Mayor's Report - April 12, 2011
Municipal budgets always embrace the inherent tension between demand for services and infrastructure, the willingness of tax payers to pay, and the overarching requirement that we live within our means. This year’s budget and five year financial plan has been prepared within tighter financial constraints than in previous years. These constraints are the focus of this mayor’s report.
Bowen Island Municipality is in a transition to a period of tighter finances. Over the past five years the municipality funded important infrastructure, capital, and planning projects from accumulated savings. In doing so, our community has acquired important assets - major road base improvements, expansion and environmental upgrade of our sewer plant, a new artificial turf field, upgrades to our municipal works yard, purchase of trucks for road works and snow plowing, purchase of fire trucks, construction of trails and beach accesses, and planning costs for the OCP, Community Centre, and Snug Cove.
The two largest of these infrastructure projects, the sewer plant and artificial turf field, leveraged $1.1 million municipal dollars to acquire assets worth $2.9 million dollars, through cost sharing with federal and provincial government grants.
This year, the municipality is proposing further strategic spending on road improvements, a new satellite fire hall, a new boat ramp at Tunstall Bay, replacement of a snow plow truck, and planning costs to complete the OCP and Snug Cove ferry marshalling work. We believe that, in spite of the draw these projects have on savings, these are necessary projects and it does not make sense to defer this work.
This project work has drawn down our healthy savings accounts that were built during the first five years as a municipality, 2000-2005, a time when our new municipality was staffing up and did not implement many projects.
However, the municipality is moving into a period where more project funding will have to come from our operations budget, as our savings are reduced. Our municipal enterprise has grown over the past ten years from a start-up to a full service operation. It is time to take stock, and review operations and services from top to bottom. We need to look for opportunities to constrain costs, and to increase revenues through improved cost recovery.
Over the last several years, the municipality has anticipated this transition. To build savings, in 2009 we created a new capital replacement and renewal reserve, funded by an annual 1.5% increase in taxes for 10 years. Also in 2009 Council initiated a core services review of municipal operations with our former CAO that continues with our current CAO Brent Mahood. Our 2010 strategic plan committed to cost recovery and cost constraint in the 2011 budget. In June 2010 Council committed to a maximum of 3% increase in tax revenue (after factoring in taxes from new development) and a maximum of 2% operating cost increase for the 2011 budget, as a way of setting limits of municipal growth.
The municipality has now completed a draft 2011 budget that meets these targets. This budget will be presented at the April 18th Council meeting, and the budget materials are available on the municipal website and municipal office counter. We welcome your comments.
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