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Budget 101

The annual Business Plan and Budget sets out how the City plans to allocate resources to achieve Council’s Plan for a Better Barrie and deliver the services that residents and businesses rely on every day.

The Business Plan & Budget is financed by a combination of property taxes, user fees and other financing sources. The City’s budget includes three elements:

Tax rate based operating budget: Ongoing programs and services funded primarily from a combination of property taxes, user fees and reserves. These services are delivered either by the City or by one of its service partners.

User rate based operating budget: Ongoing programs and services funded primarily from user fees and reserve funds, based on user rates intended to make the programs and services self-sustaining. These include Parking, Water and Wastewater.

Capital budget: Routine and non-routine projects designed to create, enhance or restore the service potential of the City’s significant network of assets, which include infrastructure (roads, bridges, buildings etc.); land; equipment and vehicles. The capital budget is funded from a combination of property taxes, development charges, debt issuance, grants and reserves.

2016 Business Plan Development Schedule

June 2015 Committee/Council approval of the 2016 Budget Directions
June – Sept. 2015 Staff produce work plans; draft operating, capital, and rate budgets; informal updates with the Finance and Corporate Services Committee will occur throughout the development schedule
Oct. 2015 • Council Workshop
• Public engagement events commence
Dec. 2015  2016 Business Plan distributed to Council
Jan. 2016 Committee/Council review & approval

Council Direction

In June 2015, Council directed staff to prepare the 2016 Business Plan for all tax-supported services that considers:

  • the cost of maintaining current programs at current service levels, based on anticipated 2016 activities;
  • annualized prior period decisions (if the costs of a program or service change based on only a partial year, costs for 2016 needed to include the entire year's cost)
  • the financial impact on the 2016 budget of Council directions throughout 2015;
  • recommendations for changes to funding sources that result in a decreased reliance on property taxes;
  • an estimate of assessment growth based on the value of newly assessed property throughout 2015;
  • the continuation of an annual 1% Dedicated Infrastructure Renewal Fund;
  • contributions to reserves consistent with the Financial Policies Framework;
  • inclusion of water, wastewater, parking, service level changes, 10-year capital plan with one-year capital budget, a four-year forecast, and a five-year outlook.

Budget Drivers

Cost to Maintain Existing Service Levels: Like a resident, the City’s costs increase every year. Prices for utilities — natural gas, hydro — and materials increase. These increased costs impact the City’s Budget. The City works hard to find efficiencies to reduce cost increases, but they do have an impact on the property tax

Service Partners & Education: There is only one property tax bill. Of the residential property tax bill, 54% funds City services, 15% funds education, as mandated by the Province, and 31% funds the City’s service partners such as the Barrie PolicePublic Library and services delivered by the County of Simcoe such as Land Ambulance and Social Services. 

Infrastructure Gap: Like most municipalities, the City of Barrie has a significant gap between the amount of money available each year to maintain its infrastructure and the amount of money needed to ensure infrastructure remains in a state of good repair. That’s why the City created a Dedicated Infrastructure Renewal Fund that’s used only for the replacement and rehabilitation of Barrie’s roads, bridges, buildings and other infrastructure. View projected debt reduction.

Service Partners

In 2016, services directly controlled by the City account for 54% of the property tax bill. Other services are provided by service partners. These include Barrie Police, the County of SimcoeLibrary Board and Conservation Authorities (NVCA, LSRCA).

Frequently Asked Questions

Where does the City’s money come from?

The majority comes from residential and commercial property taxes. Other sources of revenue include user fees, Development Charges (capital budget), grants & subsidies from other levels of government and contributions from reserves.

Where does the City’s money go?

Of Barrie's 2016 residential property tax bill, 54% funds City services, 15% funds education, as mandated by the Province, and 31% funds the City’s service partners such as the Barrie Police, Public Library and services delivered by the County of Simcoe such as Land Ambulance and Social Services.

What are ‘reserves’ and ‘reserve funds’?

Similar to savings accounts, reserves and reserve funds receive regular (annual) contributions as part of the budget process. They are a critical component of the City’s long-range financial plan as they strengthen our financial sustainability, help to minimize fluctuations in the tax rate, provide funding for infrastructure and provide the flexibility to manage debt within the City’s Debt Policy.

A reserve is established by Council for a specific purpose but the funds do not relate to any particular asset and there is no requirement for the reserves to earn interest. Reserves are created either through a planned contribution established in the budget process or through the transfer of unspent funds at the end of a year. Any transfer of unspent funds at year end must be authorized by Council.

A reserve fund is similar to a reserve except that the reserve fund assets are segregated and restricted to meet the purpose of the reserve fund. There are two types of reserve funds; obligatory and discretionary reserve funds. Obligatory reserve funds must be created whenever a statute or legislation requires funds received for special purposes be segregated from the general revenues of the municipality i.e. Development Charges. Discretionary reserve funds are established through a by-law of Council for a specific purpose. Investment income generated by reserve funds must be accumulated in the reserve fund and accounted for as part of it.

What is Barrie’s infrastructure?

Our infrastructure refers to the physical assets that the City uses to deliver services to our community. The City of Barrie currently owns $3.5 billion worth of infrastructure, which includes our roads, bridges, storm water drains and sewers, streetlights, sidewalks, community centres, water treatment facilities, buses and much more.

Why does infrastructure matter?

Just like we need strong bones to keep us healthy and active, cities need well-maintained infrastructure to keep our communities safe, healthy and livable. It makes people and businesses want to locate here and is a key ingredient to building and supporting a strong, vibrant city.

Why is it important to maintain our infrastructure?

Maintaining our infrastructure is important not only because it saves us money on expensive emergency repairs, but also because it helps protect the health and safety of our citizens by decreasing the risk of a major failure such as a water main bursting or road crumbling.

How is Barrie’s infrastructure funded and what does it cost to maintain it?

Infrastructure is funded through a combination of property taxes, reserve funds, development charges, debt financing and funding from Provincial and Federal Governments through gas taxes. According to Barrie’s Asset Management Plan, the City should be investing $86 million each year to keep our infrastructure well maintained. However, we are only investing $30 million, resulting in an annual gap of close to $55 million.

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