The District of Lake Country is gearing up to make budget decisions.
Based on the numbers coming in from the 2011 fiscal year, the district is starting 2012 with a tough eye on the bottom line that is ever so slightly in the red.
“There is some disappointment in the 2011 numbers,” admits Stephen Banmen, CFO and deputy CAO for the district.
A presentation was made to council on Feb. 15 which laid out two types of budget shortfalls in 2011. Combined total revenue was down from predictions by $293,000. (The presentation’s power point slides can be found in the agendas section of the District ‘CivicWeb’ website.
The first 2011 shortfall is revenue fees for services such as engineering inspections and building permits.
Those fee shortfalls reflect the fact that 2011 was not busy for new lots or infrastructure in Lake Country.
Particularly disappointing was the projected budget in engineering which was off 95 per cent, with only $5,000 coming in of a predicted $100,000.
However, engineering fees historically swing wildly from year to year.
Much more on-target were the building permits, which were only slightly down from projections.
The fee shortfalls came after several very busy years. “Our community had the highest growth rate in B.C. at one point, a lot was built here,” remarked Coun.Penny Gambell.
Of more concern is the second type of revenue loss to district coffers—the permanent ones. The provincial grant to the district was down by $25,000 and is not expected to be restored this year. The return on investments was down slightly in the tough economic climate.
With those two factors in mind, there are careful decisions to be made by council in upcoming budget deliberations. “When starting 2012 we already have a bit of a challenge,” said Banmen, “and we are looking at either cuts in service levels or tax increases to make up the difference.”
Long term infrastructure planning is expected to make an impact on decisions, said Banmen, pointing to the water and transportation master plans.
The administrative side of the district has already taken steps to control costs. Banmen said no new job positions are expected to be created at the district in 2012 and three positions in the planning department were eliminated through attrition in 2011.
Banmen sees a hopeful note in the future as many of the cost pressures of incorporation are beginning to ease.
The budget presentation also predicted $150,000 in increased revenues due to growth in the region.
That should be a welcome relief to ratepayers who have had a 3.88 per cent average annual rate increase in the last five years.
Gambell is well aware of the pressures on residents in Lake Country who foot a large part of the district’s operating expenses because of Lake Country’s relatively small industrial tax base.
“In our discussion about what options are possible, I don’t want to see large increases,” she said. “There may need to be some service cuts as we go through the details of the budget. We’ve heard people do not support major increases.”
Options on the table include a mix of small tax increase with a water fee increase.
Gamble would love to see a zero per cent increase but some infrastructure improvements should go ahead because grants have already been applied for and cutting too hard will hurt the local economy.
“We do have to tuck in a bit,” Gambell said.
Budget deliberations are scheduled for March 1 and March 6.
