2016 Budget

Council adopted a Five-Year Financial Plan for 2016-2020.

It includes the creation of an asset levy to provide for the adequate maintenance and replacement of the District of West Vancouver’s capital assets (5.25 per cent), and funds the net increase in operating costs (1.62 per cent).

The levy supports an asset fund, representing a major step forward for the District in its budgeting and financial planning process by beginning to build a long-term financial plan which will address all aspects of capital planning, including creating and funding reserves for infrastructure maintenance and replacement cycles.

In many years, capital requirements were met by taking funds from operating budgets, and, as a result, many District facilities and much infrastructure are not being maintained properly.

A long-term approach combined with an appropriate mechanism for funding had not been considered by previous Councils. This new approach is intended to address the infrastructure maintenance and replacement gap that is forecast for the District of West Vancouver and many others across Canada.

Five Year Financial Plan 2016-2020

Video Clip: March 7 Council Discussion

Draft 2016 Budget

Presentation from Open Houses: Proposed 2016 Budget

Rich in assets

West Vancouver is quite rich in assets, with two relatively new recreation centres, unique assets like the seawall, many kilometres of roads, sidewalks, streetlights, and traffic lights, parks, playgrounds and sports fields, to name but a few.

This public infrastructure is worth over $1 billion and does not include utilities. Over the next 50 years, the majority of these will need to be replaced, and, over the life of these assets, they will require major capital investment if they are not to seriously deteriorate.

To support these public amenities, West Vancouver has relatively few properties, low density, and no industrial property tax base.

Maintaining our assets

The District needs to fund about $13.9 million in assets annually. Over the next 20 years, $300 million needs to be spent to maintain these assets (excluding utilities).

Proposed Solution: Three Steps

  1. Set up a system of asset reserves
  2. Set up a system of funding the reserves through an asset levy
  3. Provide graduated annual increases to the level of asset levy funding
Establishing an asset reserve

A key to managing municipal assets is the establishment of asset reserves, funded by a dedicated taxation stream called an asset levy. These reserves then provide the flexibility and accountability to invest in municipal assets in a thoughtful and considered manner.

The District of West Vancouver established three asset reserves:

  • Capital Facilities
  • Infrastructure
  • Equipment
Background: 2016 operational increase and asset levy

At a series of Open Houses in January 2016, a proposed increase to the operating budget of 2.09 per cent was presented to the public for feedback. In addition to that, exploring options on the best way to implement an asset levy were presented for consideration and feedback.

Proposed Asset Levy Options - January 2016

One-year levy – a single levy in 2016 is the best option. It would provide the required investment for 2016 and future years. This would allow West Vancouver to replace assets at the ‘optimum’ point, avoiding costly maintenance that does not prolong asset life, and providing the best value for money. The impact on the average taxpayer would be a single levy of $354 in 2016.

Four-year phased levy – a levy phased over four years would provide the minimum investment to meet 2016 critical needs. The levy would then be built up to the required level over the next three years. The impact on the average taxpayer would be a single levy of $255 in 2016, with smaller payments over the next three years until a total of $354 has been reached.

Seven-year phased levy – a levy phased over seven years would provide the minimum investment to meet 2016 critical needs. The levy would then be built up to the required level over the next six years. However, each year that required investment is not made, a deficit builds up of assets that are not being maintained at the optimal level and asset performance deteriorates. The impact on the average taxpayer would be an additional $152 in 2016, with smaller payments over the next six years until a total of $354 has been reached.

Ten-year phased levy  1per cent per year for ten years to build up to the required level. This option would meet funding requirements over time, but would not meet 2016 critical requirements. The critical point is where the risk of failure starts to climb. At this point, repairs are required just to keep the asset functioning, and, even then, may not be sufficient. The impact on the average taxpayer would be an additional $34 in 2016, with equal payments over the next nine years until a total of $354 has been reached.

Impact of 2016 increases on average taxpayer’s total municipal tax bill:

Open Houses

Three Open Houses about West Vancouver’s proposed 2016 budget and asset levy detailed above were held in January.

A presentation was made at the beginning of each open house, with a question period to follow. A copy of this presentation is available for download (below) in addition to notes from the question periods:

Presentation for Open Houses: Proposed 2016 Budget

Open House January 21, 2016 - Budget Q & A

Open House January 27, 2016 - Budget Q & A

Open House January 28, 2016 - Budget Q & A

Property assessments and taxes

Just because a property’s assessed value goes up, this does not mean that property will pay higher taxes. Assessments are used only to determine what share of the overall tax burden a property will pay, relative to the other properties in the same community. It's like a unit entitlement in a strata, except that it changes each year. In any given year, a property may pay a lower or higher share.

If the property goes up in value more than the average property, its share will go up. A property could go up in value, but go up less than the average increase, and that property’s share will actually decrease. In the District in 2016, almost every property has seen a significant increase in value, but some have increased more than others.

Those properties where the value increase has been greatest will see the greatest rise in taxes. 

Homeowner grants

Property assessments will also affect the Provincial Home Owner Grant program. Although the program is adjusted each year so that 90 per cent of the owner-occupied properties in the province qualify for it, this means that the top 10 per cent of properties by value do not qualify. Many of the top 10 per cent properties are in West Vancouver.

In 2016, 393 properties in the District that received some amount of Homeowner Grant will no longer qualify for any grant.

43 properties that received the full grant in 2015 will not receive any grant in 2016; 27 of these were getting the Regular Grant ($570), and 16 were receiving the Additional Grant ($845).

Resident owners aged 55 or older, and resident owners supporting children under 18, have the option to defer some or all of their taxes.

Video - asset management explained

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Financial Services

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