Annual Budget Policy

Policy statement

The Corporation of the Town of Oakville (Town), through its commitment to accountable and fiscally responsible financial management, will follow a budget process in accordance with Ontario Regulation 530/22 subsections 7-9. Decisions made with regards to the operating budget, capital budget, staff complement, and reserve management are to be consistent with the goals set out by Council in its Strategic Plan and ensure that budget plans support economic growth, maintain infrastructure, respond to changing needs and are fiscally responsible.

Purpose

The purpose of this policy is to:

• Ensure that the budget process is in accordance with Ontario Regulation 530/22 subsections 7-9, also known as Strong Mayor Powers;
• Enable staff and Council to make informed choices about the provision of programs and services the Town offers;
• Ensure that evidence-based decisions are used to determine how resources are allocated to Town programs and services;
• Ensure that the budget plans presented by staff are consistent with the goals set out by Council in its Strategic Plan and Official Plan;
• Ensure existing infrastructure is maintained in an efficient and effective manner and that new assets are well planned for in accordance with the Town’s Strategic Asset Management Plan;
• Establish a foundation for monitoring actual expenditures and revenues against budgeted expenditures and revenues;
• Promote community input and participation from interested parties in the budget process.

Scope

This policy applies to all Town programs in accordance with Ontario Regulation 530/22 subsections 7-9, also known as Strong Mayor Powers.

Budget Principles and Strategies

The success of the Town’s budget process rests on a solid foundation of budget principles. The Town will maximize program efficiencies while maintaining program effectiveness by focusing on results and outcomes. The principles and strategies that the Town utilizes in making decisions related to short-term and long-term budgeting include:

1. Strategic Plans – Council’s Strategic Plan, Official Plan, and various master plans serve as the guiding documents under which all Town initiatives are aligned. The budget should align with these plans and support it.
2. Sustainability – the Town’s operating and capital budgets incorporate a long-term perspective and should be affordable today and in the future. Annual budgets will ensure that programs and services valued by Oakville residents continue to be offered in an efficient and sustainable manner. Recurring revenues will be incorporated into the Town’s base budget and revenue diversification should be maximized. Budget plans should ensure existing infrastructure is maintained and that growth is well planned for.
3. Affordability – innovative service delivery strategies and available financing tools will be explored when balancing the budget to minimize the financial impact of rising costs, growth, and expanding services to ensure that current and future tax rates are maintained at manageable levels.
4. Interdependency – the operating and capital budgets must be reviewed with a coordinated effort as capital expenditures and financing decisions will impact future operating budgets. Debt repayment levels must be managed in accordance with approved policies and reserve and reserve fund requirements need to be well planned to maintain adequate fiscal capacity.
5. Multi-Year Forecast – multi-year forecasts will be developed for operating and capital expenditures, incorporating the operating impacts of capital projects.
6. Performance Budgeting – Program service levels will be defined and performance measures will be utilized and reported on in annual budgets. The Town will prepare trends, comparisons, and other financial management tools to monitor and improve service delivery for programs. The safeguarding of the Town’s assets and resources will be a key management objective.
7. Fee for Service – the Town will ensure that user fees will be utilized to cover costs of appropriate services in accordance with the User Fees policy.
8. Fiscal Capacity – fiscal capacity will be built into budget plans through long-term financial planning and related debt policy and reserve/reserve fund procedure to establish a strong financial position by considering long-term flexibility, reduced financial risk exposure, statutory requirements and credit agency rating criteria. Debt financing will primarily be used for new capital initiatives benefiting new and existing residents over an extended period of time.
9. Communication with the Community – the budget will provide opportunity for community input through a variety of means consistent with Council approved principles for public involvement and statutory requirements.

Definitions

“Capital Budget” means the annual Council adopted plan that identifies gross expenditures and financing for each capital project. “Capital Project” means an undertaking in respect of which expenditures are typically incurred to acquire, improve, or install land, buildings, engineering structures, machinery or equipment including the installation of computer software or for other specific studies or purposes directed by Council.

“Council” means the Mayor and members of Council for the Town of Oakville.

“Operating Budget” means the annual Council adopted plan for expenditures, revenues, staffing levels and service levels for operations of the Town taking place from January 1 to December 31 in a given year.

“Program” means any organizational unit that may encompass one or more related municipal services.