* Written by Debra Lynn
The Village of Port Alice presented its financial plan for 2020-2024 online at portalice.ca in lieu of a town hall meeting that was cancelled due to the COVID-19 crisis.
In this plan, the village reduced their budgeted expenditures for 2020 by 24 per cent from 2019.
The village did not make big cuts in any one or two areas, but rather, “a bunch of little ones” says Bonnie Danyk, the village’s Chief Administrative Officer (CAO).
In addition, they are raising property taxes by 6 per cent. Utility rates will stay the same.
Over the last three years the Village of Port Alice has kept residential tax increases reasonable with cuts to budget expenditures and by subsidizing non-payment of taxes with surplus funds.
The village presently has 1.8 million dollars in surplus funds that also includes Community Forest money.
The Community Forest is a corporation owned by Port Alice, Port Hardy and Port McNeill that manages and profits from crown land resources.
At the end of 2018, the Village of Port Alice received 1.2 million dollars in revenue from the Community Forest.
The village believes that the 2021 tax assessment for the dormant Port Alice pulp mill will be greatly reduced. If the assessment is reduced to 0 and no changes are made, taxes will increase by 83 per cent. Possible changes to help offset this situation include a reduction in services, continued subsidization with surpluses or a combination of both. Although the village has been subsidizing the non-payment of taxes by the pulp mill from the budget surplus, it is considered likely a loan to the present or future owners of the property.
A lower tax assessment for the mill would mean more revenue would have to come from other sources for the village to be able to fulfill its obligations.
The village’s income resources come to a total of $2,132,900.00. Of that amount 41.36 per cent comes from taxation, 17.52 per cent from fees and other revenue, 29.49 per cent from government grants and 11.63 per cent appropriation from surplus and deferred revenue. The surplus is what is left over after a budgeted year, when revenues are higher than anticipated and/or expenses are lower. Until a reserve account is set up for the Community Forest, it is included in the general surplus. Deferred revenue is grant money that is received in advance of projects.
Distribution of property taxation is as follows: 41.51 per cent residential, 0.5 per cent utilities, 43.83 per cent major industrial, 3.56 per cent light industrial, 4.58 per cent business and 0.030 per cent recreation from a total of $860,700.00.
Expenditures amount to $1,746,900.00. From that amount 24.72 per cent goes to general government, 4.41 per cent to fire and protective services, 46.17 per cent for public works, 14.26 per cent for recreation, 3.12 per cent for water and 7.32 per cent for sewer.
The village has a debenture debt of $33,900 for the community centre. Financing of the debt is 1.5 per cent of the 2020 budget.
The 25-year loan from the Municipal Finance Authority, for renovations done in 2009-2011, will be paid off in 2036. The original building was built in 1970 from a combination of grants and donations.
Of the total capital expenditures of $239,500, $150,000 is allotted for the marina building and furnishings, $20,000 to replace street lights, $2,500 for a picnic table, $15,000 for community centre roof repair, $6000 for a treadmill, $15,000 for water well replacement, $15,000 for sewer system study and $16,000 for odour control. Most of the 2020 capital items will be funded from grants, gas tax, reserve funds or surplus.
Reserve funds include statutory reserves for parkland and capital as well as a fire truck reserve. Sewer plant ordour control, streetlights, treadmill and water well are to be funded specifically by the gas tax, which is a fund that delivers federal gas tax revenues to local governments.