Town looking at three-per-cent property tax hike in next year’s budget

Town of Osoyoos property owners are looking at a property tax hike of three per cent for 2018 as well as marginal increases in garbage, recycling, water and sewer rates.

On Thursday morning, Town of Osoyoos council began the arduous task of going through the 217-page budget document presented by to them by Jim Zakall, the town’s director of financial services.

The recommended three per cent tax hike is lower than last year’s 3.9 per cent hike, which, for the first time, included local taxpayers paying for 70 per cent of policing costs, instead of 30 per cent.

Under provincial law, communities that pass 5,000 in population – which happened with Osoyoos following the latest Canadian census in early 2017 – must pay 70 per cent of RCMP policing costs, instead of 30 per cent.

This year will mark the first time Osoyoos taxpayers are on the hook for the full costs of policing at the new higher rate for the full calendar year.

The final proposed RCMP budget for 2018 is $953,407, which is close to $600,000 more than it was when the Town’s population was under 5,000.

Council is still in negotiations with the provincial government relating to finalizing the cost sharing agreement to cover policing costs, said Zakall.

“The 2018 budget is being presented to council with a three per cent increase to property taxes,” said Zakall. “This is an increase of $72,695 in tax based revenue. New construction property taxation is estimated at $9,459.”

Debt payments for the new Osoyoos fire hall started in 2017 and the full annual debt payments to be paid out over the next 20 years begin in 2018, said Zakall.

“This is paid for by the Town of Osoyoos, Osoyoos Rural Fire Protection District and the Osoyoos Indian Band,” he said. “The Town’s portion of the total fire hall debt of $281,390 is $192,668.”

The fire hall debt will result in the owners of an average single family residence with an assessment of just over $350,000 paying $47.68 – or just under $4 per month – towards the fire hall debt.

Using the same single family residence assessed at $350,000, municipal taxes will increase from $578.62 to $599.12, an increase of $20.50 or less than $2 per month.

The same property owners will be paying $170.47 in policing costs, the same as last year, said Zakall.

On top of the proposed three per cent property tax hike, staff has recommended, as it has for the past several years, marginal increases in user fees.

Garbage and recycling fees are proposed to increase three per cent to $134 from $130.

Sewer rates are proposed to increase by $9.66 annually for a single-family residence. The annual cost will increase to $251.10 in the Town and $344.10 in Area A of the Regional District of Okanagan-Similkameen. This will create $53,100 in revenues needed to maintain the same level of funding available for capital projects, said Zakall.

Water rates are proposed to increase by $13.42 annually for a single-family residence to $348.96 in Town and four per cent to other water rates. This will provide $60,000 in additional revenues needed to increase funding available for capital projects.

The local water district rates are proposed to increase by $13.45 annually for a single-family residence to $408.97 and 3.4 per cent to other water district rates, including irrigation rates. This will provide an additional $18,500 in revenues for capital projects.

Wages and benefits for union employees with the Town of Osoyoos will increase by 1.85 per cent in 2018, resulting in an increase of $110,455 to the 2018 budget, said Zakalle.

Debt charges will increase by just over $200,000 to account for the fire hall construction project, said Zakall.

“In 2017, only fall interest was paid,” he said. “In 2018, both interest and principal payments will begin.”

There are three large capital projects that will require borrowing by the Town of Osoyoos if they are to be completed in 2018, said Zakall.

The first is to upgrade 62^nd Avenue between Hwy. 97 to 115 Street and 62^nd Avenue to Osoyoos Secondary School in the amount of $420,000.

The second is to upgrade Hummingbird Lane from Nighthawk Drive to Hwy. 97 in the amount of $266,480.

The other major project is the biggest one on the books for 2018 – a complete upgrade of the Town’s main lift station – in the amount of $1.72 million.

“All three projects would require elector approval for the borrowing and payments would begin in 2019,” said Zakall.

The first two projects would be repaid over 20 years through a provincial borrowing program that charges three per cent interest. The costs would see local taxpayers pay $11 per year in general debt annually for 20 years.

The annual debt repayment on the main lift station project is $115,611 annually.

“It is recommended that the funds available for capital projects in the sewer reserve fund be utilized for these debt payments and that no (tax) rate increase is required,” said Zakall.

General operating expenditures, less transfers to other levels of government, transfers to reserves, resort municipality funding, contingencies and capital/project expenditures, will increase from $577,477 to $6,464752 for 2018, an increase of 9.81 per cent.

Of this total, 4.05 per cent represents the increased costs for the RCMP and 2.34 per cent is the fire hall debt, said Zakall.

Sewer projects will increase by $12,820 to $1.238 million, an increase of 1.05 per cent.

Water operating expenditures will increase by $9,470 to $1.678 million for 2018, an increase of 0.57 per cent.

Staff has recommended continuing to support numerous reserve funds in 2018.

They include $11,5000 for the town marina; $14,530 for fire department equipment; $10,000 for Osoyoos Museum land restoration; $10,000 for waste/recycling initiatives; and $125,000 for a water meter reserve fund.

When you factor in municipal taxes, policing costs, general debt, fire protection, fire hall debt, garbage/recycling fees, sewer and water fees, the owner of a single-family residence in Osoyoos with an assessment of just over $350,000 will pay a total of $1,607.40 in taxes and user fees 2018, an increase of $77.49 from 2017.

This equates to an increase of $6.46 per month.

Local residents can view the entire Town of Osoyoos budget document on the Town’s website at www.osoyoos.ca.

Copies of the document are also available at Town Hall.

Council will continue budget deliberations over the next three months, with the final budget expected to be passed some time in early May.

KEITH LACEY

Osoyoos Times