Common Budget questions

Last updated: January 20, 2023

Common questions about the municipal budget process can be found below. 

 

What is the annual Budget Direction report (formerly known as Fiscal Framework)? 

The 2023/24 Budget Direction report was presented to Budget Committee on Friday, November 25, 2022.

The Budget Direction, formerly known as the Fiscal Framework, is presented annually to Regional Council with recommendations for tax and non-tax revenues to accommodate changing operational costs, capital investments, as well as debt and reserve changes. It is also reflective of on-going and emerging opportunities and challenges.

The Budget Direction sets the underlying assumptions that each business unit will build their proposed Operating and Capital Budget on.

Did the Budget Committee accept the 2023/24 Budget Direction report on November 25, 2022?

As outlined in the November 25, 2022, 2023/24 Budget Direction report, the Budget Committee directed the Chief Administrative Officer (CAO) to develop the 2023/24 Budget according to Regional Council's approved priorities, and preliminary fiscal direction. 

This includes a 4.0 per cent increase to the average residential and commercial property tax bill, by preparing proposals for reductions to the operating budget and only use one-time expenses to offset costs in the current fiscal year if matched with an operating budget reduction in subsequent years.

Additionally, the CAO has been directed to: 

  • rescind the direction from the 2022/23 fiscal Budget to include $7 million in the 2023/24 Budget to fund a sidewalk program from capital from operating (meaning funding of capital projects from taxes);
  • reallocate $20 million included in the Strategic Initiative Operating Reserve in 2019 as a potential capital contribution for the construction of a community stadium, to the following reserves:
    • transfer $5 million to the Options Reserve for the Solid Waste Facility capital project;
    • transfer $15 million to the Capital Fund Reserve to fund overcommitments within the capital fund reserve; and,
  • approve a revised debt policy of $1,500 per dwellings and amend capital from operating to be $72.922 million for the 2023/24 Budget.

On November 25, 2022, Budget committee requested that staff come back in January 2023 with proposals on how the municipality can proceed with a 4.0 per cent increase to the average tax bill

What is the 2023 Budget Direction, Assessment, and Revenue Update report, that was presented on January 25, 2023?  

The 2023 Budget Direction, Assessment, and Revenue Update, presented on January 25, 2023, provided an update on the Budget Direction, based on Budget Committee’s November 25, 2022, direction for proposals to achieve a 4.0 per cent increase. An update on Tax Revenues and the PVSC Assessment information, and how it relates to the municipality’s property taxes, was also provided. 

All business units have spent several months identifying areas where reductions could be implemented, while recognizing the need to provide services to a growing municipality. Staff have identified close to 100 reductions to be made while creating the initial the 2023/24 Budget Direction report. Close to 40 of these reductions were straightforward and have been built into the budget. The remaining nearly 60 reductions are being put forward for Regional Council consideration. 

Over the coming weeks, as each business units presents its budget and business plan, the Budget Committee will have the opportunity to do review each of the proposed reductions.

What are the next steps for the 2023/24 Budget process?

The business unit budget and business planning presentations will take place over the coming weeks, where business units will present their proposed Budgets for discussion. Budget Committee will debate Budget changes and refer them for final decision on Wednesday, March 29. Full approval of the 2023/24 Budget will occur on Tuesday, April 25.

Agendas, including presentation times, will be uploaded on halifax.ca by Friday at noon the week before each meeting. The most up-to-date schedule can be found on halifax.ca/budget. It is important to note that this schedule may be adjusted following direction from Budget Committee at any stage of the budget process. Any new dates will be communicated on halifax.ca/budget and on the agendas, meeting and reports web page.

Residents will be given an opportunity to speak directly to Budget Committee during the Budget process. During each meeting, time will be set aside for the public to provide insight and comments. There are two participation options: 

  1. Registered speakers (recommended): Residents can register until 4:30 p.m. the business day prior to the meeting. Registered participants will be called upon to speak in the order in which they registered. Registration information will be included on the agendas, meetings and reports web page for each meeting. For any questions about registration, please contact the Clerk’s Office at 902.490.4210 or by email at clerks@halifax.ca. 
  2. Non-registered speakers: During each meeting, after all registered speakers have been called, the Chair will call three times to ask if there is anyone else present who would like to speak. At that time, anyone who has not registered will have the opportunity to speak to the Budget Committee.  

For further information, visit halifax.ca/budget.

Will the average residential and commercial property tax bills will increase by 4.0 per cent in 2023/24?

The approved 2023/24 Budget Direction report seeks proposals for a 4.0 per cent increase to the average residential and commercial property tax bill. Staff are reviewing the direction provided by Budget Committee on November 25, 2022, and will return on January 25, 2023, to present an Assessment/Budget Direction Update.

The business unit and Budget Presentations (Budget Committee) will follow. The schedule can be found on halifax.ca/budgetMeeting dates may be subject to change and any new dates will be communicated on halifax.ca/budget and on the agendas, meetings and reports web page.

It is important to note that the tax rate is not yet final and will be set by Regional Council upon budget ratification, which is targeted for April 25, 2023.

 

What is the 2023/24 Multi-Year Capital Plan? What was approved in the 2023/24 Multi-Year Capital Plan presentation on January 18 and January 20, 2023?

The 2023/24 Multi-Year Capital Plan sets out the proposed capital plan for the next four years. The 2023/24 Multi-Year Capital Plan prioritizes the infrastructure investments that not only focus on existing and anticipated growth but also those that have long-term value to the municipality, including buildings, roads, bridges, and recreation centres.

This rolling four-year plan is updated annually as timing, scope, funding of projects and infrastructure funding opportunities can change.  

Below is the final motion from the January 18 and January 20, 2023, Budget Committee:

THAT the Budget Committee recommends that Halifax Regional Council: 

  1. Approve the Base Capital Budget for 2023/24, and approve in-principle the Schedule of 2024/25, 2025/26, 2026/27 Base Capital Plan set out in Attachment 1 of the staff report dated January 11, 2023.
  2. Approve the Strategic Initiatives Capital Budget for 2023/24, and approve in-principle the Schedule of 2024/25, 2025/26, 26/27 Strategic Initiatives Capital Plan as per Attachment 2 of the staff report dated January 11, 2023.
  3. Approve the schedule of 2023/24 Capital Reserves Withdrawals as per Attachment 4 of the staff report dated January 11, 2023.
  4. Approve the schedule of 2023/24 Multi-year Capital Projects as per Attachment 5 of the staff report dated January 11, 2023.
  5. Direct the Chief Administrative Office to prepare a staff report with options, funding sources and strategies for the 2024/25 and 2025/26 Capital Budgets for the Bedford Library within Mill Cove and a Fire Station in the Larry Uteck West Bedford Area.
  6. Request a briefing note with options to fund library Capital Budget projects at their 2022/23 approved allocations for 2023/24 budget approvals within the proposed 2023/24 Multi-Year Capital Plan to the Budget Adjustment List.
  7. Direct the Chief Administrative Officer to prepare a briefing note to provide options to fund the West Bedford Fire Station on Science Park Drive within the proposed 2023/24 Multi-Year Capital Plan and refer the matter for discussion as part of the Budget Adjustment List.
  8. Include a reduction of $755,000 for one-time reduction to CR21001: Urban Forestry Plan Implementation as outlined in the Briefing Note BN002 within the proposed 2023/24 Capital Budget.
  9. Include an increase of $3,000,000 for new sidewalks, Active Transportation CR 200001, within the proposed 2023/24 Capital budget, including funding options, to the Budget Adjustment List as a capital over budget option for consideration, beginning in 2024/25.
  10. Request a Briefing Note with an update on the 2014/15 approved project, “MacDonald Park Ball Field Lighting” (deferred due to land tenure) including:
    1. Confirmation of the continuation of project planning in 23/24;
    2. Information on tenure arrangements, leasing, timing related to land tenure, design & construction, and operating implications; and,
    3.  A recommendation for inclusion in the capital budget for design and construction to the Budget Adjustment List.
  11. Direct the Chief Administrative Officer prepare a briefing note to provide options to advance the funding of the Capital Projects for the Eastern Shore Lifestyle Centre (Sheet Harbour Fire Station – CB210018 & Sheet Harbour Recreation Centre – CB000080) to commence over 2024/25 & 2025/26 fiscal years instead of the current timeline in the Capital Budget Book.
What are the Capital Budget challenges for 2023/24?

Similar to previous budgets, the Capital Budget is facing several challenges: 

  • Rapid population growth and demands for additional services are adding pressure to this imbalance. This growth brings tremendous opportunities for the Halifax region, as well as new homes that require municipal services. There is also an expectation of a higher level of servicing across the entire municipality, including investments in rapid transit, inclusive growth and complete streets;
  • The portion of the capital budget funded directly from municipal revenues, capital from operating (meaning funding of capital projects from taxes), is not keeping pace with needs; and,
  • Delays and gaps in the industries’ supply chain, as well as the labour market, have caused extensions to project delivery timelines and increased vendor costs; sometimes costs are doubling their original estimated costs. This is putting pressure on the municipality’s reserve balances and further deferring necessary maintenance activities.
What is the Climate Action Tax?

As outlined in the approved 2022/23 Budget, the Climate Action Tax is to implement the Strategic Initiatives of HalifACT. The tax will also be used to leverage climate action funding from the private sector, federal and provincial governments, providing the necessary investment for the success of HalifACT in the years to come.

Funds from the Climate Action Tax will directly support HalifACT, which includes projects such as electric vehicles and buses, net-zero buildings and projects to improve the resiliency of communities and infrastructure. 

It is anticipated that the Climate Action Tax will remain in place for at least the next 10 years, with the associated rate determined annually. For the 2023/24 Budget and onward, the Climate Action Tax is a part of the base budget and does not factor into the tax increase required to balance the budget.

For more information about the Climate Action Tax, visit: halifax.ca/halifact and see these common questions.

What is the Property Valuation Services Corporation Assessment Roll? 

The Assessment Roll provides the assessed values for property taxation purposes and is updated and released once a year by Property Valuation Services Corporation (PVSC). These assessments are provided to each municipality, as well as individually to each property owner. PVSC is an independent, municipally funded, not-for-profit organization that provides property assessment services and information to Nova Scotia’s municipalities and property owners.

On January 9, 2023, PVSC provided an overview of provincial assessment changes that have taken place over the past year. Residents (property owners specifically) should expect to receive their 2023 Assessment Notice in the coming days.

As per direction from PVSC, property owners will have until midnight on February 9, 2023, to appeal their assessment to PVSC. PVSC can be reached by phone (1.800.380.7775) or email (inquiry@pvsc.ca), Monday to Friday from 8:30 a.m. to 4:30 p.m. For more information, visit: pvsc.ca.

How will the 2023 Property Valuation Services Corporation Assessment Roll affect property owners?

The 2023 Assessment Roll does not determine the municipality’s 2023/24 tax revenues; it simply establishes the total assessment base that the municipality uses for taxation. 

The Assessment Roll will not change the debated tax bill increase, as assessment increases were anticipated and estimated into these options.

It’s important to note that the tax bill is made up of the assessment (set by Property Valuation Services Corporation) multiplied by the tax rate (set by the municipality). 

Staff will present an update to Regional Council on Wednesday, January 25, with revised 2023/24 impacts on the average residential tax bill, using the average assessment of a single-family household in the municipality, as well as the required municipal property tax rate under the direction provided by Budget Committee on November 25, 2022.

What mitigation efforts have been taken by the municipality?

The mitigation efforts employed during 2022/23 are now depleted, and the municipality is faced with balancing increasing cost of services with households already coping with inflation.

As directed by the CAO, business units spent several months scrutinizing their budgets. Through that exercise, the municipality identified $20 million in savings through a number of efforts which include, but are not limited to, asking business units to find a collective $7 million in cuts and removing the proposed sidewalk funding increase. On November 25, 2022, Budget Committee gave direction to reduce street recapitalization budget by $8 million in the 2023/24 Budget only.

Staff will now take the direction provided by Budget Committee on November 25, 2022, to find further reductions in the operating budget. Staff will return in January 2023 with proposals on how the municipality can proceed with a 4.0 per cent increase to the average tax bill.

What are some anticipated pressures on this year’s 2023/24 Budget?

The 2023/24 Budget Direction report was designed in the face of significant inflationary pressures, some of which include:

  • Population growth – The municipality’s population is expected to reach half a million residents before the end of the decade. This growth brings tremendous opportunities for the region, as well as new homes that require municipal services. There is also an expectation of a higher level of servicing across the entire municipality. 
  • Deed Transfer Tax revenue decreases – Recently, the municipality has been relying on the revenue from Deed Transfer Tax to mitigate otherwise larger tax increases. Over the last few years, Deed Transfer Tax has represented a greater proportion of the municipality’s tax revenue than has been seen since amalgamation. Compared to five or six years ago, Deed Transfer Tax doubled as a percentage of the municipality’s tax revenue. In 2022/23, it represented 12.8 per cent of total tax revenue. However, the Bank of Canada has increased interest rates to counter inflation, resulting in a cooling housing market which has had a negative effect on Deed Transfer Tax revenues. For the first time in five years, it is expected to decrease and continue to decline. The municipality can no longer continue to rely on this variable source of revenue to offset otherwise necessary increases to property tax.
  • Operating pressures increasing – Inflation is causing all expenditure categories to increase. Together, with the impact on wage demands and the labour shortages, hiring the people that the municipality needs to deliver services remains challenging. Simultaneously, the cost of fuel, goods and services have all risen dramatically.
  • Available reserves balance nearing capacity – While reserve balances remain strong, most are committed to current or future Capital or municipal Strategic Initiative (SI) projects, and little funding capacity remains to respond to unexpected issues or opportunities. 
  • Strategic Initiatives and climate action – Significant strategic city building programs, such as HalifACT and the Integrated Mobility Plan (IMP) are not fully funded within existing capital budget levels. In the 2022/23 Budget, there were actions taken to begin funding these initiatives. The Strategic Capital reserve was created to accumulate the funds that will be used to pay the principal and interest on the debt that will be issued to fund these Strategic Initiatives. Additionally, the Climate Action Tax (CAT) was passed with the goal of funding the first four years of HalifACT projects. Increasing project costs, as well as increasing debt borrowing costs will require future tax increases to complete these Strategic Initiatives. This is why staff are recommending maintaining current levels of funding to the SI projects.
  • Debt is a limited tool – Unlike other levels of government, the municipality is legislatively bound to approve a balanced budget and is not able to use debt to fund its on-going operations. Decreasing capital from operating – meaning funding of capital projects from taxes – will only result in projects being cancelled or delayed, primarily projects focused on maintaining existing assets in a state of good repair. 

As a result, the 2023/24 Budget Direction report was designed to address three key areas:

  • coping with expenditure growth;
  • maintaining a path toward fiscally sustainability; and,
  • maintaining funding for Strategic Initiatives and base capital funding.
How would the proposed tax increase for 2023/24 impact future Budget considerations?

For several years, the administration has been recommending longer term sustainability – through proposed tax modifications – which will safeguard the municipality’s ongoing expenditures against external factors, such as inflation. 

Was the community engaged on the 2023/24 Budget process?

Yes. The 2022 Municipal Services Survey was conducted between September 12 and September 29, 2022. The survey was available both online and in a paper-based format to all municipal residents.

The survey focused on residents’ satisfaction with municipal services, where residents would like to see investments in municipal services and programs, and included a section on HalifACT, the municipality’s climate action plan.

The results of the Municipal Services Survey are intended to inform the 2023/24 business planning and budgeting process. There were 4,030 responses to the survey. Results were provided to Regional Council on November 22, 2022. The report can be found here.

The Municipal Services Survey is conducted every two years, alternating with the more detailed and in-depth Resident Survey. The 2022 Municipal Services Survey is an abbreviated version of the 2021 Resident Survey and is intended to be a ‘pulse survey’ to supplement the more rigorous Resident Survey, at a lower cost.

The 2023/24 Budget consultation process also seeks to solicit public comment by inviting members of the public to provide feedback following each business unit budget and business plan presentation.

Will there be an opportunity for residents to provide input before the 2023/24 Budget is finalized?

Yes. Each business unit will present their proposed budget to the Budget Committee. The 2023-24 Budget & Business Planning Schedule can be found here (option 1). It is important to note that this schedule may be adjusted following direction from Regional Council at any stage of the budget process.

Agendas, including presentation times, will be uploaded on halifax.ca/budget as they become available.

Residents will be given an opportunity to speak directly to Budget Committee during the budget process. During each meeting, time is set aside for the public to provide insight and comments.

Participation options:

Registered speakers (recommended): Residents can register until 4:30 p.m. the business day prior to the meeting. Registered participants will be called upon to speak in the order in which they registered. Registration information will be included on the Agenda page for each meeting. If you have questions about registration, please contact the Clerk’s Office at 902.490.4210 or by email at clerks@halifax.ca.

Non-registered speakers: During the meeting, after all registered speakers have been called, the Chair will call three times to ask if there is anyone else present who would like to speak. At that time anyone who has not registered will have the opportunity to speak to budget committee. 

Please note: Meeting dates may be subject to change and any new dates will be communicated on halifax.ca/budget and the agendas, meetings and reports web page.   

Budget Committee will debate Budget changes and refer them to Regional Council for final decision on Tuesday, April 25, 2023.

Full approval of the budget is currently scheduled for Tuesday, April 25, 2023. 

What was the purpose of the Strategic Multi-Year Business Planning and Budget Process and 2023/24 Budget Outlook report, presented on October 25, 2022?

The Strategic Multi-Year Business Planning and Budget Process and 2023/24 Budget Outlook report, presented to Regional Council on October 25, 2022, marked the start of the 2023/24 Budget and Business Planning process. This report provided a high-level overview of the background, changes and updates, proposed key dates and milestones, financial challenges and budget implications. 

What is the Business Planning and Budget schedule?

On November 8, 2022, Regional Council approved the revised 2023-24 Budget & Business Planning Schedule as outlined in Option 1 of the Strategic Multi-Year Business Planning and Budget Process and 2023/24 Budget Outlook report

It is important to note that this schedule may be adjusted following direction from Regional Council at any stage of the budget process. Any new dates will be communicated on halifax.ca/budget.

What did the approved 2022/23 Budget include?

In April 2022, Regional Council approved the 2022/23 Budget, which saw an increase to the average tax bill by 4.6 per cent. Part of the increase, 3.0 per cent, was directed specifically to HalifACT, the municipality’s climate action strategy. The remaining 1.6 per cent was used to fund the operations of the municipality. 

As the 2022/23 Budget was approved, inflation began to become more prevalent in the municipality, Canada, as well as the global economy. To hedge off the impact of inflation to the 2022/23 Budget, staff recommended using $8 million in surplus funds from the 2021/22 fiscal year.

As the municipality begins to build its budget and business plans for 2023/24, it is forced to tackle the inflation that began in early 2022 and has since escalated. The mitigation efforts employed during 2022/23 are now depleted and the municipality is faced with balancing increasing cost of services with households already coping with inflation.

What are some highlights from the past year?

Throughout the many challenges and opportunities presented to the municipality, the municipality remained focused on fostering the growth of healthy and vibrant communities, a strong and diverse economy, and a commitment to environmental sustainability.

The cityscape continues to evolve as the municipality undertakes major redevelopments like the Cogswell District and Windsor Street Exchange. Addressing these main intersections in such a comprehensive way will be transformative for generations to come.  

The Integrated Mobility Plan continues guide the municipality’s investment in active transportation, transit, roadways and more. The municipality has made significant progress building a bikeway network in the regional centre, designed for people of all ages and abilities. In addition, the municipality has invested in transit infrastructure including the recently renovated Woodside Ferry Terminal and the new West Bedford Park & Ride, improving access to public transportation across the region.  

The municipality is prioritizing a commitment to diversity, inclusivity and equity. The ongoing advancement of the Accessibility, Anti-Black Racism and Women & Gender Equity strategies will continue to raise awareness and action to ensure municipal spaces, services and programs are accessible and welcoming for all. 

The municipality is leading the way in efforts to address climate change as outlined in the HalifACT climate action plan. 

A Strategic Performance Report 2021/22 was presented to Budget Committee on November 22, 2022, and included highlights, accomplishments and performance results associated with the previous year.

View highlights from the 2022/23 Budget in the 2022/23 Budget Overview, including $10 million in approved capital budget spending toward HalifACT, the municipality’s long-term climate action plan for the 2022/23 fiscal year.