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Infrastructure &
Finance Division
 

Regulation 338/02 - Regional District Financial Operations

 

Circular No. 02:28

 


 
December 10, 2002
To: All Regional District Financial Administrators and Auditors
 

The attached regulation brings into force those outstanding sections of the Local Government Statutes Amendment Act, 2000 (known as “Bill 14”), effective January 1, 2003. These amendments ensure that the key areas of regional district financial management, particularly the requirement for Five Year Financial Plans, are consistent with those for municipalities.
 

The changes to Division 5 of Part 24 of the Local Government Act (the Act) were outlined in the August 2000 Bulletin D.7.0.0.0, “Regional Districts: Financial Operations”. The bulletin advised that the changes were to be implemented in two stages, effective August 30, 2000, and January 1, 2003.
 

A table is attached which outlines these amendments to the Act, as well as to the Municipal Finance Authority Act, and the Parks (Regional) Act.
 

Highlights of the new provisions include:

  • A regional district is required to adopt a five-year financial plan (FP) bylaw; the bylaw must be adopted annually by March 31 [section 815]. The financial plan may be amended by bylaw at any time. The requirements for the regional district FP are similar to those for municipalities, but the regional district FP must set out the proposed expenditures, funding sources and transfers between funds for each service.
     
  • The proposed amount of revenue from property value taxes or parcel taxes for a service must not exceed the amount of the requisition limit in the establishing bylaw, if there is one. Also, the amount requisitioned each year for the service must not exceed the amount of property value tax and parcel tax revenue for each service as stated in the FP [section 815(10)].
     
  • The "no deficit" rule has been retained: for each service, the proposed expenditures must not exceed the proposed funding sources. A regional district is not authorized to make expenditures other than those included in the FP unless there is an emergency situation [section 817(3)]. Any actual deficit in a service, must be included in the following year's FP as an expenditure for the service [section 815(11)].
     
  • A copy of the FP must be sent to each municipality in the regional district and to the inspector [section 816]. In addition to the bylaw format, each regional district will have to decide what type of documentation would best provide backup for the FP bylaw and to assist in the public consultation process. The bylaw backup and consultation documentation may vary by service, according to the budget, participants and complexity of the service. The Act does not specify the level of detail to be included in the FP bylaw, it only sets out the minimum amount of information that must be included. Each regional district may customize the FP bylaw to best suit their community and to provide continuity with the format of the annual budget from prior years.
     
  • Section 816 requires that the board must undertake a process of public consultation regarding a proposed FP before it is adopted. The Act does not determine the format of this consultation process. It can be as extensive as the board decides is appropriate. Consultation may be on a region-wide basis or on a service-by-service basis or some combination.
     
  • Emergency expenditure procedures: the new section 817 requires a regional district board to establish procedures that identify the types of circumstances that would qualify as an emergency, whereby expenditure can be made that is not in the current year's FP.

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For further information, please contact your financial analyst. As well, a number of regional districts have already adopted a financial plan during the transitional provision period, and you may wish to consult those colleagues.
 

Andrew MacTaggart
Executive Director
Local Government Services and Infrastructure
 

Contacts:
Your financial analyst:
Reception, Local Government Services and Infrastructure
Tel: 250 387-4060; Fax: 250 356-1873
Division Directory
E-mail: Infrastructure and Finance
 


 
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IMPLEMENTATION OF REGIONAL DISTRICT FINANCE SECTIONS OF BILL 14 (2000) – IN FORCE BY REGULATION 338, 2002
 

Sections To Be Implemented
 

Section 282(4) of Bill 14 listed the sections that were to be brought into force by regulation. Most of these sections were brought into force on August 30, 2000, under Regulation 241/2000. The following numbered sections of Bill 14 will now be brought into force with Regulation 338, 2002, effective January 1, 2003.
 

Bill 14 section (page) Impacts old section – Local Government Act Action
 
section 2(d) and (i) pg. 01 5 - definitions (loan authorization bylaw, security issuing bylaw) Amended
section 94 pg. 33 788 - remuneration & expenses
789 - director benefits
Repealed
section 98 pg. 34 791(7) - voting on resolutions and bylaws Amended
section 105  pg. 62 806(2) - requisition of funds for electoral areas Amended
section 107  pg. 73 813.03(3)(b)(i) (d)(i) – reference to budget, now financial plan Amended
section 114 pg. 73 Div. 5 of Part 24 (814 - 836) – see details in Section B below Repealed & replaced
section 116 pg. 80

838(12) - local community commissions

Repealed
section 118 pg. 80

841 - default on payments by municipalities

Repealed
section 138 pg. 84 882(3)(a)(i) - reference to capital expenditure program Amended

 
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Bill 14 section (page) Impacts old section –
Municipal Finance Authority Act
Action
 
section 236 pg. 106 11(1)(a) to (c) - Interim Financing Repealed & replaced
section 237 pg. 107 11.1(a) - Financing – RD reference Amended
section 238 pg. 107 15(2) - Debt reserve fund Repealed & replaced
  Impacts old section Parks (Regional Act)  
 
section 246 pg. 108 10 - Borrowing powers Repealed & replaced

 
The details of the new Division 5, Part 24 sections are as follows:
 

New section Title Replaces
 
814 General accounting rules
  1. 814(1)
  2. 814 (7)
  3. 826(1)
  4. 826(2)
815 Financial plan New replaces 819, 819.1
816 Process requirements for financial plan New
817 Limit on expenditures New 819(8)
818 Limit on borrowing and other liabilities New
819 Application of municipal provisions New 334.2
335
335.2, 335.3, 335.5
834
820 Liabilities under agreement
  1. 828(2)
  2. 828(3)
  3. 828(4)
  4. new
822 Revenue anticipation borrowing 829
823 Loan authorization 831
824 Financing municipal undertakings 835
825 Security issuing bylaws may combine borrowing 833(1)
826 General liability provision
  1. 836
  2. 841(1)

 
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