The Town of Bonnyville gave residents a detailed breakdown of their finances at the 2018 budget open house.
Council and administration went through both the operating and the capital budget on Tuesday, Dec. 5 at town hall.
A tax increase of two per cent has been included in a balanced operating budget.
There's still work to be done on the capital budget, with a current deficit of just over $3.4-million. Council will have to make tough decisions in order to meet the obligation set by the province to balance the budget by May 2018.
The town put forward a balanced operating budget of $22-million.
Residential taxes will increase by two per cent, bringing the total revenue collected to slightly over $4-million. Commercial tax revenue will increase from about $2.7-million to $2.8-million. Industrial and farmland taxes will also be effected by the two per cent jump. In total, the town will take in over $7.8-million in tax revenue in 2018.
“In terms of tax dollar distribution, public works takes up just under $3-million, and we use just over $2-million for protective services. The Centennial Centre comes in third using $1-million,” explained assistant CAO Bill Rogers.
Nearly three quarters of the funds going to protective services will be allotted to the Bonnyville RCMP Detachment. Fire, ambulance, and 911 services will split the remaining money. At close to $1.5-million, the contribution to the RCMP represents nearly a quarter of the town's tax dollar distribution.
“Currently, the town spends just under $1.5-million on the RCMP. Out of the four services, the RCMP eats up a lot of the allotted $2-million. If you equate their contribution to the total tax revenue, it represents nearly a quarter of the funds,” said CAO Mark Power.
Administration also noted the town had lower than average tax rates, but spent more than the average municipality on protective services, transportation, and environmental services.
The MD of Bonnyville's $354,943 contribution to the Regional Community Development Agreement, which had previously been utilized in the capital budget, will be added to the operational budget. This brings operational expenditures and revenues on par with each other.
“The 2018 operational budget is a balanced budget. Should no new items arise, the interim budget will be presented at the next council meeting, and passed before Dec. 31. The interim budget will be able to be amended until the passage of the 2018 tax rate bylaw,” detailed Renee Stoyles, director of administration and finance.
Council will look to utilize a combination of cuts and borrowing to balance the 2018 capital budget.
In total, the town will take in over $9.7-million in revenue, which includes $2-million in provincial and federal grant funding, and slightly over $4-million due to the amendment of the ID 349 agreement structure.
Conversely, they're currently set to incur over $13-million in expenditures, leaving a $3.4-million deficit that must be balanced before the final budget is passed in May 2018.
“In the previous draft of the budget we eliminated the debenture of $7.2-million, and that was in large part due to the ID 349 funds we're getting. Obviously, that threw us into a huge deficit, but I think it was a good exercise in how to prioritize the capital expenditures,” detailed Power.
The largest expense the town will take on is their $5.76-million contribution to the regional waterline that is expected to break ground in 2018. The Public Works Infrastructure Replacement Program will take up $2.85-million. Council will use $2-million of those funds for construction along 47 Ave. and another $500,000 for work on 54 St. carried over from the project along 51 Ave.
Public works will also completing $2.5-million in streets and paving projects. The annual overlay patching program eats up $1.3-million of that, with $1-million going towards continuing work along 66 St.
Ongoing upgrades to the swimming pool have also been included in the capital budget, with $735,177 in work slated for completion. In addition to necessary repairs, the town intends to upgrade the overall look of the facility.
“We're planning on doing some of the aesthetics, as well as more of the must do and should do items from the study on the pool. We still have a significant amount of things that need to get done, but that will depend on the budget,” Rogers said.
A total of $442,500 will be allotted to repair and upgrade parks and sports fields throughout the town. This includes the $150,000 addition of washrooms and a warm-up shack at the town staging area, as well as $150,000 for new washrooms and upgrades to the parking lot at the Little Leap Splash Pad.
Administration laid out a number of options the town could utilize to balance the budget. Council could look to a possible debenture of $344,203 or they could decide to borrow the funds from future capital budgets. They also have the option to debenture the town's contribution to the regional waterline, but would need ministerial approval to do so. The remaining options are to make cuts to the current budget, or to combine any of the suggested alternatives.
After a long deliberation, council decided to cut between $1- and $
from the current capital expenditures. The remaining deficit will be erased through a short-term borrowing plan.
“This is the decision making council needs to do. We need to decide how much we want to trim the budget by. From there, we turn it over to administration, who then will take a look departmentally and come back with a plan,” said Bonnyville Mayor Gene Sobolewski.
Council is expected to discuss the interim budget during their regular meeting on Tuesday, Dec 12.
