Initiating the 2026 Financial Planning Process

Initiating the 2026 Financial Planning Process

RECOMMENDATION:

THAT Council provide staff with a recommended percentage target for property taxes on a representative home for the 2026 budget preparations.

PURPOSE:

The purpose of this report is to seek early Council direction as staff initiate the 2026-2030 Financial Plan Bylaw, and to provide insight into anticipated changes to revenues and expenses.

TIME CRITICAL:

The 5-Year Financial Plan Bylaw must be adopted by May 15th, 2026.

EXECUTIVE SUMMARY:

The Town’s budget outlook for 2026 is currently a 9% tax revenue increase, including non-market changes to assessments yet to be determined.

FINANCIAL IMPLICATIONS:

On the revenue side of the budget process, Council should be aware of the following:

Non-Market Change in Assessments:

Non-Market Change (NMC) is a change in the value on the assessment roll that is not market related (typically new construction related). NMC is an important potential source of new tax revenue without having to increase View Royal’s property tax rates.

While the non-market release date is not until early January 2026, staff will work towards getting a better idea of the amount of new assessment in early November.

Declining Casino Revenue Grant

View Royal’s share of casino revenue from Elements Casino Victoria was reduced to $1.9M/year for 2025. Early returns indicate that revenue may only be $1.75M in 2025.

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.”

Declining Development Permit Revenue

Development permit fees in 2025 are well below previous years, and the budget for permit revenues should be adjusted downward for 2026. Current revenue up to October 31st is $127,223 as compared to a 2025 budget of $608,000.

On the expense side of the budget process, Council should be aware of the following:

Election-Related Expenses

The General Local Election on October 17th, 2026

A budget for the 2026 General Local elections will be established, along with orientation and strategic planning, photography, and new IT devices for elected officials.

Competitive Process for Major Vendors

Following a service review of goods and services provided by major vendors, a competitive process for the following contracts is required in 2026:

• Waste Management Contract
• Managed Service Provider for IT services
• Boulevard Maintenance Contract

Full-Year E-Comm Levy

The E-Comm contract for $276,600 began in the second quarter of 2025. The 2026 levy is expected to be between $401,992 to $424,120 (an increase of $125,392 to $147,520 from the 2025 levy). The current 5-year financial plan has $405,680 budgeted for E-Comm in 2026, which is included in the current financial plan.

West Shore Detachment CRD Sub-Regional Service

While the timing and exact amount of the Capital Regional District sub-regional service is yet to be determined, Council should be aware that the CRD requisition for View Royal’s share of the detachment expansion will arrive in the coming years.

Collective Agreement with IAFF Local 5419

The first Collective Agreement between International Association of Fire Fighters (IAFF) Local 5419 and the Town of View Royal expires on December 31st, 2025. At the time of writing this report, it is unknown when collective bargaining will commence.

CONCLUSION: