A three per cent municipal tax increase is what is being proposed to District of West Kelowna council.
Council got its first look at the draft budget on Tuesday.
Despite the Westside Governance Study’s prediction of five per cent tax increases each successive year until 2013, the DWK has had less than a three per cent increase each year since 2009.
According to a report that was presented to council, the three per cent increase will generate an additional $669,013 of revenue. Revenue from growth adds $276,525 for a total additional revenue of $945,538.
DWK chief administrative officer Jason Johnson told council that it is proposed that 47 per cent of those additional funds go to an increase in service levels, while 42 per cent go towards an increase in reserves and 11 per cent go towards an increase in 2012 operating expenses.
In a report given to council on Tuesday, it stated that a total of $454,416 has also been identified—through growth and operating cost savings and from a library reserve transfer—as discretionary funds.
The report suggests that $256,871 of this be used to satisfy increased service level requests and the remaining $197,545 be available for council’s discretionary use.
If all of those funds were to be committed to tax reduction, the revised tax increase would amount to 2.11 per cent.
According to Johnson, the DWK budget has been, and continues to be, conservatively driven.
“The revenue projections in the budget are based on realistic projections, so it’s a conservative approach,” said Johnson.
“When the budget was initially created, staff was given the mandate (of) increases being limited to no more than 1.5 per cent.”
Notable changes in the 2012 budget include a growth rate adjustment from 2 per cent to 1.24 per cent, conservative interest revenue added to reserves and the inclusion of an RCMP liaison officer.
The estimated cost, per year, for the RCMP school liaison officer is estimated to be $132,000.
The largest increases in the budget are for transit, RCMP and library services.
“Those services aren’t driven necessarily by the municipality, those are external agencies. Their costs do get reflected in our budget,” said Johnson.
Chief financial officer Jim Zaffino said that this budget includes a 10 year budget plan, which was not present in previous budgets. He said the completion of several master plans gave staff the ability to do the decade projection
“With the master plans being finished, there’s a more realistic (projection of) the costs, the time frame, the impact on reserves,” said Zaffino.
The only deficiency on the DWK 10-year projections came under the future expenditures category in 2015; however, since council authorized the transfer of 2008 to 2010 surpluses to reserves earlier in Tuesday’s council meeting, that negative number was replaced by a positive.
If council authorizes all the capital requests that are being submitted, it will be able to afford staff’s 10 year projections, said Zaffino.
“It’s just a matter of council agreeing on the time frames and what priorities are.”
DWK council will begin a detailed budget deliberation session on Jan. firstname.lastname@example.org