254_2004 — Municipal Liabilities Regulation

s. 1 — Definitions and interpretation

s. 1(1)

In this regulation:

s. 1(1) — annual expenditure

annual expenditure means, in relation to a commitment,

s. 1(1)(a)

in respect of actual costs, the average annual actual costs, calculated as divided by

s. 1(1)(a)(i)

the total of the actual costs associated with financing the commitment over the term of the commitment,

s. 1(1)(a)(ii)

the number of years in the term of the commitment, and

s. 1(1)(b)

in respect of commitments that are not yet realized, the average annual implied costs, calculated as divided by

s. 1(1)(b)(i)

the total amount of the commitment that might be realized over the remaining term of the commitment,

s. 1(1)(b)(ii)

the number of years remaining in the term of the commitment;

s. 1(1) — calculation liability

calculation liability means a calculation liability within the meaning of section 3 of this regulation;

s. 1(1) — revenue sharing taxes

revenue sharing taxes means Class 4 property value taxes imposed by one municipality, a portion of which is paid over to another municipality as tax sharing revenue;

s. 1(1) — tax sharing revenue

tax sharing revenue means revenue

s. 1(1)(a)

paid to another municipality as referred to in section 4 (a) (ii) of this regulation, or

s. 1(1)(b)

received from another municipality as referred to in section 4 (b) of this regulation.

s. 1(2)

Except as otherwise provided in this regulation, the terms used in this regulation are to be interpreted consistently with the recommendations and guidelines issued by the Public Sector Accounting Board as authorized by The Canadian Institute of Chartered Accountants.

1

Liability Limit

s. 2 — Liability limit

For the purpose of section 174 (2) [limit on borrowing and other liabilities] of the Community Charter, a municipality may not incur a liability if

s. 2(a)

at the time it proposes to incur the liability, exceeds

s. 2(a)(i)

the annual cost of servicing the aggregate liabilities of the municipality for the year, as determined in accordance with section 3 of this regulation,

s. 2(a)(ii)

25% of the annual calculation revenue of the municipality for the previous year, as determined in accordance with sections 4 and 5 of this regulation, or

s. 2(b)

incurring the liability would cause the annual costs referred to in paragraph (a) (i) to exceed the limit established by paragraph (a) (ii).

s. 3 — Annual costs of servicing aggregate liabilities

The annual cost of servicing the aggregate liabilities of a municipality for a year is the total of the annual expenditures for the year, determined for each of the following types of calculation liability:

s. 3(a)

Type 1 — general capital commitments: in relation to a liability of the municipality that the calculation liability is the current and non-current commitments in relation to the liability;

s. 3(a)(i)

is or includes a non-current commitment,

s. 3(a)(ii)

is of a capital nature, and

s. 3(a)(iii)

is not covered by paragraphs (b) to (e),

s. 3(b)

Type 2 — contingent capital commitments: in relation to a liability of the municipality that the calculation liability is the commitments in relation to the liability;

s. 3(b)(i)

is a contingent commitment,

s. 3(b)(ii)

is of a capital nature, and

s. 3(b)(iii)

is not covered by paragraphs (c) to (e),

s. 3(c)

Type 3 — debts under loan authorization bylaws: in relation to a liability of the municipality that is the amount of debt borrowed under a loan authorization bylaw, the calculation liability is the outstanding amount of that debt;

s. 3(d)

Type 4 — unused borrowing under loan authorization bylaws: in relation to the amount of debt that is authorized by a loan authorization bylaw but not yet borrowed, the calculation liability is the amount not yet borrowed, excluding any amount authorized to be borrowed under section 179 (1) (c) [guarantees of borrowing by others] of the Community Charter, for which the borrowing authority has not yet expired;

s. 3(e)

Type 5 — loan guarantees: in relation to any loan guarantee given by the municipality the calculation liability is the total amount the municipality would be or is required to pay under the guarantee.

s. 4 — Annual calculation revenue

The annual calculation revenue of a municipality for a year is the total revenue of the municipality from the following sources for the year:

s. 4(a)

subject to section 5 [cap on Class 4 property revenue] of this regulation, revenue referred to in section 192 (a) to (f) of the Community Charter, other than

s. 4(a)(i)

revenue received under section 197 (1) (b) [municipal taxes for others] of that Act, and

s. 4(a)(ii)

tax sharing revenue paid to another municipality as provided for by letters patent;

s. 4(b)

subject to section 5 [cap on Class 4 property revenue] of this regulation, tax sharing revenue received from another municipality as provided for by letters patent;

s. 4(c)

unconditional grants under the Local Government Grants Act;

s. 4(d)

payments in place of taxes that are made by a public authority;

s. 4(e)

revenue received under an agreement, other than gifts or grants received under an agreement or amounts included as revenue under another paragraph of this section;

s. 4(f)

revenue received under the Peace River Agreement between the Province of British Columbia and the Peace River Regional District and the municipalities within the boundaries of the Peace River Regional District;

s. 4(g)

revenue received under an agreement between the Provincial government and the municipality under which the Provincial government pays amounts in relation to a casino operating in the municipality, other than any portion paid over to another municipality under an agreement respecting this revenue;

s. 4(h)

revenue received from another municipality as referred to in paragraph (g);

s. 4(i)

revenue received under section 5 [compensation to local governments] of the Ports Property Tax Act;

s. 4(j)

investment income, other than

s. 4(j)(i)

revenue from the disposition of assets, and

s. 4(j)(ii)

Municipal Finance Authority actuarial adjustments;

s. 4(k)

revenue received under the Infrastructure Development Contribution Agreement between the Province of British Columbia and the Northern Rockies Regional Municipality.

s. 5 — Cap on Class 4 property revenue

s. 5(1)

In this section:

s. 5(1) — assessed value

assessed value means the assessed value of property, other than property that is exempt from taxation for municipal purposes;

s. 5(1) — Class 4 calculation rate

Class 4 calculation rate in relation to a municipality for a year means, as applicable,

s. 5(1)(a)

the tax rate, or total tax rates, established to impose the municipality's Class 4 property value taxes for the year, if this is equal to or less than the average municipal tax rate on Class 4 property in British Columbia, as determined by the inspector of municipalities, or

s. 5(1)(b)

in any other case, the average municipal tax rate on Class 4 property in British Columbia for the year, as determined by the inspector of municipalities;

s. 5(1) — Class 4 calculation value

Class 4 calculation value in relation to a municipality for a year means, as applicable,

s. 5(1)(a)

the total assessed value of Class 4 property in the municipality for the year, if this total is equal to or less than 20% of the total assessed value of all property in the municipality for the year, or

s. 5(1)(b)

in any other case, 20% of the total assessed value of all property in the municipality for the year;

s. 5(1) — Class 4 property

Class 4 property means property that is in the Class 4 property class;

s. 5(1) — Class 4 property value taxes

Class 4 property value taxes means taxes imposed under section 197 (1) (a) [municipal property value taxes] of the Community Charter on Class 4 property.

s. 5(2)

General rule: A municipality's calculation revenue from Class 4 property value taxes for a year must be determined as multiplied by

s. 5(2)(a)

the Class 4 calculation rate for the year

s. 5(2)(b)

the Class 4 calculation value for the year.

s. 5(3)

Tax sharing revenue — paying municipality: If a municipality pays tax sharing revenue to another municipality in a year, the following apply for the purpose of determining the Class 4 calculation value for the paying municipality for the year:

s. 5(3)(a)

the total assessed value of Class 4 property in the municipality for the year is deemed to be minus

s. 5(3)(a)(i)

the assessed value of Class 4 property in the municipality for the year

s. 5(3)(a)(ii)

the portion of the assessed value of Class 4 property that is subject to revenue sharing taxes imposed by the municipality equivalent to the portion of those revenue sharing taxes that is paid over to another municipality as tax sharing revenue, and

s. 5(3)(b)

the total assessed value of all property in the municipality for the year is deemed to be minus

s. 5(3)(b)(i)

the assessed value of all property in the municipality for the year

s. 5(3)(b)(ii)

the portion of assessed value of Class 4 property referred to in paragraph (a) (ii).

s. 5(4)

Tax sharing revenue — receiving municipality: The following apply if a municipality receives tax sharing revenue from another municipality in a year:

s. 5(4)(a)

for the purpose of determining the Class 4 calculation value for the receiving municipality for the year,

s. 5(4)(a)(i)

the total assessed value of Class 4 property in the municipality for the year is deemed to be the total of

s. 5(4)(a)(i)(A)

the assessed value of Class 4 property in the municipality for the year, and

s. 5(4)(a)(i)(B)

the portion of the assessed value of Class 4 property that is equivalent to the portion of those revenue sharing taxes that is paid over to the receiving municipality as tax sharing revenue, and

s. 5(4)(a)(i)(B)(I)

in another municipality, and

s. 5(4)(a)(i)(B)(II)

subject to revenue sharing taxes imposed by the other municipality

s. 5(4)(a)(ii)

the total assessed value of all property in the municipality for the year is deemed to be the total of

s. 5(4)(a)(ii)(A)

the assessed value of all property in the municipality for the year, and

s. 5(4)(a)(ii)(B)

the portion of assessed value of Class 4 property referred to in subparagraph (i) (B);

s. 5(4)(b)

the Class 4 calculation rate for the receiving municipality for the year is deemed to be the rate that would be required in order to generate the revenue received by the municipality from

s. 5(4)(b)(i)

the Class 4 property value taxes imposed by the municipality, and

s. 5(4)(b)(ii)

the revenue sharing taxes imposed by another municipality and paid to the receiving municipality.

2

Exemptions from Elector Approval Requirement

s. 6 — Commitments that are not calculation liabilities

Approval of the electors is not required under section 175 (2) [liabilities under agreements] of the Community Charter unless the liability is one of the following:

s. 6(a)

a liability of a capital nature, whether or not it is or includes a contingent commitment;

s. 6(b)

a loan guarantee given by a municipality.

s. 7 — Approval-free liability zone

Approval of the electors is not required under section 175 (2) [liabilities under agreements] or section 180 (1) [loan authorization bylaws] of the Community Charter if

s. 7(a)

at the time it proposes to incur the liability, does not exceed

s. 7(a)(i)

the annual cost of servicing the aggregate liabilities of the municipality for the year, as determined in accordance with section 3 of this regulation,

s. 7(a)(ii)

10% of the annual calculation revenue of the municipality for the previous year, as determined in accordance with sections 4 and 5 of this regulation, and

s. 7(b)

incurring the liability would not cause the annual cost referred to in paragraph (a) (i) to exceed the limit established by paragraph (a) (ii).

s. 8 — Drinking water protection orders — installation of treatment works

Approval of the electors is not required under section 175 (2) [liabilities under agreements] or 180 (1) [loan authorization bylaws] of the Community Charter if

s. 8(a)

the liability is to be incurred for the purpose of complying with an order of a drinking water officer under the Drinking Water Protection Act that expressly requires the municipality to install treatment works, and

s. 8(b)

the inspector of municipalities approves the proposed liability.

s. 9 — Liquid waste management plans

Approval of the electors is not required under section 175 (2) [liabilities under agreements] of the Community Charter if the liability is to be incurred for the purpose of the inspector of municipalities approves the proposed liability.

s. 9(a)

preparing or revising, under the direction of the minister under section 24 (3) (a) of the Environmental Management Act, a waste management plan respecting the management of municipal liquid waste, or

s. 9(b)

implementing all or part of, or an amendment to, a waste management plan approved by the minister under section 24 (5) of the Environmental Management Act respecting the management of municipal liquid waste, and