City of Brampton - Another Reason to Implement a Budget in 2015

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1 Frequently Asked Questions What is new in Budget 2015? This year the City has moved to a full accrual budgeting process that will provide stakeholders with a better understanding of the long-term financial health of the municipality. What is full accrual budgeting? Full accrual budgeting includes both cash and non-cash items. Non-cash items, such as depreciation (wear and tear of assets), that are shown on the financial statements were not previously included in budget documentation. What effect will this new full accrual budgeting have on my property taxes? Full accrual budgeting will not change the way property taxes are calculated. Property taxes will not increase or decrease based on this change in accounting. How was the budgeting done before? In the past, operating budgets for the City of Brampton were based solely on the property taxes needed to be raised in the calendar year to fund operational expenditures (e.g. salaries, fuel, contracted services, contributions to capital). What is changing with full accrual budgeting? Going forward, although property taxes will still be calculated and collected for operational expenditures, the City will also be budgeting for non-cash requirements such as wear and tear of assets (depreciation), assets transferred to the City from developers (local roads and parks), and post-retirement liabilities (e.g. health benefits). Why has the City of Brampton decided to change to full accrual budgeting? This approach will provide stakeholders with a better reflection of the long-term financial health of the municipality and improve the decision making process. The City of Brampton will be one of the first municipalities in Ontario to implement full accrual budgeting. Taxes will not change as a result of this change in accounting.

2 What is the business planning and budget process at the City of Brampton? Each year the City identifies priorities, goals and initiatives that ensure good use of resources and link back to our Strategic Plan. Public input is key to the entire process and residents are encouraged to get involved. Here s the how the process works: Budget Sub-Committee provides direction and feedback on strategic priorities to guide the budget process Budget Committee reviews business plans and budget requirements as submitted by the different departments, and makes recommendations to Council Review includes revisions and reprioritization of needs, taking into consideration strategic priorities, associated costs and public input Council reviews recommendations and approves budget How do I get involved? The City of Brampton encourages residents to get involved in the budget process. There are many ways you can get involved: Public workshops Committee meetings Online questionnaire Online Budget allocator Announcements on dates and locations will be made through media and on the City s budget webpage. In addition, you may contact your local Councillor or the Mayor at any time. This is your City. Your tax dollars. Get involved. Where do my property tax dollars go? The City of Brampton collects taxes for the Province of Ontario (for school boards), Region of Peel, and the City of Brampton. Every dollar of the property tax goes a long way: Province of Ontario - 18 cents Region of Peel 38 cents City of Brampton 44 cents

3 In 2014, the City portion was approximately 43% of the total taxes collected, with another 1% going towards the hospital levy. School Boards 18% City of Brampton 43% Region of Peel 38% Hospital Levy 1% The City portion of the residential property tax bill provides the following services (based on the 2014 budget): Fire & Emergency Services Public Works Transit Parks Maintenance & Operations Recreation Contribution to Capital Reserves Buildings & Property Mgmt Corporate Services Brampton Public Library Grant Financial Administration Human Resources Planning, Design & Development Economic Dev't & Communications Arts, Culture & Theatres Mayor & Members of Council Peel Memorial Hospital Levy 8.0% 7.1% 6.3% 5.9% 4.4% 4.2% 2.5% 2.1% 0.9% 2.8% 14.8% 16.7% 18.3%

4 What is the difference between the current budget and capital budget? The current budget covers ongoing operating expenses of the City and the capital budget covers long-term investment in infrastructure. Current budget Also known as an operating budget, the current budget includes all anticipated current expenditures and revenues related to the ongoing operations of the City. Expenditures include salaries, goods, services, transfers to reserves. Revenues include property tax and user fees. The shortfall between expenditures and nontax revenues results in the portion that must be raised by property taxes. Capital budget The capital budget includes money spent on building, buying or improving capital infrastructure such as roads, buildings, vehicles and major equipment. What is the hospital levy? A Reserve Fund was established in March 2010, when Brampton City Council committed up to $60 million towards the community portion of the suggested $420 million cost to re-develop the Peel Memorial Hospital site. This commitment is dependent on the provincial government making its own funding commitment to the hospital project. In the 2012 Budget, Council set aside $1 million for this initiative. In 2013, in response to public input, Council approved a six-year annual $9.8 million contribution to the reserve fund from The additional levy will be removed after the 2018 budget year. The money collected from taxpayers is scheduled to be paid out to Peel Memorial Centre for Integrated Health and Wellness (PMCIHW) in 2016 ($20 million) and 2018 ($40 million) or upon substantial completion of each of the two phases of the project. The new facility is on target to begin operation in For more information, and updates, see Build Peel Memorial:

5 Besides property taxes, what other sources of funding does the City have? Most of the City s funding comes from property taxes. Other sources of funding include: User fees Development charges (capital budget only) Grants and subsidies from other levels of government (restrictions apply) Investment income Contributions from reserves How do Brampton s property taxes compare with other municipalities nearby? Based on 2014 figures, for equivalent homes, Brampton s property taxes are low compared to surrounding municipalities. Single Detached (3 bedroom, 1,200 square feet) Markham $4,825 Vaughan $4,360 Oshawa $4,013 Mississauga $3,984 Whitby $3,854 Hamilton $3,747 Brampton $3,657 Oakville $3,512 Richmond Hill $3,476 Burlington $3,410 Senior Executive (4-5 bedroom, 3,000 square feet) Markham $6,206 Oshawa $6,087 Oakville $6,055 Hamilton $5,995 Whitby $5,962 Vaughan $5,931 Burlington $5,817 Mississauga $5,702 Richmond Hill $5,672 Brampton $5,598 Source: 2014 BMA Management Consulting Inc.