COMPLETED BUDGET
5-year Financial Plan (2025-2029)
Budget Overview
The goal for 2025 is to bring the City into a more stable operating position and begin to build reserves to help pay for future water and sewer infrastructure. The preliminary City of Merritt Financial Plan 2025 – 2029 continues along the path charted in 2024 to balance the operating budget by 2025. Key elements of this preliminary budget show that the City will be looking at a about an 11% tax increase on the municipal portion of property taxes for 2025 only, which applies to only about half (55% on average) of the property tax bill. The other portion of a property tax bill goes to other levels of government. (Reference the pie chart). Also note that tax increases are expected to stabilize starting 2026.
Please note that the overall Property Tax increase would NOT necessarily be 11%. The other governing bodies must set their rates before the final overall property tax increase can be set.
Also note that the proposed tax increase on the average household, with a property valued at $445,000, would effectively amount to about $22 monthly.
At present, key points in this preliminary budget are as follows:
1. Delivering on Balancing the Operational Budget by 2025
During the 2024 budgeting cycle, a path was charted to balance the operational budget within two years, by the end of 2025, while simultaneously beginning to save restricted reserves for water and sewer infrastructure. The proposed 2025 – 2029 financial plan delivers on the commitment of a balanced operational budget by 2025.
Starting in 2024, the general parcel tax was transferred directly into restricted reserves for both water and sewer. Near term implications across 2025 – 2026 include the drawing down of the federal gas tax fund (now called the Canada Community-Building Fund) to fund water infrastructure projects, such as the pipe bridge replacement and Kengard Well design and construction. Increasing sales of service revenue, particularly in the sewer fund, will be required.
2. 2025 Tax Increases: Municipal ↓ Transit ↑ from Prior Plan
In the prior financial plan, back-to-back 12% increases were premised through 2025 for the municipal tax levy. Through a combination of operational and service level changes, the proposed municipal tax increase for 2025 is just under 11%. It is important to note that this is not an increase to your entire property tax bill. The municipal portion of your property tax bill comprises about half of the amount; the remaining portion goes to other levels of government. To limit the 2025 municipal tax increase, the following level of service changes are included in the plan:
These level of service changes are partially offset by the inclusion of the annual mosquito program within the municipal tax levy, adding +1 FTE in Public Works in 2027, and including budget for encampments and other community cleanup costs.
The transit levy increase will not follow the general municipal increase during the financial plan, reflecting the higher cost of maintaining existing service levels. A Committee of the Whole meeting was held on January 7, 2025, during which BC Transit presented Council with options on fare increases. While the percentage increase may seem large, the actual fare increase is only $1. Fare options will see the cost recovery percentage maintained at current levels in the near term given the cost trajectory. Council may elect to focus on advocacy with the Province. Staff suggests a decentralized Small Community Grant equivalent focused on transit funding for municipalities with populations under 19,000.
3. Significant Investment in Community
The City of Merritt will invest up to $48.7M in capital projects over the next five years across transportation services, water infrastructure, protective services, the East Merritt sewer infrastructure corridor, water meters, and community services facilities. A portion of this investment is contingent on grant funding.
4. Capital Funding Strategies and Future Debt Priorities
The capital investment is funded by planned and secured grants and grant contingency [48%], reserves [29%], and debt issues and equipment financing [23%].
The financial plan will draw down the Canada Community-Building Fund/Gas Tax Reserve through 2026 and begin building it back up starting in 2027. Unrestricted, water, equipment, and facility reserves will also be used to fund the capital investment in the financial plan.
Given the City’s current reserve position, equipment financing over five years will be accessed to fund all eligible equipment for Public Works and the Fire Department. Contributions to the sewer reserve starting in 2024 are reserved exclusively for the Waste Water Treatment Plant (WWTP). To fund the East Merritt corridor sewer infrastructure, debt issues will be required.
To pursue grant funding opportunities for the WWTP, matching funds through a combination of reserves and long-term debt will be required. The Municipal Liabilities Regulation sets the liability servicing limit at 25% of select municipal revenues. To that end, the WWTP, and required fire trucks, are the only priorities for future debt beyond the term of the financial plan.
5. Risks and Opportunities
The biggest risk in the financial plan is the funding of the Kengard well. Construction costs are premised to be funded by a combination of reserves and grant funds. If the grant application is not successful, a debt issue may be required.
The City’s current reserve position dictates the inclusion of projects and funding strategy within the financial plan. There are opportunities to improve future financial position and funding optionality. Three focus areas have been identified.
2025-2029 FINANCIAL PLAN
Ready to Be Adopted
The finalized budget has passed its third reading and is expected to be adopted at the next council meeting, Tuesday, April 8, 2025. This is the last opportunity for the public to provide input.
Frequently Asked Questions (FAQ)
How do we come up with the residential metered water price?
Water and sewer budgets are separate from the general operating budget. These budgets are meant to be self-funded through parcel tax (capital costs) and user fees (operational costs). Based on the current information on the cost of these services and without knowing the actual water consumption of the residents we are estimating the fees going forward. Once we have more data, through the universal water metering program, we will be able to refine those fees. Currently, based on our water production, it appears that Merritt residents are using 3-4 times the national per capita average. We do not have a valid reason for this extremely high-water usage. The implementation of water metres and the data we generate will help us to determine if all the water we are producing is being used by the residents or if there are losses in the system. Once we have this data, and address usage statistics through conservation and potential system loss repairs and upgrades, we may be able to find savings in both our water and sewer operations.
How did we come up with the $445,000 residential average single family dwelling home.
This is based on the BC Assessment Roll and is the average of that roll for the City of Merritt.
Is there a breakdown of the budget for general government? What does that consist of?
General Government budget includes wages for the Director of Corporate Services/Corporate Officer, Committee Clerk, Communications and Engagement, and IT staff. Other expenses include advertising and marketing costs, software costs for all departments, and municipal election costs.
Why are there no cuts to the Fire Department?
We are mandated to provide a level of service that ensures there is no negative impact on residents’ insurance rates. Insurers require that homeowners have a hydrant within a certain distance of the property and a fire department with specific apparatus accessible within a certain response time, or a property may be uninsurable or have a significant increase in cost of insurance. The Fire Department has been successful in finding efficiencies, namely in their staffing model – the Work Experience Program and its firefighters offset the cost of added career staffing, allowing the current level of service in light of the volunteer firefighter staffing crisis experienced. Call volume continues to rise year after year, with a 22% increase in 2024 over the previous year. Additionally, the Fire Department offsets much of its operational costs by entering into fire protection agreements for areas outside municipal boundaries.
What does unrestricted reserve mean?
Unrestricted reserve means those monies in savings that are not allocated to a specific capital project or service category but can be used to finance any capital project.
What happens to forecasted tax increases should housing assessment values plummet?
Given that we can not control assessment values this is a challenging question to answer. If the assessment values drop in the current year, then we generate less revenue. If there is a large or sustained decrease in assessment values, then residents will have to decide between increases in taxes to maintain current levels of services or reducing levels of service to minimize tax increases. Reducing levels of service often means reducing staff and that some things may not happen as often, such as garbage pick up or mowing parks and sports fields, or closing facilities such as the pool or the arena.
How will water meters work?
The City received a grant to purchase the water meters. We will install them at every residence and will monitor the water usage between the pumped system input and the end user consumption. This will enable the City to identify excess use versus system losses and initiate further conservation efforts or repairs and capital upgrades before we decide how to properly invoice for usage.
Can you explain how our wells work?
We have multiple wells, some working at maximum capacity and some working at only 2% capacity. With upper and lower aquifers, reservoirs, river dependency, we need the lower wells, in the deep aquifers to be running at a higher capacity, which is impacted by manganese levels in the aquifer. By designing and implementing a treatment system to reduce the manganese levels, we will have a greater water supply available to the community. It is important to acknowledge the ongoing draught conditions in the area and that water conservation is a global concern. We have a water licensing requirements set by the Province that we must adhere to. Many of our restrictions are related to the river dependency in the summer rather than our ability to draw water from our wells.
Why do we require a new or updated wastewater treatment plant if we just fixed it all after the flood?
Post-flood work was conducted to ensure the plant was operational, but it is well past its life expectancy. Several issues that were very prevalent as a result of the flood need to be corrected in the plant to ensure the impacts of such an event in the future can be mitigated. The current processes need to be modernized to ensure that there is no failure in the near to distant future. We have also reached the capacity of the system so any more significant growth in the community will need a larger system.
Why do we need another fire engine replacement?
Fire departments protecting mid-sized communities replace their apparatus every 20 years based on guidelines set by the Fire Underwriters Survey (FUS) in Canada. This organization assesses a community’s fire protection capabilities, including the reliability and effectiveness of firefighting equipment, such as fire engines and ladder trucks. As apparatus age, their performance declines, which can lower fire protection ratings and lead to higher insurance premiums for residents and businesses. The 20-year replacement guideline ensures fire departments maintain a dependable, efficient fleet, ultimately helping to keep insurance rates stable for the community.
Fire departments must also maintain a fleet with a minimum pumping capacity, such as 3,300 GPM for Merritt, to ensure an adequate water supply for firefighting operations. This requirement directly influences the type of fire apparatus purchased, ensuring the fleet meets both current and future demands. Pumping capacity requirements—and potential future increases—are shaped by community growth, building density, and hydrant coverage, allowing fire protection services to evolve alongside development.
Will the City of Merritt lose 24-hour policing? How will the loss of RCMP members affect response times?
Currently reducing the contracted number of RCMP members is no longer being recommended as an option, rather, budgeting different is the recommended option. Our contract is for 17 members, 10 of whom would be considered “general duty” constables. These are the constables that provide that frontline 24 hour policing service. At this time due to vacancies, our detachment has 16/17 positions staffed but we also have two members on extended leave. This puts us at about a 20% vacancy rate, which aligns with the RCMP’s provincial vacancy rate. If we budget for fewer members but keep our contract number of 17, then you should not see any change in level of service.
Why are there currently unfilled RCMP positions?
Provincially, the RCMP is running a vacancy rate of 20-25% of positions. This means there are no detachments that are fully staffed. Some of these vacancies are a result of insufficient recruitment. Some of the “vacant” positions actually have staff attached to them but they are on extended leaves, such as sick or parental.
How does the funding split between the City and Federal government compare to other municipalities?
In BC, municipal RCMP detachments in municipalities between 5,000 and 15,000 residents have a 70% municipality and 30% federal funding cost share.
Does Merritt have the highest property tax in the province?
No, there are 31 communities with higher tax rates as of 2024. It is important to note that when a Council elects not to raise taxes but maintain the level of service provided to residents, the funds must come from somewhere, and that typically means it comes from reserves. When we take money from reserves to fund operations, or do not put money into reserves, that means that we do not have funds available to properly repair, renew, or replace equipment and infrastructure, and it certainly leaves no funds available for new infrastructure. Typically, staff search for grants to offset the cost of infrastructure projects, but these grants usually require a 50% municipal co-pay. This means that if we have a $20 million-dollar project we have to have $10 million dollars of municipal funds available or we will not receive the funding.
Are we overstaffed? How do we compare to municipalities of similar size?
As a community grows the number of staff required at all levels of the organization increases. As a municipality we are also seeing increased scrutiny, more legislation, and more reporting requirements on our daily operations and our grant funding. We are being asked to do more with no change in funding from the higher levels of government.
As a part of the 2024 budget two senior leadership positions were removed and amalgamated into other departments. This allowed us to create more manager roles and save money. We are always looking for ways to be more efficient with our staff dollars, including using grant money to implement key positions that we don’t have operational funds to create.
As a complex organization we must also consider succession planning, recruitment and retention of employees. This means creating the right levels within the organization to allow people to see growth and stay with the organization for the long term.
It is extremely challenging to compare one municipality’s staffing level to another because it is dependent on the levels of service that the community expects. Lower levels of service may require fewer employees and higher levels of service will require more employees.
What are the salaries of Mayor and Council? Can we reduce the size of Council?
The number of Council members in a municipality may be established in letters patent or in a municipal bylaw. If neither apply, the number is established by legislation based on the population of a municipality; City’s or Districts with a population under 50,000 must have a mayor and six councillors. If we were a Town or Village we would be required to have a mayor and four councillors.
On December 15, 1964, the letters patent were amended to establish the Town of Merritt from the Village of Merritt; on May 14, 1980 the letters patent were amended again to establish the City of Merritt. Following the amendment of the letters patent in 1980 the City Council increased in size from one Mayor and 4 Councillors to one Mayor and six Councillors as per legislation.
If a Council wishes to change the number of Council members, it must pass a bylaw to establish the number of Council members; Council must receive the assent of the electors if it wishes to reduce the number of Council members. Council member remuneration is established by Bylaw 2266 which was adopted on August 27, 2019.
The annual rate for remuneration of the Mayor was established at $36,582 with an annual increase based on CPI; the base rate for Councillors is set at $17,394, with an annual increase based on CPI. A recent survey of similarly sized municipalities follows:
COUNCIL SALARIES | COMMUNITIES 5,000 – 10,000 (2023/2024) | ||||
MAYOR | FT/PT | COUNCIL | ||
Castlegar (9,084) | 36,000.00 | PT | Castlegar (9,084) | 18,000.00 |
Creston (6,002) | 42,633.46 | PT | Creston (6,002) | 19,185.00 |
Fernie (6,780) | 45,377.02 | PT | Fernie (6,780) | 22,688.64 |
Hope (7,159) | 35,856.00 | PT | Hope (7,159) | 20,318.00 |
Kitimat (8,864) | 50,060.00 | PT | Kitimat (8,864) | 27,777.00 |
Ladysmith (9,662) | 44,646.00 | PT | Ladysmith (9,662) | 16,819.00 |
Merritt (7,415) | 37,423.36 | PT | Merritt (7,415) | 17,794.14 |
Oliver (5,303) | 32,783.16 | PT | Oliver (5,303) | 17,814.25 |
Osoyoos (5,763) | 38,303.64 | PT | Osoyoos (5,763) | 21,722.04 |
Peachland (6,139) | 42,930.00 | PT | Peachland (6,139) | 19,629.00 |
Revelstoke (9,032) | 36,800.00 | PT | Revelstoke (9,032) | 24,936.00 |
Spallumcheen (5,798) | 33,012.00 | Spallumcheen (5,798) | 19,464.00 | |
Trail (8,286) | 34,525.00 | PT | Trail (8,286) | 18,525.00 |
AVERAGE | 38,951.64 | AVERAGE | 20,420.26 |
Budget Timeline
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 typical workflow begins in early fall, as City departments review and prepare their annual budgets. The City manager and the financial team review the budget submissions mid-fall and draft a provisional budget. Near the end of fall, Council reviews and discusses the 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 from about January to April. The public may engage with Council anytime during this period; however, the ideal time for contributions is when a Public Engagement session, such as an Open House, is announced. If you are unable to attend the Open House, residents are invited to attend public Council Meetings. If you wish to address Council regarding the budget at these public Council meetings, first confirm that the budget is on the upcoming agenda at merritt.ca/agendas. Then sign up to speak by completing the form on this page: merritt.ca/how-to-address-council.
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.

Financial Plan 2025 – 2029
Public Engagement
Budget Open House
At the City of Merritt Budget Open House on January 30, 2025, a series of graphics were presented to the public in a tradeshow-like format, combined with the opportunity to have a coffee chat with council. More information on the draft budget and a video on the budget process are also available on this page.
Council Meetings
The public is always invited to regular council meetings. If you wish to address council as part of “public input,” you may sign up to speak at the meeting. You may only speak on the topics that are on the agenda. If you wish to speak to council on a topic that is not on the agenda, you must register a week in advance appear as a delegation.
All public comment should be submitted before the end of February 2025. The final budget is expected to be adopted at the April 9, 2025, council meeting. The final budget must be approved before May 14, 2025.
Meet the Mayor or Councillor
City of Merritt Mayor and Council are open to meet with residents who wish to discuss any topic. Contact the Mayor or a City Councillor to voice your opinion. Or send an email to info@merritt.ca.
Online
Frequently asked questions were accumulated and are posted to this webpage. If you have additional questions, please submit an email to finance@merritt.ca.
In the Media
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- Merritt Herald: “City of Merritt seeking public feedback on tax increase options” (January 23, 2025)
- Merritt Herald: Proposed price-hike for pool lane rentals threatens to drown Merritt swim club” (January 29, 2025)
- Merritt Herald: “Merritt RCMP officer positions are at risk in city’s early budget plans” (January 22, 2025)
Note: that this was one of 25 options that council is considering. This was not intended to be a reduction in actual current staffing levels. Current staffing levels are at 14 members. One option under consideration was reducing the “budgeted” amount of 17 to somewhere between 14 and 17 members. - CFJC: “Merritt residents invited to Special Council Meeting on 2025 budget” (Dec 8, 2024)
- Merritt Herald: “City of Merritt discusses financial plan amid declining revenue” (Oct 31, 2024)