5-year Financial Plan (2024-2028)
Final Bylaw Adopted May 14, 2024
City of Merritt 2024-2028 Financial Plan Bylaw No. 2367
The Financial Plan Process
Council is required to adopt an updated Five-Year Financial Plan Bylaw and set the annual tax rate by mid-May of every year. The process is lengthy and involves Council, City Administration and the public.
The typically work flow begins in early fall, as City departments review and prepare their annual budgets. The City manager and the financial team plan and review the budget submissions mid-fall. Near the end of fall, Council reviews and discusses a provisional or draft budget at meetings that are open to the public in person and through video conferencing. The draft budget is posted online and is open to public review throughout early winter. Council reviews and discusses any feedback at subsequent public meetings. By mid-winter to early spring, the public has an opportunity for public engagement. Once Utility Rates Bylaw and other rates are approved, Council adopts a Five-Year Financial Plan by mid-May and the final tax rate is set.
Budget Overview
A thorough review of the City’s aging assets, budget deficits, increasing inflation, and a projection of the long-term viability of the community, is driving the budgeting process for 2024. Witnessing the challenges of neighbouring Okanagan communities, where Osoyoos is facing a nearly 24% tax increase, the City of Merritt is reminded of how we need to take steps now to avoid significant budget shortfalls, while maintaining the viability of our community.
The City’s aging infrastructure is already failing, evidenced by continued watermain leaks. A large portion of our road system will need to be replaced in the years to come. Likewise, the City’s Wastewater Treatment Plant is approaching the end of its lifespan. In addition, investment in the Kengard Well will enable us to access plentiful water sources and keep our community safe and viable for years to come. Strategies must be put in place now to preserve our future. As such, the proposed financial plan looks beyond present expenses to costs as far as five to 10 years from now.
The City of Merritt must take a very hard look at the services it provides and make some very difficult decisions. Already, City Hall has reduced wages significantly by pairing down its senior management team by 25% and identifying operational savings such as limiting software licenses. While the City is continuing, and will continue, to eke out operational savings, the reality is that the costs of doing business are going up beyond our control. While the rate of inflation has descended from its peak of 8.13% in June 2022, virtually every operation in Canada has been impacted by the compounded increase in cost. The RCMP cost to the City in 2024 has increased 10% and BC Transit has increased 12%. Communities are not immune, with cities like Toronto facing a 10.5% increase in tax rates.
The long-term plan is to preserve our community and help it grow in a sustainable manner. At present, the City’s budget has not been sustainable. Our costs exceed our revenue. Future costs of aging infrastructure will exacerbate this differential even greater. An updated parcel tax has been allocated to flow directly into restricted reserves to be used for things like water treatment for the Kengard well and an upgrade or replacement of the Wastewater Treatment Plant. This will enable the City to take advantage of provincial funding grants that require a co-pay City contribution. To balance the budget for 2024-2025, and not continue to operate in a deficit, the municipal government needs to set its revenue target at a 12.5% increase over 2023 levels.
These adjustments will enable the City to balance its budgets (which is required by law), build reserves for future infrastructure needs, and ensure the long-term sustainability of the community.
A major tool in setting the municipal property tax rate is BC Assessments. While the assessments are currently flatlining, the 2023 rate was 14%. Note that property owners have an opportunity to appeal their BC assessment; visit bcassessment.ca.
The City of Merritt must set the new tax rate for 2024 by mid-May. While the City has not yet set their tax rate, it is helpful to note that the overall cost in real dollars is not significantly different than neighbouring communities. For instance, the property tax for an average home in Kelowna was just under $4,000 in 2022.
Relevant Financial Information
2024 Budget Changes
- Final approved City of Merritt 2024-2028 Financial Plan Bylaw No. 2367
- Draft Budget presented December 11, 12 & 13, 2023
- Draft 2024-2028 Financial Plan Bylaw (March 12, 2024)
- Service Levels and Capital Program for the 2024 – 2028 Financial Plan presented January 29, 2024
- Long-term Risk Strategy to build reserves for water and sewer infrastructure using the general parcel tax adopted December 13, 2023
- Water tax Bylaw adopted February 27, 2024
- Sewer Parcel Tax Bylaw adopted February 27, 2024
- Fees & Charges Bylaw Amendment adopted February 13, 2024
2023 Plan
- Five-Year Financial Plan For The Period 2023-2027 (May 10, 2023)
- 2023 Financial Plan Bylaw amendment (December 13, 2023)
- 2023 Tax Rates (May 10, 2023)
2022 Annual Report
- 2022 Annual Report (created June 2023 | published October 2023)
WATCH THE BUDGET MEETINGS ONLINE
(PUBLIC INVITED)
OTHER RECENT MEETINGS
5-year Financial Plan (2024-2028) | Public Engagement
Open House | Monday, April 8, 2024 | 6:00 PM – 8:00 PM
Merritt Civic Centre
After several public Committee of the Whole (COW) meetings on a draft budget in December 2023, plus subsequent public meetings on related financials, the City of Merritt is ready to submit its final recommended 2024-2028 Financial Plan, to be presented and adopted on Tuesday, April 9, 2024.
City Council is now accepting comments from the public until Monday, April 8, 2024 at 8:00 pm. City staff and council will be available at an Open House on Monday, April 8, 2024, from 6:00 pm to 8:00 pm at the Merritt Civic Centre to provide details on the current financial plan and hear comments from the public.
The City encourages all concerned citizens to thoroughly review the proposed budget and complete the FORM BELOW with your comments and concerns.
Public Engagement
Submission Form
SUBMIT INQUIRIES TO
Director of Finance
250.378.4224, x900
kevin.natkinniemi@merritt.ca
finance@merritt.ca
Open House
CHALLENGES WITH FUNDING
Federation of Canadian Municipalities Lobbies for Infrastructure Funding
READ ARTICLE | STALLED PROGRESS
Stalled progress: Canada needs urgent infrastructure investment to build better lives amid record growth
As Canada experiences record population growth, an intensifying housing and homelessness crisis and a soaring cost of living, the need for sustainable solutions is increasingly urgent.
Life is harder than it should be in Canada. Cities and communities that support our quality of life with the services and infrastructure they provide are facing a debilitating infrastructure funding gap precisely when our residents need support the most.
The conclusion of the 10-year Investing in Canada Infrastructure Program and the lack of follow-on programs has left communities vulnerable. There is no sign of a new infrastructure plan, let alone one that enables the growth and corresponding housing development that is being targeted nationally.
The delay of initiatives like the Permanent Public Transit Fund, set to start only in 2026, and the ongoing renegotiation and new added uncertainty of the Canada Community-Building Fund, which communities rely on to fund core infrastructure, directly affects Canadians. It stalls progress on efficient transit systems, well-maintained community spaces and access to affordable and accessible housing.
These widening gaps in programs for the services Canadians need are alarming, especially in the context of rapid growth and the essential infrastructure needed to support swift action in housing development.
Despite promises made at the FCM’s Annual Conference last June, where the Prime Minister committed to a new federal-provincial-territorial infrastructure plan by Fall 2023, Canadians are still waiting.
The absence of a comprehensive plan brings uncertainty to the lives of individuals, particularly those searching for affordable housing. We need a housing and homelessness plan now, but for it to be successful the focus must extend beyond new housing units to include the infrastructure required to service these units and encompass a renewed commitment to invest in complete neighborhoods with robust public services.
It’s not just about bricks and mortar, pavement, and water systems. Fundamentally, it’s about the daily experiences, struggles, and goals of individuals and families across the country, especially when it comes to securing a place to call home.
Efficient transportation, inclusive communities and well-maintained core infrastructure are integral components of a successful housing strategy.
Municipal budgets are strained, impacting services that Canadians rely on daily. Unlike federal and provincial revenue, municipal tax revenue does not automatically adjust for inflation or economic growth, putting pressure on services that contribute to the quality-of-life Canadians expect and deserve.
There are many examples that underscore the urgency of the situation. In Brampton, Ontario, additional planned housing growth up to 2031 will require a $3 billion investment in infrastructure above the City’s planned forecast.
Again, this isn’t just about numbers; it’s about the lives of individuals in Brampton and communities nationwide, the quality of life that our country promises, and how people deserve better.
Recent federal and provincial efforts to address housing affordability are commendable but will fall short without a parallel commitment to infrastructure investment.
A forthcoming federal Housing Action Plan must offer urgent additional measures, but without a corresponding infrastructure plan, the prospect of maintaining and increasing the quality of life for Canadians remains elusive.
In the face of these challenges, municipalities are urgently calling for immediate infrastructure funding, particularly in areas like water, wastewater, and adaptation to keep Canadians safe and meet urgent core infrastructure needs.
There must also be a clear commitment in the next Budget from the federal government to convene all orders of government to work together on a new, and sustainable Municipal Growth Framework.
Striking a framework agreement will establish a foundation for sustainable growth, infrastructure investment and housing affordability.
It should empower municipalities with predictable revenue sources that are linked with national population and economic growth; enabling local governments to contribute directly and tangibly to the improved well-being and daily lives of Canadians.
As Canada navigates its unprecedented growth, a comprehensive plan that centers on people and families and their experiences is not just essential. It is the key to a brighter and more prosperous future for all Canadians.