Kneehill County has delivered a balanced budget, despite a tough economic climate that has cut into its revenues.
Kneehill County Council announced the completion of the 2017 Operating and Capital Budgets during deliberations at a Special Council Meeting held on November 9, 2016.
The 2017 budget process was challenging as there has been a decrease in assessments, with non-residential assessments being hit the hardest particularly on the linear side. The 2017 budget encapsulates a 14.5 per cent decrease in oil/gas well tax assessments and a 9.5 percent decrease in pipeline assessments. As the linear portion of tax revenues continue to decrease, and is projected to decrease into the 2018 budget cycle by approximately the same amount, it foresees financial and budget challenges for the future.
The 2017 budget was completed with the goal to provide ratepayers with the same service standard on all core services that residents have indicated as priorities. Road construction, road maintenance, solid waste services, and water have remained virtually untouched in the 2017 budget. Through streamlining its organization and removing items deemed to be currently unnecessary, council was able to provide a balanced budget that requires no borrowing and minimal usage of the County’s reserve accounts.
In general terms, the net revenues are reduced in 2017 by approximately $2.1 million. The county has been able to reduce the year over year costs associated with operating the municipality. The 2017 budget takes into consideration large expenses such as the projected uncollectable tax losses of $800,000 and the impact of the provincial carbon levy.
The carbon levy has a direct impact on the operating budget of approximately $120,000 with an additional increase expected in the cost of goods and services in both the operating and capital sides of the budget, as vendors will be passing on their increased costs to the County.
On the capital side of the budget, the County has budgeted $2.9 million for its annual gravel purchase, $1.2 million for 68 miles of shoulder pull, and another $4 million (carried over from 2016) for its ongoing road rebuild program as approved in the Kneehill County Road Master Plan. It has allocated the 2017 and remaining 2016 Municipal Sustainability Initiative funding to the purchase of gravel and to the contract shoulder pull program. Carry over funds from the 2016 capital budget are being used to fund the 2017 road rebuild projects.
The 2017 Operational budget continues to prioritize core services such as road maintenance, snow removal, water distribution, solid waste, parks, and agricultural services.
It was Council’s goal to complete the 2017 budget with rationalized service delivery that did not sacrifice the quality of those same services. As a result, there is an ongoing commitment to its roads program throughout both the capital and operating budget. Other services residents have come to expect are included in the 2017 financial plan such as dust control, sponsorships, and other grant funding programs that support the community. Through the Regional Urban Sustainability Grant, money has been set aside to also support small towns and villages, recognizing that each community is vibrant, unique and have its own identity.
Council is also looking towards 2018 and the budgetary challenges that Kneehill County will face in future years. It is anticipating further losses in industrial taxation and current forecasts show that in 2018 it can expect an approximate $2 million dollar loss of net County revenues with a corresponding drop in residential assessments. Council will be considering all possible options to minimize the impact of the projected future loss of revenues.
Our previous decisions have left us in a strong financial position with significant cash reserves and no debt. Council pledges to continue to work in a responsible manner for residents.
The 2017 Operating and Capital Budgets are available on the Kneehill County website.
