09%

Increase per Average Home

61 39 38 39 40

Increase per $100,000 assessment

18 11 11 12 12

Potential Cost Savings

Operating2012

Original2012

Amended2012

Savings

Human Resources – Training/Assess. 14,000 7,000 7,000

Legal Fees 102,000 75,000 27,000

RCMP Building Maintenance 53,860 30,000 23,860

Street Lighting 359,000 332,000 27,000

Supervision and Flat Rate Equipment 26,530 16,530 10,000

Drainage Study 50,000 - 50,000

Tipping Fees 387,375 377,000 10,375

Zoning Bylaw Revision 40,000 20,000 20,000

University Village Plan 60,000 30,000 30,000

Cowichan Aquatic Centre 1,410,198 1,295,451 114,747

Muni Hall Building – Interest 37,500 - 37,500

Total Savings 2,587,463 2,229,981 357,482

5 Year Tax Increases - Updated for Savings

2012 2013 2014 2015 2016

Gross tax increase 5.81% 7.52% 4.80% 4.99% 4.86%

Less: Growth 1.50% 1.50% 1.50% 1.50% 1.50%

Net Tax Increase 4.31% 6.02% 3.52% 3.49% 3.36%

Less: Capital increase/(decrease)

.80% 2.29% 1.83% 1.60% 0.28%

Net Operating TaxIncrease

3.51% 3.74% 1.47% 1.89% 3.09%

Increase per Average Home

41 61 36 39 40

Increase per $100,000 assessment

12 18 11 12 12

Capital Fund Revenue Sources Property Taxes (Target $3.4 million – recommended 15% of

Property Taxes) 2012 Proposed Budget - $3,046,280 (13.22%) 2011 Budget - $2,776,520 (13.00%)

Potential Property Tax Savings Funding Genoa Bay Road Rock Scaling through the Roads Program -

$100,000

2012 Proposed Budget with Savings - $2,946,280 (13.04%)

Sources of Financing Capital projects are financed through a variety of sources

including: General Revenue Gas Tax Revenue Appropriated Surplus Reserve Funds Development Cost Charges Government Grants Other Contributions Debt

Only general revenue is funded directly from property taxes

2012-2016 Capital Budget Overview2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

General Government 10,000 50,000 10,000 10,000 10,000

Land Acquisition & Development 1,770,000 180,000 570,000 170,000 170,000

Municipal Property Improvements 3,203,350 208,000 212,160 216,403 220,731

Information Services 239,000 234,790 204,790 249,790 254,790

Community Development 2,280,000 2,440,000 925,000 2,600,000 1,550,000

Protective Services: Police & Other 500,000 - 4,000,000 4,000,000 -

Protective Services: Fire 29,400 488,388 30,000 507,805 30,400

Forestry - - - 36,000 36,000

Transportation 14,624,636 8,495,900 4,682,486 5,034,703 4,907,103

Parks & Culture 351,830 344,380 469,670 469,960 445,960

Total 23,008,216 12,441,458 11,104,106 13,294,661 7,624,984

2012-2016 Capital Budget Overview2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

General Revenue 3,046,280 3,462,570 3,907,270 4,315,603 4,339,281

Gas Tax Revenues 791,000 791,000 791,000 791,000 791,000

Appropriated Surplus 895,000

Reserve Funds 4,543,561 2,287,888 1,042,836 2,413,058 1,084,703

Development Cost Charges 167,000 190,000 403,000 220,000 230,000

Government Grants 8,864,667 3,986,667 600,000 1,175,000 800,000

Other Contributions 979,708 737,333 60,000 80,000 80,000

Short Term Debt 137,000

Debenture Debt 3,584,000 986,000 4,300,000 4,300,000 300,000

Total Sources of Financing 23,008,216 12,441,458 11,104,106 13,294,661 7,624,984

2012-2016 General Government2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

Office Furniture & Equipment 10,000 10,000 10,000 10,000 10,000

Office Vehicles 40,000

Total General Government 10,000 50,000 10,000 10,000 10,000

General Revenue 10,000 10,000 10,000 10,000 10,000

Office Vehicle Reserve 40,000

Total Sources of Financing 10,000 50,000 10,000 10,000 10,000

Sources of Financing

2012-2016 Land Acquisition & Development2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

Land Acquisition 120,000 120,000 120,000 120,000 120,000

Land Development 60,000 60,000 50,000 50,000 50,000

Total Land Acquisition &Development 1,770,000 180,000 570,000 170,000 170,000

Sale of Land Reserve 1,770,000 180,000 570,000 170,000 170,000

Sources of Financing

Hwy 18 Industrial Lots 950,000

Cassino Road Development 640,000 400,000

2012-2016 Municipal Property Improvements2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

Municipal Hall 3,000,000

RCMP Building (South End) 17,750

Total Municipal Property Improvements 3,203,350 208,000 212,160 216,403 220,731

General Revenue 203,350 208,000 212,160 216,403 220,731

Debenture Debt 3,000,000

Total Sources of Financing 3,203,350 208,000 212,160 216,403 220,731

Sources of Financing

Crofton Fire Hall 6,500

Chemainus Fire Hall 30,000

Building Maintenance 149,100 208,000 212,160 216,403 220,731

2012-2016 Information Services2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

PC Evergreen 37,000 54,790 54,790 54,790 54,790

Software Upgrade Ph2 40,000 60,000 40,000 40,000 40,000

Total Information Services 239,000 234,790 204,790 249,790 254,790

General Revenue 189,000 234,790 204,790 249,790 254,790

Appropriated Surplus 50,000

Sources of Financing

Server Upgrade 50,000 50,000 50,000 50,000 50,000

Website Implementation 50,000

Council Chambers A/V Equip 40,000

Backup Software & Equip 30,000 65,000

Sharepoint Server 50,000

Connectivity – Offices 10,000 20,000 30,000 40,000 50,000

Small Equipment 12,000

Other 60,000

2012-2016 Community Development2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

Visitor Information Centre 440,000

Somenos Marsh Rainwtr\Swr 150,000

Chemainus Festival Square Pl. 60,000

Chemainus Skate Park 350,000

Chemainus Community Ctr 60,000 1,500,000 500,000

Chemainus Dog Park 90,000

Chemainus Seawalk 250,000 350,000

Osborne Bay Sea Trail 800,000

Crofton Skate Park 200,000

Sherman Rd All Weather Field 1,500,000

Cowichan Commons Trail 220,000

Chemainus Revitalization 200,000 300,000

2012-2016 Community Development Cont.2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

Multi-Use Trails 100,000 150,000 200,000 250,000

University Village 125,000 500,000

Community Revitalization 400,000

Total Community Development 2,280,000 2,440,000 925,000 2,600,000 1,550,000

Crofton Waterfront 400,000 400,000

Maple Bay Wharf Upgrade 300,000

2012-2016 Community Development Financing

2012 Budget

2013 Budget

2014 Budget

2015 Budget

2016 Budget

General Revenue 300,000 537,500 832,500 953,000 1,100,000

Grants 450,000 700,000 575,000 200,000

Parks DCC’s 20,000 30,000 40,000 50,000

Sale of Land Reserve 1,205,000 1,182,500 62,500 1,032,000 200,000

Appropriated Surplus 325,000

Total Sources of Financing 2,280,000 2,440,000 925,000 2,600,000 1,550,000

Sources of Financing

2012 Community DevelopmentGeneral Revenue

Sale of Land

Reserve

Gov’t Grants

Appr.Surplus

Osborne Bay Sea Trail Network 100,000 400,000 300,000

Chemainus Revitalization 200,000

Visitor Information Centre 115,000 325,000

Chemainus Library 60,000

Chemainus Skate Park 350,000

Chemainus Community Centre 60,000

Cowichan Common Trails 220,000

Somenos Marsh Rainwtr\Swr\Trail 150,000

Total Community Development 300,000 1,205,000 450,000 325,000

2012-2016 Police & Other2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

RCMP Building (Duncan) 500,000 4,000,000 4,000,000

Total Police & Other 500,000 4,000,000 4,000,000

Debenture Debt 4,000,000 4,000,000

Appropriated Surplus 500,000

Sources of Financing

2012-2016 Fire Protection2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

Chemainus Fire Fighting Equip 10,000 10,000 10,000 10,000 10,000

Crofton Fire Fighting Equip - - - - -

Total Fire Protection 29,400 488,388 30,000 507,805 30,400

Fire Equipment Reserve 29,400 30,000 30,000 30,000 30,400

Fire Truck Reserve 458,388 477,805

Total Sources of Financing 29,400 488,388 30,000 507,805 30,400

Sources of Financing

Maple Bay Fire Fighting Equip 10,000 10,000 10,000 10,000 10,200

South End Fire Fighting Equip 9,400 10,000 10,000 10,000 10,200

Crofton Pumper 458,388

Maple Bay Pumper 477,805

2012-2016 Forestry2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

Forestry Vehicles - - - 36,000 36,000

Total Forestry - - - 36,000 36,000

Forestry Vehicle Replacement - - - 36,000 36,000

Sources of Financing

2012-2016 Transportation2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

Engineering Office Equipment 16,700 16,700 16,700 16,700 16,700

Mach & Equip P/W 599,245 397,000 380,336 407,253 388,303

Mach & Equip Garbage 674,791 260,000 260,000

Compost Containers 290,000

Roof Repairs/Renovation 50,900 175,000 175,000

Road Capital 2,775,000 2,830,000 2,888,000 2,945,000 3,004,000

Crosswalk Lighting 31,200 32,450 33,750 35,100

Rock Scaling 100,000 5,000

Drainage Capital 280,000 286,000 290,000 297,000 303,000

Flood Control 4,820,000 4,930,000 900,000 900,000 900,000

Chemainus River Bridge 5,018,000

Total Transportation 14,624,636 8,495,900 4,682,486 5,034,703 4,907,103

2012-2016 Transportation Financing

2012 Budget

2013 Budget

2014 Budget

2015 Budget

2016 Budget

General Revenue 2,184,600 2,127,900 2,178,150 2,416,450 2,307,800

Fuel Tax Revenue 791,000 791,000 791,000 791,000 791,000

Reserve – Equip Replace 599,245 397,000 380,336 407,253 388,303

Reserve – Garbage Trucks 674,791 260,000 260,000

Pollution Prevention 153,000

DCC – Roads 167,000 170,000 173,000 180,000 180,000

DCC – Drainage 200,000

Other Contributions 919,333 737,333 60,000 80,000 80,000

Short Term Debt 137,000

Debenture Debt 584,000 986,000 300,000 300,000 300,000

Grants 8,414,667 3,286,667 600,000 600,000 600,000

Total Sources of Financing 14,624,636 8,495,900 4,682,486 5,034,703 4,907,103

Sources of Financing

2012 Transportation

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Fuel

Tax

Res

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Gra

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Oth

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Engineering Office Equip 16,700

Mach & Equip P/W 599,245

Mach & Equip Garbage 674,791

Compost Containers 153,000 137,000

Roof Repairs 50,900

Roads Capital 1,737,000 791,000 167,000 80,000

Rock Scaling 100,000

Drainage Capital 280,000

Flood Control 3,396,667 839,333 584,000

Chemainus River Bridge 5,018,000

Total Financing 2,184,600 791,000 1,427,036 167,000 8,494,667 839,333 137,000 584,000

2012-2016 Recreation & Culture2012

Budget2013

Budget2014

Budget2015

Budget2016

Budget

Parks Capital 119,500 200,000 250,000 250,000 250,700

Fuller Lake Arena 25,000 130,000 180,000 180,000 180,000

Total Recreation & Culture 351,830 344,380 469,670 469,960 445,960

General Revenue 159,330 344,380 469,670 469,960 445,960

Sale of Land Reserve 112,125

Other Contribution (Duncan) 60,375

Appropriated Surplus 20,000

Total Financing 351,830 344,380 469,670 469,960 445,960

Sources of Financing

Chem Wharf Power Meter 20,000

Evans Park Fields 172,500

Cemetery 14,830 14,380 39,670 39,960 15,260

5 Year Tax Increases - Compared

2012 2013 2014 2015 2016

Gross tax increase 7.95% 5.17% 5.02% 4.99% 4.86%

Gross tax increase - new 5.81% 7.52% 4.80% 4.99% 4.86%

Net Tax Increase 6.45% 3.67% 3.52% 3.49% 3.36%

Net Tax Increase - new 4.31% 6.02% 3.52% 3.49% 3.36%

Capital increase 1.26% 1.81% 1.83% 1.60% 0.28%

Capital increase - new .80% 2.29% 1.83% 1.60% 0.28%

Net Operating TaxIncrease

5.19% 1.86% 1.69% 1.89% 3.09%

Net Operating TaxIncrease - new

3.51% 3.74% 1.47% 1.89% 3.09%

Next Steps (Proposed)

DATE ITEMFebruary 13th Proposed utility rates presented. Committee of the Whole finalizes Financial

Plan for open house

February 15th 2012-2016 Financial Plan open house

March 21st Utility rates (2012) bylaw will be introduced for first three readings

April 2nd Council workshop on distribution of tax rates

April 18th Financial Plan bylaw introduced for first three readings

April 23th Adjustments to tax rates

May 2nd First three readings of 2012 Tax Rates bylaw, adopt Financial Plan

May 4th Adopt Tax Rates Bylaw