Staff Report: Financial Plan Insights 2025-2029

Committee of the Whole Report

TO: Committee of the Whole FROM: Scott Sommerville, CAO DATE: March 6, 2025 MEETING DATE: March 11, 2025

Financial Plan Insights 2025-2029

RECOMMENDATION:

THAT the report dated March 6, 2025 from the Chief Administrative Officer titled “Financial Plan Insights 2025-2029” be received for information.

PURPOSE:

The purpose of the report is to provide Council with a new way of looking at View Royal’s finances in advance of developing the Financial Plan Bylaw for 2025-2029 and the Property Tax Bylaw. It is staff’s hope that the information contained within this report will generate conversation amongst Council and takeaway questions for staff to answer prior to the introduction of the draft budget.

Our residents and business community are facing unprecedented uncertainty and challenges: the affordability crisis, housing crisis, homelessness crisis, climate crisis, health-care crisis, drug crisis, and a trade war/tariff crisis. Navigating through these tough times will require a wholesale review of the Town’s expenditures, and our new “buy-Canadian” policy may also result in new costing for projects.

TIME CRITICAL:

The Financial Plan Bylaw and Property Tax Bylaw must be given first three readings on or before May 12, 2025. Staff are anticipating these readings on May 6, 2025.

Final adoption of both bylaws must happen on or before May 14, 2025, and therefore a Special Council meeting is scheduled for May 13, 2025.

EXECUTIVE SUMMARY:

Rather than focusing on the variances from the previous year’s Financial Plan, this report hopes to provide a more wholistic view of the financial picture of View Royal.

Financial Plan Insights 2025-2029

What is the Financial Plan Bylaw?

The Financial Plan sets the five-year operational and capital budget for the Town of View Royal. The Financial Plan is a requirement of the Community Charter, and the Financial Plan Bylaw and Property Tax Bylaw must be adopted by May 15th of each year.

The Financial Plan summarizes money coming into the Town and how money is spent over a 5 Year period. The Financial Plan is a budget for the upcoming year, and the 4 years after.

The Town undergoes public consultation prior to adoption of the Financial Plan Bylaw. Comments and questions on the budget are welcomed year-round.

The Financial Plan includes:

• Proposed expenditures such as operating, capital, and debt repayment.
• Proposed funding sources such as taxes, fees, grants, and borrowing.
• Transfers to and from reserves and prior years’ surplus.

The Financial Plan also includes objectives and policies for the current year regarding the distribution of property taxes amongst the property tax classes, the distribution of funding sources, and the use of permissive tax exemptions.

The Operational Budget covers the expenses the Town of View Royal requires to provide ongoing services and programs to our 13,191 residents and our business community. Eg. Policing, fire/rescue, park maintenance, and utilities.

The Capital Budget is for expenses related to constructing, replacing, and acquiring capital assets for the future.

The Town cannot make expenditures that are not included in the Financial Plan. If an expenditure that is not authorized by the Financial Plan Bylaw is required, the Financial Plan Bylaw must be amended.

Legislation requires that the budget be balanced, and unlike other levels of government municipalities cannot budget for a deficit.

Maintain the same level of service and infrastructure approved by council.

What are Council’s Strategic Priorities that guide the Financial Plan?

1. Enhance Livability
2. Sustainable Development
3. Climate Action and Environmental Stewardship
4. Financial Sustainability and Service Excellence
5. Community Engagement and Good Governance
6. Health, Safety and Security

How Did View Royal’s Residential Taxes Compare to other CRD Municipalities in 2024?

Comparison of 2024 Taxes and User Fees on a Representative Home in CRD Municipalities*

Municipal Residential Taxes per Capita in 2023*

1. Oak Bay: $1564/capita
2. Saanich: $1028/capita
3. Victoria: $969/capita
4. Central Saanich: $896/capita
5. Sidney: $889/capita
6. Esquimalt: $884/capita
7. Colwood: $754/capita
8. Highlands: $754/capita
9. Langford: $737/capita
10. North Saanich: $715/capita
11. Metchosin: $676/capita
12. Sooke: $659/capita
13. View Royal: $656/capita

The Town of View Royal also collects on behalf of other entities. School District 61 Taxes (28%), BC Transit (7%), Capital Regional District (6%), Regional Hospital District (3%) BC Assessment Levies, and the Municipal Finance Authority.

*Statistics on Taxes and Charges on a Representative House from Local Government Infrastructure and Finance Branch of Ministry of Municipal Affairs Local Government Data Entry System

View Royal’s 2025 Property Assessment Values:

The figures provided are based on the January 2025 Completed Roll and are subject to change when the Revised Roll is received in April 2025.

There were 114 Building permits issued in 2023 for a total construction value of $166,014,407

Residential Assessments:

Residential (Class 1): $ 4,141,905,101

Residential assessments make up 91.2% of View Royal’s total assessments. The average assessment for a single-family home in View Royal is $1,095,000 in 2025, down 1.6% from $1,113,000 in 2024. The average assessment for a strata condo or townhouse in View Royal is $634,000 in 2025, down 3.9% from $659,000 in 2024.

Business Assessments:

Business/Other (Class 6): $ 374,502,800

The average assessed value for business class properties is up 6.1%.

How Did View Royal’s Business Taxes Compare to other CRD Municipalities in 2024?

Business/Other Tax Multiple

1. North Saanich: 6.56
2. Highlands: 4.94
3. Colwood: 4.87
4. Metchosin: 4.86
5. Saanich: 4.75
6. View Royal: 4.3
7. Sooke: 3.79
8. Victoria: 3.68
9. Oak Bay: 3.1
10. Langford: 2.73
11. Esquimalt: 2.63
12. Sidney: 2.42
13. Central Saanich: 2.17

Other Property Assessments:

• Recreational/Non-Profit (Class 8): $ 12,342,000
• Farm (Class 9): $ 7,428,171
• Light Industry (Class 5): $ 4,344,000
• Utilities (Class 2): $ 906,700

The multipliers for property classes are based upon assumptions of the consumption of Town services relative to residential properties.

User Fees:

Garbage Collection: (2024 Budget of $760,518)

Garbage user fees are based on raising sufficient revenue to cover the cost of providing the service.

Curbside garbage collection fees are increasing from $265 per dwelling unit in 2024 to $275 per dwelling unit in 2025.

Onsite garbage collection fees are increasing from $530 per dwelling unit in 2024 to $550 per dwelling unit in 2025.

Budget Impact: Curbside garbage collection will increase by $10 per dwelling unit, and onsite garbage collection will increase by $20 per dwelling unit.

Sanitary Sewer Collection: (2024 Budget of $941,796)

Sewer user fees are based on raising sufficient revenue to cover the cost of providing the service, and to fund reserve contributions for future sewer collection infrastructure replacement.

Sewer user fees are based on CRD winter water consumption data to equitably share the costs among all users of the sewer system. The average residential property uses 85 cubic metres of water each winter, and paid $379 for sewer fees.

Annualized winter consumption is for the billing period comprising six months ending in April of the billing year multiplied by two.

Government Grants and Transfers:

Casino Revenue Grant: (2024 Budget of $2,000,000)

As a Host Local Government, View Royal receives a 10% share of the net revenue from the Elements Casino through the BC Lottery Corporation (BCLC). 55% of the net revenue is shared with the City of Langford, the City of Colwood, and with other neighbouring local governments as they see fit.

Elements Casino Victoria was recently acquired from Great Canadian Entertainment by Petroglyph Development Group Ltd, a wholly owned corporation of the Snuneymuxw First Nation. Great Canadian is expected to provide transition services to Petroglyph Development Group for up to two years.

Budget Impact Consideration: View Royal’s share of casino revenue from the Elements Casino Victoria had been budgeted at $2M/year, but has been declining in recent years.

[Chart: Line graph titled "View Royal's Share of Casino Revenue" showing data from 2018 to 2024, with a significant dip in 2020]

Policy on Use of Casino Grant Funding:

The Town of View Royal will reduce its use of casino grant funding for delivery of ongoing operational services and focus the casino grant funding priority on acquisition, renewal, or replacement of municipal infrastructure.

Community Works Fund (formerly known as the Gas Tax): (2024 Budget of $538,584)

The Community Works Fund (CWF) is distributed to all BC local governments through the Union of BC Municipalities (UBCM) on a per capita basis.

The CWF Agreement with UBCM is in place between 2024-2034, providing predictable, long-term and stable funding for infrastructure or capacity-building projects. The conditions of the CWF are that the funds must be spent withing 5 years of receipt on eligible projects.

CWF Allocation Amounts for View Royal:

• $590,466 in 2025/26
• $590,466 in 2026/27
• $614,085 in 2027/28
• $614,085 in 2028/29

Applicable Eligible Investment Categories for CWF include:

Productivity and Economic Growth: Local Roads and Bridges, Active Transportation, Public Transit, Short-line Rail

Clean Environment: Solid Waste, Community Energy Systems

Strong Cities and Communities: Sport, Recreation, Cultural or Tourism Infrastructure, Fire Halls, Fire Trucks, Resilience to Natural Disaster

Capacity Building: Asset Management, Long-term Infrastructure Planning, Community Sustainability Planning

Small Communities Grant: (2024 Budget of $380,000)

The Small Communities Grant is an unconditional provincial grant to assist in providing basic services. The grant is for small municipalities (populations under 19,000) and is based on a formula of a base amount, assessment value, and population.

Traffic Fine Revenue Sharing: (2024 Budget of $70,000)

The Traffic Fine Revenue Sharing Grant transfers 100% of net revenues from traffic violations to municipalities responsible for paying for policing (population over 5,000). The distribution formula is based on View Royal’s policing costs relative to the total policing costs paid by all municipalities.

Growing Communities Fund:

The Growing Communities Fund is a provincial grant to address infrastructure and amenity needs to enable and serve population growth. View Royal received $4,665,000 in 2023 based on population growth between 2016 to 2021 added to a flat amount of $500,000. View Royal reports annually on how the Growing Communities Fund is being spent.

Local Government Climate Action Program (LGCAP):

LGCAP provides provincial funding to support the implementation of local climate action that reduces greenhouse gas (GHG) emissions and prepares for the impacts of a changing climate. Funding must be aligned with the Province’s CleanBC Roadmap to 2030 and Climate Preparedness and Adaptation Strategy.

3 years of LGCAP funding was allocated one lump sum payment of $337,198 in March 2024 and can be utilized until March 31, 2028.

Annual reporting on corporate GHG inventory.

Debt and Financing Costs:

View Royal is in an enviable debt position relative to many other BC municipalities, owing $4,146,384 in long-term debt issued by MFA as of Jan 1, 2024.

Debt Financing Cost $532,727 in 2023. Interest expense in 2023 of $217,112

• Issue 117: 3.25% Matures Oct 12, 2026. Original amount $2,445,000. From 2011, 15 year for Island Highway Firehall Lands.
• Issue 127: 3.30% Matures Apr 7, 2034. Original amount $5,490,000. From 2014, 20 year.

Liability Servicing Capacity available is $4,769,285 as of Dec 31, 2023.

Expenses:

West Shore Royal Canadian Mounted Police: (2024 Budget of $3,032,251)

Under the Police Act, the Town of View Royal provides policing through a contract called the Municipal Police Unit Agreement (MPUA). View Royal also pays for retro pay, signing bonus, overtime, guards and matrons under the Municipal Policing Agreement.

The Town of View Royal currently has an authorized strength of 14.35 RCMP officers. The authorized strength is based on a “Cops per Pop” formula of 1 officer per 900 residents, agreed to amongst West Shore municipalities. Due to staffing vacancies, the actual number of officers is typically 75% of the authorized strength.

It is anticipated that View Royal will authorize another officer in 2027, depending on BC Stats population estimates. As a municipality with a population between 5,000 and 15,000, the Town of View Royal pays 70% of the cost of policing, and the federal government pays the remaining 30%. Once View Royal’s population reaches 15,000 residents in the 2031 or 2036 census, we must pay 90% of the policing costs.

Municipal Employees to Support West Shore RCMP:

Under the RCMP Services Agreement, The Town of View Royal has an arrangement with the City of Langford to provide civilian support staff to the West Shore detachment. View Royal had been funding 1 ME for every 3.34 authorized officers. These municipal employees (MEs) are now provided to the RCMP at a ratio of 1 staff to every 2.7 RCMP officers. A new RCMP Municipal Employees Cost Sharing Agreement has been reached to more fairly distribute the human resources, payroll, administrative and management costs of these employees. Under the agreement, View Royal pays for a proportionate cost of the total expenses for the support staff, based on the number of RCMP officers authorized by View Royal.

West Shore RCMP Detachment Expansion:

As part of its duties under the Police Act, the Town of View Royal must provide “accommodation, equipment and supplies” for police operations and for detention of persons required to be held in custody. Langford, Colwood, and View Royal are all owners of the Westshore Detachment. The existing RCMP detachment consists of two connected facilities: 10,600ft² built in the 60s and 26,400ft² built in 1999.

Population growth on the West Shore has required increasing RCMP staffing, and a feasibility study has determined that the existing structure has 13,000ft² less than currently required for today’s staffing. The owners’ group are exploring adding another 53,000ft² to 63,000ft² to meet the detachment’s future needs in 2046, and to provide a building that meets today’s seismic requirements.

The validation phase of the project will end in August, when the engineers and architects will verify whether the project can proceed with an $87.5M budget. In the meantime, the three owner municipalities will work together to on a borrowing process for the detachment. A reserve to reduce the tax impact of the expansion should be strongly considered.

E-Comm 9-1-1 Dispatch Levy (New):

Starting on April 1st, 2025, the Town of View Royal is required to start paying E-Comm for 9-1-1 dispatch services. Historically, South Island RCMP had been dispatched through the Provincial Operational Communications Centre (OCC) at the West Shore detachment. The Province covered 70% of the cost of 911 and the federal government the remaining 30%. The Province selected E-Comm as the consolidated service provider in 2014.

Following this transition, the 10 South Island municipalities under RCMP jurisdiction were informed that the $4.9M cost of dispatch would be passed on to the municipalities.

The Province has not introduced a telecommunications levy as seen in other provinces to offset the cost of dispatch. Many other municipalities in BC will not see this increase to their 9-1-1 dispatch costs.

The first quarter of 2025 continues to be paid by the Province. The invoice for the final three quarters of 2025 is $276,600. In the 2024-2026 Financial Plan, the Town had budgeted $229,255.

Based on the current governance financial model, we can expect to see increases of 8%-12% in 2026, 5%-9% in 2027, and 5%-9% in 2028.

• 2026 – $398,304 to $413,056
• 2027 - $418,219 to $434,225
• 2028 - $439,130 to $464,941
• 2029 - $461,087 to $534,920

Budget Impact Consideration: The new charge of $276,600 for E-Comm 9-1-1 Dispatch in 2025 equates to approximately a 2.5% tax increase.

View Royal Fire Rescue: (2024 Budget of $3,037,292)

View Royal Fire Rescue (VRFR) has been proudly serving our community since 1948. The Fire Safety Act provides VRFR with legislative tools to improve compliance with the fire safety code.

View Royal Fire Rescue provides the community with fire prevention, fire suppression, fire inspections, fire investigation, Fire Smart, first responder medical aid, and emergency preparedness planning. The FireSmart program is funded through the UBCM FireSmart Community Funding and Supports grant.

View Royal Fire Rescue also provides services to Esquimalt Nation and Songhees Nation under a servicing agreement. Automatic and Mutual Aid is provided to Langford, Colwood, Esquimalt and Saanich.

The View Royal Fire Rescue Department consists of the Fire Chief, two Assistant Fire Chiefs, eight Career Firefighters, a FireSmart Coordinator, a Fire Department Clerk and 22 Paid On-Call Firefighters.

The first collective agreement between the Town of View Royal and the International Association of Fire Fighters (IAFF) Local 5419 came into effect on May 8th, 2024. The agreement expires on December 31, 2025.

In order to transition to a 24/7 paid staffing model, the Town of View Royal hired 3 career firefighters in 2024 and an Assistant Chief in February 2025. These staffing increases allow the department to provide a supervisor and a career driver at night, and to run a two-days two-nights shift pattern. It is anticipated that another career firefighter will be hired in 2026 to enable VRFR to run a multiple of different shift patterns, which is expected to be a focus in collective bargaining.

View Royal Bylaw Enforcement: (2024 Budget of $167,878)

The View Royal Bylaw Enforcement Department consists of one Bylaw Enforcement Officer and one part-time Bylaw Enforcement Services Clerk.

CRD Animal Control Bylaw Enforcement: (2024 Budget of $51,560)

Animal Control Bylaw enforcement is done through a contract with the Capital Regional District (CRD).

Transportation Services: (2024 Budget of $3,090,172)

The View Royal Engineering Department is responsible for 49 kilometers of paved roads throughout View Royal, except for Admirals Road, Six Mile Road, and TransCanada Highway 1 (provincially maintained).

Transportation services encompass roads, bridges, street lighting, traffic signals, sidewalks, line painting, signage, boulevards, bus shelters, traffic calming, snow and ice removal.

It also includes management of 42 kms of stormwater infrastructure, fleet maintenance, collection of lawn and garden waste, and geographic information systems (GIS).

View Royal Parks Services: (2024 Budget of $1,062,788)

The Town of View Royal Parks Department maintains over 70 park spaces, including sports fields, playgrounds, 49 kilometers of trails, off-leash dog areas, shoreline access, and manicured and natural green spaces.

Environmental Health Services: (2024 Budget of $2,664,404)

View Royal Engineering looks after 63 kilometers of sanitary sewer collections system, sewage lift stations, and grinder pumps.

Environmental Health also includes garbage and household food waste collection. The recycling and Blue Box program is run by the Capital Regional District.

The Capital Regional District (CRD) provides potable water and sewer system conveyance and treatment.

General Government Services (2024 Budget of $3,318,332)

General government services consist of corporate administration, finance, information technology, public relations, and maintenance of Town Hall and its grounds.

Office of the Mayor and Chief Administrative Officer (CAO): Public Relations, Human Resources, Strategic Planning, Annual Reporting, Information and Privacy Compliance, Municipal Insurance, Legal and Risk Management

Corporate Administration: Agenda Management, Archives and Records Management, Bylaw Establishment, Elections Administration, Communications, Webpage, Social Media, Community Engagement

Finance: Development of Financial Plan, Production of Audited Financial statements, Produce Tax and Utility Bills, Accounts Payable, Payroll

Information Technology (IT): The IT Department consists of one in-house IT Coordinator working with a Managed Service Provider (ESW). The Town plans to expand the IT Coordinator role from 0.6 FTE to 1.0 FTE in the current year, and become less dependent upon outside contractors.

Development Services: (2024 Budget of $942,136)

Development Services makes recommendations to Council on development applications, development permits, and development variances.

The department also deals with development bylaw amendments, subdivision approvals, urban planning and design, environment, heritage and revitalization. Building services is responsible for issuing, inspecting, and approving of all building and plumbing permits.

Economic Development: (2024 Budget of $30,604)

With a limited budget, the Town’s economic development activities include membership in the local Chamber of Commerce and hosting a Business Mixer once per year. From time to time, the Development Services department will initiate consultants reports on the economic picture of View Royal for Official Community Plan updates and similar projects.

West Shore Parks and Recreation Society: (2024 Budget of $768,644)

The Town of View Royal is a member of the West Shore Parks and Recreation Society (WSPRS), formed in 2001. WSPRS owns and operates the Juan de Fuca Recreation Centre, Centennial Centre, and the Q Centre Arena.

View Royal residents make up 14.1% of WSPRS clients and 17.2% of memberships.

Budget Impact Consideration: Council approved a WSPRS requisition increase of 2.88% on January 21st, 2025 to $790,789, a $22,145 or 0.20% tax impact.

Greater Victoria Public Library: (2024 Budget of $651,985)

The Greater Victoria Public Library was established in 1889 and serves 10 member municipalities with its 12 branches.

View Royal joined the regional service in 2002 and is part of the Central Shore Service Area, along with Victoria (Central Branch and James Bay Branch), Esquimalt and Oak Bay.

Budget Impact Consideration: Council approved a GVPL requisition a 4.30% increase on January 21st, 2025 to $671,890, a $19,905 or 0.18% tax impact.