Infrastructure deficit funding

I'm working on a recommendation to Council to pursue something along the lines of an ongoing annual 1% tax increase for 15 years, to provide adequate reserve funding to keep up with maintenance and replacement of core infrastructure and facilities. Maple Ridge and District of North Vancouver have had similar programs in place for a number of years.

I would love to hear from other municipalities that have a similar program in place or are contemplating one...I have already built a pretty strong case for this, but its always nice to be able to say "and look at all these other municipalities who are doing this as well!"

Any other thoughts or advice are welcome.

Thanks everyone, and happy holidays :smile:

Kris Boland, Director of Finance, District of Mission

Comments

  • Penticton has been doing exactly this since 2016 and will be doing so for the foreseeable future.

  • Why not budget annually for depreciation? That's what we do.

  • Campbell River has been doing this since 2016 as well - $90K each year (an approximate tax increase of 0.75% in 2016/17 and 0.63% for 2019).

    Alaina Maher
    City of Campbell River
    [email protected]

  • Allison: we do budget for amortization, but that doesn't necessarily mean the funding is going into reserves to maintain and replace TCA's. I hear you though, Bill Cox did a very compelling presentation a few years ago at the conference to show how "funding" your amortization figure would more or less solve your infrastructure deficit. Important distinction though, funding and budgeting don't mean the same thing in this case.

    Kris Boland, Director of Finance, District of Mission

  • We have been working on this, although it has been more deliberate as far as what is being funded. The Roads infrastructure deficit was funded over three years at 1.8% per year with 2019 being the last year for that. Although with the cost of construction increasing, they are behind again and our Infrastructure Director will be asking for another 2% a year for 2 more years.

    The intent was to fund the facilities, parks & rec deficit (mostly facility renewal) in 2020 and 2021 at 1.8% again.

    The Infrastructure Director will be asking Council to fund Roads though for another 2 years at 2% and then the facilities after that.

  • Quesnel introduced its Capital Reinvestment Plan Levy in 2009 for replacement of hard infrastructure - roads. sidewalk and storm (a separate levy on our tax notice). The increases to the levy have been a bit erratic but the last Council was very committed to increasing the amount and we averaged a 1.5% increase to the levy for the last three years. The levy is now 12.5% of the total taxes we collect. We also have been increasing our utility rates yearly to ensure adequate replacement funds for sewer and water.
    This year we will be taking a break from increasing the Levy due to other tax pressures (building a new public works facility) and we will also be doing an update to our 20 year capital plan which includes funding models to see where we are at with respect to our infrastructure deficit.
    We will also be looking this year at how we fund our building replacements as we have several aging major buildings.

  • For the muni’s that are doing this, is the infrastructure tax a separate line item/levy or is it all rolled into your total municipal tax rate? I would love more info on this.
  • We are looking at this for next year.

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