Every year, as required by Provincial legislation, the District adopts a Five Year Financial Plan Bylaw which serves as the district's budget. This includes Operating Budgets and Capital Project.
Each year the municipality is faced with the challenge of balancing the budget.
While a municipality can incur a debt to pay large capital projects it cannot borrow or mortgage to fund day to day operations the same way that other levels of government can. This is a key difference as it means that the municipality must rely on revenue sources to cover off all expenses for the year.
Careful review is used to balance the level of services expected by the community with ability to pay through reasonable taxation and user fees. In doing this the district moves towards its Strategic Planning Goals, which closely relate to the District's Integrated Community Sustainability Plan (ICSP).
The 2019 Financial Plan is available here.
Long Term Financial Plan
Long Term Financial Planning is the process of aligning financial capacity with the community vision and long-term service objectives. This is achieved through development of a set of financial principles and an effective linkage to the community vision (Official Community Plan), Sustainable Highlands Plan and Asset Management Plan. It is an essential tool for financial decision making. It provides information to guide decisions about the mix and timing and outlays on operating activities, renewal and replacement of existing assets, future additional assets and the associated funding implications. It can be used to assess the expected future impact of financial decisions and to manage risks.
The District of Highland's Long Term Financial Plan, which is part of the overall Asset Management Strategy, integrates with District operations, and aligns the District’s financial capacity with the community vision and long term service objectives. The Plan will form a basis for preparing the Five Year Financial Plan each year.
The municipality has a long-term financial framework focused on five areas:
Recognized value for services
Predictable infrastructure investment
Competitive property taxes
Responsible debt management
Improved reserves and reserve funds
Financial stability is fundamental to the health of the community. Only with stable and sufficient revenues, and careful planning of expenditures, will the District be able to provide the important services residents need and enjoy.
Annual Budget and Five-Year Financial Plan
Every year, we develop an annual budget outlining how tax dollars are invested to support our businesses and residents. We include a five-year balanced financial plan to guide our strategic investments and service plans while keeping property tax, utility fees, and user fees affordable over the long term.
To balance the budget, we carefully analyze the level of services required to meet the expectations of the community, and we balance those against realistic taxation and user fees levels.
Sustainable Infrastructure Replacement
A challenge facing our community is that many of our existing assets were constructed in the 1970s with significant funding support from senior levels of government. These assets will need replacing in the coming decades, and a renewal investment is required to maintain service to the community and protect the next generation. Council recently approved a long-term approach to gradually reach sustainable infrastructure replacement levels within fifteen years. We expect to use a gradual approach to increase the annual $4.2 million of capital investment to the minimum $6.2 million sustainable infrastructure replacement level.
To achieve this goal, we have the following in place:
Asset Levy: A separate Asset Levy was established in 2017 to clearly identify infrastructure funding for taxpayers.
General Capital Program: A fifteen-year plan to increase infrastructure spending equal to 1.25% property tax increase to average homeowner each year. ($25 dollars per year to average home)
Water System: A ten-year plan to increase infrastructure spending equal to 1.50% water utility rate increase to average homeowner each year. ($8 dollars per year)
Sewer System: A fifteen-year plan to increase infrastructure spending equal to 5% sewer utility rate increase to average homeowner each year. Some debt financing will be required to bridge the first few years as funding is gradually increased and we begin replacement of aging sewer mains and lift stations. ($13 dollars per year)