After many budget meetings, on March 9, council passed the 2011 to 2015 financial plan.
As we worked together it became clear that there were once again facing some tough decisions.
Every department would have to come to the table to help; with the exception of transit, for the most part we were able to make the adjustments necessary to deliver what we believe to be a fair budget.
Operational costs are not increasing from 2010 levels. Over the next two months we will work with BC Transit to get our bus service on a sound footing
What does it all mean? Where do we stand? Are we on the right path? Are we managing your money right? Are we maintaining our assets and managing our debt, while still being able to provide services? For me there are two key areas that I focus on.
Let’s take a look: The depreciated value of our assets is $135 million and it would cost us around $500 million today to replace these assets.
Over the last number of years we have focused on upgrading our infrastructure while at the same time developing solid long-term plans. I want to look at two examples
In 1995 the council of the day inherited a hydro electric system that needed major capital investment to ensure its long-term viability. By 2014 we will have completed all of our major infrastructure upgrades and the debt on the G5 generator will have been retired.
In 2004, we were facing a similar situation in water and sewer utilities as that past council was facing back in 1995 with Nelson Hydro. In 2004 the city spent $24,000 in water main upgrades as part of a total capital expenditure.
In 2006, council received the water master plan and the news wasn’t great. The plan identified that the city had an infrastructure deficit of $20 million in our distribution system alone. The master plan also identified other high priority projects including improving water treatment and developing a secondary source.
We are now in year seven of the plan and here is what we have accomplished so far: annual contributions to reserves have increased from $450,000 per year in 2004 to an estimated $1.7 million for 2011. The city invested $4.4 million since 2008 and the 2011 budget invests a further $2.5 million in the water utility.
The city is carrying just over $12 million in general debt; however the vast majority of this debt is being serviced by other entities including Selkirk College, Terasen and the regional district partnership on the complex. Of this $12 million in debt, the tax supported debt is less than $500,000 and is amongst the lowest in the province.
No one likes fee or tax increases; however, they are necessary if we want to be able to maintain our capital assets and manage our debt load.
Our priorities with this budget were driven by what our community members told us in a citizen survey delivered in March 2010. Although a difficult budget, I believe our planning and focus is on the right track.
Mayor John Dooley shares this space on Wednesdays with his city council colleagues.