2018-2022 Financial Plan

FINANCIAL POLICIES and FUND STRUCTURE

Debt Management Policy The policy is to use debt with caution when there is a strong business case for tying up future resources for today’s project. External debt will be minimized by first looking to existing reserves as a means to internally finance required capital expenditures. Even if funding is likely to be internally financed, the direction has been to still seek all the approvals necessary for external borrowing including public assent to ensure that the process is as transparent as possible. Maple Ridge adheres to the Debt Limit and Liability Servicing Limit requirements as outlined in Section 174 of the Community Charter which sets a limit on borrowing and other liabilities and provides authority for Cabinet to limit either the aggregate liabilities of a municipality, or the annual cost of servicing the aggregate liabilities and for a method for determining that limit. BC Regulation 254/2004 (Municipal Liabilities Regulation) limits the annual cost of servicing certain defined liabilities. Basis of Financial Planning Maple Ridge develops its Five-Year Financial Plan in accordance with Generally Accepted Accounting Principles (GAAP). Maple Ridge uses the accrual method of accounting for reporting revenues and expenditures. Revenues are recorded in the period they are earned and Expenditures are recorded in the period they are obtained. The budget is prepared on a similar basis with slightly more emphasis on cash flow and matching the funding associated with the expenditures. All financial and operational policies related to accounting practices are adhered to in the development of the Five-Year Financial Plan. The budget is organized by fund or type of operation (i.e. general fund and utility funds), with each fund considered a separate budgeting and accounting entity. Budgets are presented for each department or operational area (i.e. Engineering, Parks & Open Spaces, Leisure Centre and Human Resources) and detailed to the account level (i.e. contract, equipment and salaries).

FINANCIAL POLICIES Governing Policy and Regulatory Requirements Part 6 Division 1 of the Community Charter and Part 24 Division 5 of the Local Government Act require Municipalities and Regional Districts to prepare a Financial Plan annually. The Financial Plan must be adopted by bylaw and cover a minimum of a five year period; year one relates to the year in which it comes into force, years two through five are the following four years. The Financial Plan from the previous year remains in place until the Financial Plan for the current year is adopted. Municipalities may adopt the Financial Plan bylaw at any time before the date on which the annual property tax bylaw is adopted (the annual property tax bylaw must be adopted after the adoption of the Financial Plan but before May 15). Regional Districts must adopt their Financial Plan bylaw by March 31. The Financial Plan can be amended by bylaw at any time [Community Charter s. 165(2) and Local Government Act s.815(2)]. Balanced Budget In compliance with Section 165 of the Community Charter , the Financial Plan must be balanced. The Financial Plan must not plan for a “deficit.” This means for each year of the plan, the total of proposed expenditures and transfers to other funds must not exceed proposed funding sources plus transfers from other funds [Community Charter s.165(5) and Local Government Act s. 815(5)]. If actual expenditures and transfers to reserves exceed actual revenues and transfers from other funds in any one year, the resulting deficiency must be included as an expenditure in the Financial Plan for the next year [Community Charter s. 165(9) and Local Government Act s.815(11)]. Investment Policy It is a fiduciary responsibility to protect public funds and to prudently manage investments in order to achieve the investment objectives of safety, liquidity and return.

Maple Ridge  Financial Plan 2018-2022

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