2026-2030 DRAFT FINANCIAL PLAN Staff Report
Staff report from the Director of Finance providing an overview of the draft five-year financial plan, including tax revenue increase drivers and opportunities for reduction.
TOWN OF VIEW ROYAL COMMITTEE OF THE WHOLE REPORT
TO: Committee of the Whole FROM: Steven Vella, Director of Finance DATE: March 25, 2026 MEETING DATE: April 14, 2026
2026-2030 DRAFT FINANCIAL PLAN
RECOMMENDATION:
THAT the Committee recommend to Council that staff prepare the 2026-2030 Financial Plan bylaw for consideration based on Attachment A of this report, incorporating feedback received during the public financial plan consultation, and outcomes from the April 14, 2026 Committee of the Whole financial plan recommendations.
ALTERNATIVE OPTION:
Option #2: THAT the Committee recommend to Council that staff prepare 2026-2030 Financial Plan bylaw for consideration based on Attachment A of this report as presented.
PURPOSE:
This report provides an overview of the 2026-2030 DRAFT Financial Plan (Plan), cost drivers, taxation impact to property owners, and identifies opportunities for reducing the tax increase.
BACKGROUND:
The Community Charter requires that local governments in British Columbia approve a Five-Year Financial Plan (in bylaw format) and Tax Rates Bylaw prior to May 15 of each year. To produce this bylaw, the Town updates its Five-Year Financial Plan which includes general and sewer operations, general and sewer capital programs, and reserves budgeting.
The annual budget process, public engagement, and review are used to balance the level of operational services, implement Council's strategic initiatives, and maintain Sustainable Infrastructure Replacement Plan (SIRP) financial strategies and long-term planning. In doing this the Town strives to,
- Ensure adequate funding for services
- Continue long-term financial strategies to increase future infrastructure replacement funding levels and reserves
- Manage expenses, contain costs, be efficient
- Assess staff capacity and delivery of workplans
- Provide for contingencies, manage risks and operate prudently,
- Maintain reserves for the future, and
- Use debt strategically
The Draft 2026-2030 Financial Plan published March 19, 2026 (Attachment B) as part of a public engagement program open to March 31, 2026 incorporated Council resolutions to March 10. Public engagement feedback and comments have been added for Council’s information and consideration.
This report provides information to assist Council in finalizing the 2026-2030 Plan by identifying the taxation impact to taxpayers, identify the cost drivers and potential opportunities to reduce the taxation increase.
DISCUSSION:
2026 Taxation Increase
The following 2026 Draft Financial Plan tax increase drivers were presented as part of the 2026 Draft Financial Plan and Project report to Council on March 3, 2026 forecasting a tax revenue increase of 8.69%.
| Driver | Amount ($) | Percentage (%) |
|---|---|---|
| SIRP Funding | $ 130,000 | 1.00% |
| Increase Communications FTE from .5 to .7 | 25,000 | 0.19% |
| New Parks Worker | 45,000 | 0.35% |
| New Fire Salaries | 519,900 | 4.01% |
| Reduced Permit Revenue | 251,800 | 1.94% |
| RCMP Contracted Services | 245,300 | 1.89% |
| 2025 Accumulated Surplus Funding | 175,000 | 1.35% |
| IAFF Collective Bargaining Support | 30,000 | 0.23% |
| E-COMM 911 | 110,200 | 0.85% |
| Small Communities Grant reduction | 45,000 | 0.35% |
| WSPR Transition to taxation | 65,000 | 0.50% |
| Other Cost Escalation | 159,400 | 1.23% |
| Reduced Boulevard Maintenance | (210,000) | (1.62%) |
| Increased Investment Income | (165,000) | (1.27%) |
| Non-Market Change | (300,000) | (2.31%) |
| Total | $ 1,126,600 | 8.69% |
Staff have incorporated further changes to the draft budget which are reflected in Attachment A:
| Staff Change | Amount ($) | Percentage (%) |
|---|---|---|
| Pro-rate Communications position | $ (9,000) | |
| Decrease Fire Grants to organizations | (21,500) | |
| Decrease BC Hydro PILT revenue | 24,500 | |
| Increased Fuel and Lubricant budgets | 22,300 | |
| Increased Non-Market Change | (84,941) | |
| Net Change | (68,641) | (.54%) |
The resulting revenue requirement is an increase of 8.15% or $193 per representative Class 1 property.
Options to reduce the 2026 tax increase
Council may reduce the tax increase by directing change to the drivers over which Council has discretion. Each item offers a different level of discretion for reduction or expansion. For instance, the Small Community Grant reduction is non-discretionary.
For Council’s consideration, staff have identified opportunities to reduce the tax increase, while maintaining levels of service.
| Item | Action | $ / % Impact |
|---|---|---|
| A) Councilor position vacancy | Pro-rate wages and benefits to reflect forecast in 2026 | ($16,000) / (.12%) |
| B) Staff position vacancy | Pro-rate wages and benefits to reflect forecast in 2026 | ($30,000) / (.23%) |
| C) E-Comm 911 funding | Utilize Police Operating reserve for 1 Quarter | ($96,550) / (.75%) |
| D) Re-direct 50% 2025 NMC to operations | Incorporate 50% of NMC currently previously directed to Capital Renewal, to operational funding (SIRP) | ($142,500) / (1.1%) |
| E) Defer restoring taxation to fund accumulated surplus used in 2025 | Repay accumulated surplus through taxation in a subsequent year | ($175,000) / (1.35%) |
With the exception of Item (D) above, all items will have the effect of deferring the tax increase to future years. This occurs because the taxable funding is being lowered in 2026, so comparatively, 2027 will see an increase if all items are tax-funded in 2027.
Item (D) relates to a recommendation in the Town’s Sustainable Infrastructure Replacement Plan (SIRP) where currently the whole $285,000 of prior year Non-Market Change is budgeted as a yearly contribution to reserves. Since this revenue is already part of the Town’s tax base, re-directing 50% of these funds toward operations could be considered a more sustainable option to reduce additional taxation.
The downside of this option would be the loss of investment revenue within the Capital Renewal reserve over time. Staff feel that given the suite of SIRP recommendations already incorporated in the existing Financial Plan, it is appropriate to consider balancing the opportunity cost of reduced capital renewal funding with the needs of taxpayers today. Table 1 and 2 illustrate the impact of including $142,500 in yearly contributions to Capital Renewal reserve over the next five years vs re-directing the funds toward operations. There is an opportunity cost of approximately $740K consisting of reduced contributions and accumulated interest.
| Table 1: Including $142,500 NMC | Amount ($) |
|---|---|
| Balance Jan 2026 | $ 3,051,716 |
| Interest earned | 656,600 |
| Contributions | 11,335,772 |
| Draws | (1,021,000) |
| Projected balance 2030 | $ 14,023,088 |
| Table 2: Not including $142,500 NMC | Amount ($) |
|---|---|
| Balance Jan 2026 | $ 3,051,716 |
| Interest earned | 627,500 |
| Contributions | 10,623,272 |
| Draws | (1,021,000) |
| Projected balance 2030 | $ 13,281,488 |
The 2026-2030 Financial Plan Bylaw will be adopted ahead of the 2026 Tax Rate Bylaw, prior to May 15, 2026.
PUBLIC PARTICIPATION GOAL:
The desired level of public participation for the recommended option is: ☒ Inform ☐ Consult ☐ Involve ☐ Collaborate ☐ Empower ☐ N/A
TIME CRITICAL:
Financial Plan and Tax Rate Bylaws required final reading prior to May 15, 2026
| CONCURRENCE: | Initials | Comments |
|---|---|---|
| Chief Administrative Officer | I concur with the recommendation. |
| REVIEWED BY: | Initials |
|---|---|
| Director of Finance | SV |
Attachment A: 2026-2030 Draft Financial Plan Updated with Staff Changes Attachment B: 2026-2030 Draft Financial Plan Published 03-19-2026 with Budget Survey Results
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