While the Town of Comox is in a strong financial position with reserves, there are also significant pressures on its operating budget as council reviewed its 2021 core operating budget at the March 10 special council meeting.
This was the overall theme in the town’s chief administrative officer’s report to council as they began budget talks. Jordan Wall explained the Comox Valley Regional District’s requisition amount to the town is estimated at an increase of $185.60 per household per year over the next five years for services such as garbage collection with planned organics facility construction.
“The town will also see a $10 increase for water and a $10 increase for sewer. This will be partially offset with a decrease in the hospital tax of $80 starting in 2021,” he wrote.
The CVRD’s general requisition will increase 1.36 per cent in 2021.
On council’s radar for some time has been the population threshold within the town; once the population surpasses 15,000 people, the yearly RCMP cost coverage will increase from 70 per cent to 90 per cent, resulting in a total increase of $670,000.
The policing increases will not start until 2022, however, Wall explained due to RCMP Union negotiations and required retroactive pay once an agreement is reached, the town estimates an additional amount between $350,000 to $400,000 will be required in 2021.
Wall noted in the report regular inflationary increases, as well as the addition of two full-time positions within the town in late 2020, will result in a 2.4 per cent increase to the overall core budget which equals an increase of $25.16 per household if approved by council.
With CVRD, RCMP and town costs, the total increase required to balance revenues with expenses is $104.46 across general taxation and user fees, he said.
Additionally, Wall wrote as the town adopts and continues to build best practice asset management over the next few years, he anticipates current reserves will not be sufficient to cover the current depreciation of assets. Currently, statutory asset reserves are expected to decrease from about $14M in 2020 to $10M in 2025.
The current budget sees a $29,800,000 municipal spend, with $27,192,000 in total revenue (with a six per cent municipal tax increase) – resulting in a $2,608,000 withdrawal from reserves.
Budget discussions will continue throughout the spring during strategic planning meetings.