Budget and Forecasts
What is a budget?
A budget is a financial plan that estimates costs, revenues and resources to achieve a desired outcome over a specified period of time. The base budget is the approved budget from the previous fiscal year. The proposed budget factors in inflationary impacts, service level changes and one-time items / reversals.
The municipal budget process is government by legislative parameters including Section 290, 291 and 293 of the Municipal Act, as well as O. Reg. 284/09, O. Reg. 453/07, and O. Reg 588/17.
What is a forecast?
A multi-year forecast is a “living document” that relies upon a set of underlying assumptions and economic indicators to project future financial conditions.
Budget and Forecast
The Township prepares a Budget Report on an annual basis, which includes a consolidated budget for the current fiscal year, a multi-year operating forecast and a 10-Year capital forecast.
The process of assembling a consolidated multi-year budget and forecast requires significant effort, co-ordination, and collaboration across the organization. Through effective teamwork, across departments and within the Budget / Finance team the budget report is prepared and tabled with Council for information.
This budget report is built using best practices in municipal budgeting with guiding principles and long-term integrated financial planning. Long-term integrated financial planning in Mapleton continues to mature and evolve with an increasingly more sophisticated ability to model our financial performance into the future, allowing for efficient and effective allocation of public funding.
The seven (7) core guiding principles referenced by staff in building the budget include:
- Openness and Transparency
- Public Engagement
- Fiscal Responsibility
- Inflationary Pressures
- Property Tax vs. Rate Based
- Growth Pays for Growth
- Modernization / Efficiency
While the overriding principle of building an annual budget is to execute the initiatives identified within the Strategic Plan, there are also base, everyday service obligations that the Township must continue to deliver. Base costs impacted by inflationary pressures include compensation, contractual commitments, insurance, utilities, facility repairs and fleet maintenance. On top of these everyday operational costs are debt servicing obligations to fund critical infrastructure investments.
The Township also needs to consider its funding strategy to maintain and replace aging infrastructure assets. As infrastructure ages, adequate funds must be committed for proper maintenance, repair and replacements. The most reliable source of funding for the maintenance and replacement of core and non-core infrastructure is the annual transfer of tax levy funded to infrastructure reserve funds. Continuation of this levy funding with inflationary considerations will ensure the optimal level of funding is achieved in the future, as the Township strives for long-term fiscal sustainability in supporting a holistic culture of asset management.