corporate budget overview - peel region · 2017 budget – $3.0 billion (operating $2.2b &...

CORPORATE BUDGET OVERVIEW Presented to Council November 24, 2016

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Title Agenda

• Overview of 2017 Budget • Operating Budget Tax Supported Programs Utility Rate Supported Programs

• Capital Plan • Summary of 2017 Budget • 2018 – 2020 Outlook

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2017 Bottom Line Impact

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Budget Reflects Peel’s Financial Principles

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$1.2 billion - Operating $666 million - Capital

Investing in a Community for Life

Living Affordable Housing

Early Years & Child Care Paramedic Services

Seniors’ Services Social Assistance &

Employment Public Health

Thriving Accessible Transportation

Waste Management Roads

Police Services Water & Wastewater

Conservation Authorities

Leading Information Technology

Information Management Financial Management

Asset Management Assurance & Risk

Capital & Property Workforce

2017 Budget – $3.0 Billion (Operating $2.2B & Capital $0.8B)

$878 million – Operating $99 million – Capital

$181 million – Operating $21 million – Capital

$1.2 billion – Operating $666 million – Capital

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Improving People’s Lives

Living • Assisting over 19,000 households with affordable housing or shelter space

• Improving patient outcomes through paramedic response

• Providing quality of life to 703 long term care residents

• Supporting families with low income through social assistance and child care subsidies

• Improving population health through immunization, children’s dental, prenatal supports and food safety

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Thriving

Integrated, Safe and Complete Communities

• Collecting and disposing of waste from over 425,000 households in an environmentally responsible manner

• Providing safe drinking water and treat waste water for 320,000 households

• Supporting the movement of people and goods via the Regional road network

• Connecting residents through 605,000 Accessible Transportation trips

• Keeping the community safe through effective and visible policing

• Protecting over 34,000 hectares of land through three conservation authorities

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Leading

A Future Oriented and Accountable Government

• Ensuring that the Region is financially sustainable to keep taxes affordable

• Leveraging technology to improve resident and client access to services (24/7)

• Creating effective partnerships • Being a model and progressive employer

and listening to the community

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Tax Supported

Operations 1.4%

Provincial Upload (0.7%) • Ontario Works Benefit $4.5 M • Employment $0.4 M • Court Security Costs $1.4 M

Reinvestment of the Tax Room Made Available by the Provincial Upload of the Costs of Ontario Works to Support Affordable Housing (Resolution 2016-601)

0.5%

Infrastructure Levy 1.0%

Net Tax Levy 2.2%

Property Tax Increase*

*Property Tax increase assumes 41% is Region’s Portion

0.9%

Operating Budget Overview

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Utility Rate Supported

Operations 1.5%

Infrastructure Levy 3.5%

Average Utility Rate Increase 5.0%

Peel Region 41%

Local Municipalities

39%

Education 20%

What the Average Property Tax Bill Funds

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Regional Services, $1,746M, 78%

*Conservation Authorities, $41M, 2%

*MPAC, $18M, 1%

*Police, $440M, 19%

*External Agencies Operating Budget total $500M MPAC: Municipal Property Assessment Corporation

Tax & Utility Rate Supported – $2.2 Billion

Proposed Operating Budget

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44% of Budget Funded from Property Taxes

Users Pay Where Appropriate

Property Tax, $998M, 44%

Grants and Subsidies,

$556M, 25%

Utility, $370M, 17%

Other, $321M, 14%

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Total Regionally Controlled Programs Budget $1.75B

Total Labour Costs @ 27% $480M

Program Services & Capital Reserve Contributions,

$1,266M, 73%

Labour Costs Tax Based,

$267M, 15%

Labour Costs Subsidy Based,

$149M, 8%

Labour Costs Rate Based,

$64M, 4%

Labour Costs – 27% of Budget

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Program Services &

Capital Reserve

Contributions, $1,266M ,

73%

Labour Costs, $480M,

27%

Non – Labour Costs – 73% of Budget

Grants and Subsidies Transfer

payments, $468M, 37%

Other Services

Contracted out, $132M,

10%

Capital Reserve

Contributions - Tax & Rate, $300M, 24%

Program Services,

$366M, 29%

Note: Regionally Controlled Programs only 14

Regionally Controlled Programs 2016 Revised 2017 Proposed

FTEs Additions FTEs

Tax Supported: Public Works 439 8 447 Health Services 1,907 40 1,947 Human Services 689 4 693 Enterprise Programs and Services (EPS) 742 14 756

TOTAL: 3,776 66 3,842

Utility Rate Supported 556 7 563

TOTAL Region (Tax + Utility) 4,332 73 4,405

Regionally Controlled Programs

People delivering services to People Addressing a growing and aging population

15 Note: Numbers may not add due to rounding.

Title

Tax Supported Programs

2017 Operating Budget

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Council’s Target

Proposed Net

Budget Net Expenditure 3.3% 3.4% Regionally Controlled 3.3% 3.4% Peel Regional Police 3.3% 3.2% OPP 2.1% 2.8% Credit Valley Conservation 3.3%* 3.7%* Halton Conservation 3.3% 4.1%

Toronto Region Conservation (1.9%)* (1.9%)* Assessment Growth (1.20%) (1.13%) Net Levy 2.1% 2.2% * Exclude One-time Costs such as Emerald Ash Borer costs

Respect for the Tax Payer

Net Tax Levy Increase in line with Inflation

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Net levy after assessment growth

Tax Supported Programs Net Increase/ (Decrease)

Regionally Controlled Programs 0.6%

External Agencies 1.0%

Subtotal 1.6%

In–Year Council Decisions* 0.6%

TOTAL Net Tax Levy 2.2%

Tax Supported – Net Levy Pressures

* Includes reinvestment of the tax room made available by Provincial upload of the costs of Ontario Works to support affordable housing, a new youth shelter in Brampton and subsidy for low income “MiWay” users.

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$ Millions

2016 Services to 2017 Population $1.8

Service Needs 11.9

Capital Infrastructure (1%) 9.7

Regionally Controlled

$23.4

External Agencies*

15.6

TOTAL INCREASE $39.0

*External Agencies include: • Peel Regional Police • Ontario Provincial Police – Caledon • Conservation Authorities • Municipal Property Assessment Corporation

Tax Supported – Budget Increases

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Living I have:

Affordable housing options Access to employment of my

choice Access to culturally appropriate

services Access to services that meet my

needs at all stages of life

$7.8 million

Thriving We live in a community that: Is environmentally friendly

Where growth is well managed Where built environment promotes healthy living

$2.9 million

Leading I trust that:

Region of Peel is a model & progressive employer

Coordination & partnerships occur

A systematic approach to innovation is in place

Peel is a well managed government

$1.2 million

Operating Budget (Tax) $11.9 M to Address Service Needs

Community for Life Investing In Peel

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Title Regionally Controlled Programs

2017 Budget Service Needs – $11.9M

Request (In $Millions)

Regionally Controlled Programs

Public Works (Tax)

Human Services

Health Services EPS Total

Living $6.1 $1.7 $0.1 $7.8

Thriving $2.9 - - - 2.9

Leading - 0.5 - 0.7 1.2

TOTAL Requests $2.9 $6.5 $1.7 $0.8 $11.9

Note: Numbers may not add due to rounding.

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External Agencies

2017 Budget Requests – $15.6M

Request (In $Millions)

External Agencies

PRP OPP CA’s MPAC Total External

2016 Services to 2017 Population $9.2 $0.27 $1.7 $0.1 $11.4

Living - - - - -

Thriving 4.2 0.03 - - 4.2

Leading - - - - -

TOTAL Requests $13.4 $0.3 $1.7 $0.1 $15.6

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Request

2016 Services to 2017 Population

$1.8

Service Needs 11.9

Capital Infrastructure (1%) 9.7

Regionally Controlled $23.4 External Agencies 15.6 TOTAL Requests $39.0

(In $Millions)

Gap of $21.8 M funded by a 0.9% Property Tax Increase

Respect for the Tax Payer

0.9% Property Tax Increase

Funding Sources

Ontario Works Upload $4.5

Employment Services Upload 0.4

Court Security (Police) 1.4

Sub-total $6.3 Assessment Growth 10.9 TOTAL Revenues $17.2

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$ Increase on $100,000 of Residential Assessment

Where Your 2017 Tax Dollars Will Be Spent

Based on $100,000 of Residential Assessment

24 A house with a value of $474,000 will see an increase of $41; 2017 Tax $1,892

Seniors’ Services

Early Years & Child Care

Title

Utility Rate Supported Programs

Operating Budget

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Increases (In $Millions) 2017 Net Cost

Inflation and Service Level Growth $6.6

Capital Infrastructure 11.0

TOTAL INCREASE $17.6

Utility Rate Supported Budget Increases

Total Pressures 5.0%

Average Utility Rate Increase 5.0%

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Average Utility Rate Impact Residential Small Business

Annual Consumption 290m3 695m3

Annual Increase $33 $85

Revised Annual Water Bill $622 $1,593

Users Pay Where Appropriate

Utility Rate Payer Impact

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Respect for the Utility Rate Payer

$973

$1,054 $1,020 $1,001

$1,059

$622

$1,079

$0

$200

$400

$600

$800

$1,000

$1,200

Halton* Durham* Markham* Toronto* Vaughan* Peel** Richmond Hill*

Peel’s Utility Rates are Competitive

$33

$589

*Based on 2016 Rates **Based on 2017 Proposed Rates 28

Title

Capital Plan

2017 Capital Budget

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Tax & Utility – $6.4 Billion

Ten Year Capital Plan

Regionally Controlled Utility Rate Supported,

$3,290M, 52%

Police Services, $280M, 4%

Regionally Controlled Tax

Supported, $2,791M, 44%

Capital Budget Funding: 59% Reserves 38% Development Charges 2% External 1% Debt

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Regionally Controlled 10 Year Capital Plan

10 Year Capital Plan ─ $6.1 Billion

Public Works- Tax Supported,

$1,867M , 31%

Public Works- Utility (Water,

Wastewater and Operation Support),

$3,290M , 54%

Human Services, $442M , 7%

Health Services, $262M , 4%

Enterprise Programs &

Services, $194M , 3%

Conservation Authorities Managed, $26M , 1%

Capital Budget Funding: 58% Reserves 39% Development Charges 1% Debt 2% External

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$6.1 Billion

State of Good Repair

$2.3B / 38%

DC Funded Growth $2.4B / 39%

Non DC Funded Growth & Council

Priorities $1.4B / 23%

Regionally Controlled Programs (Tax and Utility)

Capital Plan Classification

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Maintain Assets

SOGR 10 Year Capital Plan – $2.3B / 38%

Fern Forest Paramedic Station

Hanlan Feedermain

Peel Centre Drive

84% Very good or good

Poor, 5%

Fair, 11%

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1% ↑ in 2017 3.5% ↑ in 2017

Total Available Funding

(including interest)

$3.43B

Utility Supported 2017 – 2036

Non–DC Capital Plan

Portion to be Funded

from Utility Rate

$5.16B

Unfunded gap - requires 3.5% × 6

years

Tax Supported 2017 – 2026

Non–DC Capital Plan

Portion to be Funded from Tax

$1,819M

Total Available Funding

(including interest)

$1,631M

Tax Supported 1% Infrastructure Levy

Utility Rate Supported 3.5% Infrastructure Rate Increase

10-Year Outlook 20-Year Outlook

Ensure the Capital Plan is Sustainable

Unfunded gap 1% in 2018

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Title Non–DC Funded Growth & Council Priorities

Living

Health Services – $85 million

Human Services – $264 million

Thriving Public Works (Tax Supported)

– $640 million

Public Works (Utility) – $309 million

Leading Enterprise Program and Services – $83 million

10 Year Plan – $1.4B / 23%

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Title Growth Pays for Growth

Living

Health Services – $24 million

Human Services – $37 million

Thriving Public Works (Tax Supported)

– $814 million

Public Works (Utility) – $1,473 million

Leading Enterprise Programs and

Services – $3 million

10 Year DC Capital Plan – $2.4B / 39%

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Borrow Only for Substantial Assets at Affordable Rates

0%

5%

10%

15%

20%

25%

30%

2016 2017 2018 2019 2020 2021 2022

DC Debt Forecast Other Debt Forecast

Provincial Maximum Annual Repayment Limit

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Regionally Controlled Utility Rate Supported,

$499M, 64%

Police Services, $27M, 3%

Regionally Controlled Tax

Supported, $260M, 33%

2017

Capital Budget Funding: 52% Reserves 41% Development Charges 1% Debt 6% External

2017 Capital Budget

Tax & Utility Rate Supported $0.8 Billion

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Title 2017 Capital Budget Regionally Controlled

Living

People’s lives are improved in their time of need

$99 million

Thriving Communities are integrated,

safe and complete

$639 million

Leading Government is future-

oriented and accountable

$21 million

Community for Life Investing In Peel

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Summary of 2017 Budget

2017 Budget

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Tax Supported Programs 2017 Council’s Target

2017 Proposed Budget

Net Expenditure Increase: 3.3% 3.4% Regionally Controlled Programs 3.3% 3.4% External Agencies 3.3% 3.3% Assessment Growth (1.2%) (1.13%) Net Tax Levy 2.1% 2.2%

Utility Supported Programs Operations 0.4% 1.5% Capital Infrastructure 3.5% 3.5% Average Utility Rate Impact 3.9% 5.0%

Respect for the Taxpayer

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% 2012 2013 2014 2015 2016

Region of Peel 0.56 0.55 0.64 0.80 0.8

Average of three Area Municipalities 1.96 2.29 1.72 1.80 2.1

Education - - - - -

Average Property Tax Impact 2.52 2.84 2.36 2.60 2.9

Note: assumes weighted average with Peel at 42%, Area Municipalities at 37% and Education at 21%

Work with Local Municipalities

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Scenario 1 Scenario 2 Scenario 3 Scenario 4

Region (at 2.2% net levy increase)

0.9 %

(2.2%x41%)

0.9 %

(2.2%x41%)

0.9 % (2.2%x41%)

0.9 %

(2.2%x41%)

Local Municipality (at 3.0%,4.0%,5.0% or 6.0% net levy increase)

1.2% ( x39%)

1.6% ( x39%)

2.0% ( x39%)

2.4% ( x39%)

Education (at 0%) 0.0% (0%x 20%)

0.0% (0%x20%)

0.0% (0%x20%)

0.0% (0%x20%)

TOTAL Property Tax Impact 2.1% 2.5% 2.9% 3.3%

3.0%

Example For Illustrative Purposes Only

Average Residential Property Tax Impact

6.0% 5.0% 4.0%

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Additional Budget Request

2017 Proposed Net Tax Levy Increase 2.2%

Add: Additional 50 students in Summer Job Challenge Program (Total expenditures $460K, net $230K)

0.024%

Subtotal - Net Tax Levy Increase 2.3%

Property Tax Impact 0.9%

Tax Impact of Increase in Summer Job Challenge Program

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2018 ─ 2020 Outlook

Respect for the Taxpayer

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Tax Supported Programs 2018 2019 2020

Regionally Controlled Programs 2.2% 2.2% 2.0% External Agencies* 1.7% 1.6% 1.7% Net Tax Levy Increase 3.9% 3.8% 3.7% Assessment Growth 1.1% 1.1% 1.1% Net Tax Levy Impact 2.8% 2.7% 2.6%

Utility Supported Programs 2018 2019 2020 Operations 2.0% 2.0% 2.0% Capital Infrastructure 3.5% 3.5% 3.5% Average Utility Rate Impact 5.5% 5.5% 5.5%

2018 to 2020 Outlook

* Conservation Authorities - excludes one time costs related to Emerald Ash Borer

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* Excludes one time costs related to Emerald Ash Borer

2018 Budget Target – 2.6%

Tax Supported Programs 2018 Forecast

Proposed 2018 Target *

Net Expenditure 3.4% 3.2% Regionally Controlled Programs 3.2% 3.2%

Peel Regional Police 3.4% 3.2%

OPP 2.7% 2.7%

Credit Valley Conservation* 5.5% 3.2%

Halton Conservation 7.1% 3.2%

Toronto Region Conservation* 11.9% 3.2%

Assessment Growth (1.1%) (1.1%)

Net Levy 2.3% 2.1% Reinvestment of the tax room available from the provincial upload of Ontario Works costs to support affordable housing (Resolution 2016-601)

0.5% 0.5%

Combined Net Levy 2.8% 2.6%

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• Conservation Authorities

• Future Budget Meetings: o Thursday Dec 1st – Peel Regional Police, Ontario

Provincial Police and Departmental Presentations o Thursday Dec 8th – As required o Thursday Dec 15th – As required

Next Steps

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Investing In a Community for Life

Living

People’s lives are improved in their time of need

Thriving Communities are integrated,

safe and complete

Leading Government is future–

oriented and accountable

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