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Infrastructure &
Finance Division
 

Exemption from Inspector Approval for Certain Regional District Service Bylaws

 

Circular No. 07:15
ARCS File#: 195-20

 


 
June 11, 2007
To: All Regional District Chief Administrative Officers, Financial and Corporate Administrators
 
Re: Exemption from Inspector Approval for Certain Regional District Service Bylaws
 

A new regulation has recently come into force, which exempts two types of regional district service bylaws from requiring approval of the Inspector of Municipalities (Inspector), under certain conditions.
 

1. Boundary amendments done through a petition will no longer require Inspector’s approval, provided:

  • The regional district receives a valid and sufficient petition over the proposed area of the service to be changed through the boundary amendment (i.e. the new properties entering the service or the existing properties leaving the service). Please see Schedule A for more information on the petition process.
  • NOTE: In this scenario, a boundary extension and reduction done in the same amendment bylaw is exempt from approval (adding a property to a service while removing a different property from a service), however separate petitions are required.
  •  
     
    The goal of this policy is to remove the Inspector’s approval of all minor boundary amendments, as these can be easily done through petition of the affected property owners. The use of a petition confirms that both the Regional District Board and the residents entering/exiting the service consent to the boundary amendment. All boundary amendments not done via the above method continue to require the Inspector’s approval.

2. Amendments increasing the requisition limit of a bylaw will no longer require the Inspector’s approval, provided:

  • The maximum amount that may be requisitioned for a service does not increase by more than 25 percent over a five year period. Please see Schedule B, which provides an example of how this amount is calculated.
  •  
     
    The goal of this policy is to provide Regional Districts increased latitude in dealing with minor to moderate cost increases for services, without requiring Provincial approval. Any requisition limit increases greater than 25 percent over five years continue to require Inspector’s approval.

Procedures for Bylaws that no Longer Require Inspector’s Approval
All other statutory and procedural requirements for putting the amendment bylaw into force remain, including consent of the participants and regional district board approval through three readings and adoption, as per the Local Government Act (the Act).
 

Bylaws that no longer require Inspector’s approval must still be submitted to the Province upon adoption as per Sections 801.6(2) and 802(7) of the Act. The bylaws are kept on file at the Ministry for a number of purposes and are forwarded to British Columbia Assessment for service area coding. For bylaws requiring coding by BC Assessment, please continue to forward four copies of the map outlining the boundaries of the service area.
 

Background and Consultations:
The following approval exemptions from the Inspector’s approval are based on extensive policy development, consultation and risk analysis undertaken over the past year; including an opportunity for input by all regional districts.
 

Should you have any questions or comments regarding this circular or if you are interested in viewing a copy of the regulation, please contact your financial analyst.
 

Original signed by:
Dale Wall
Inspector of Municipalities
 


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Schedule A -
Detailed Explanation of the Boundary Amendment Calculation

 

Sufficiency of the Petition

  • The corporate officer must determine the sufficiency and validity of the petition to the Regional District Board and certify this determination.
  • A sufficient petition has the signed approval of the owners of at least 50 percent of the parcels representing at least 50 percent of net taxable value of land and improvements in the affected area. Where there are multiple owners of a parcel or a taxable occupier on the property, please refer to Section 212(6) of the Community Charter for more information.
  • A valid petition must do the following:
    • Describe in general terms the service that is provided;
    • Define the boundaries of the proposed amended service area;
    • In the case of a petition to add parcels to a service area, indicate in general terms the proposed method of recovering annual costs;
    • Contain other information the board may require.


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Schedule B -
Detailed Explanation and Example of the Requisition Limit Calculation

 

Requisition Limit Increases of up to 25 percent over 5 years
If an amendment to an establishing bylaw increases the requisition limit by less than or equal to 25 percent over five years, the bylaw does not require the approval of the Inspector. Determining whether the increase to the requisition limit falls within the 25 percent threshold depends on a number of factors. First, we must establish the baseline at a point in time. Then we must establish the value of the requisition limit at the baseline date and determine what constitutes a 25 percent increase above the baseline value.
 

Determining the Baseline at a point time
The “baseline date” is the more recent of:

  • The date five years prior to the date of third reading for the proposed requisition limit amendment, or
  • The date when the bylaw was first adopted (for bylaws established less than five years prior).
Therefore, if the date of third reading was January 11, 2007, the baseline date is January 11, 2002. The “baseline year” is the calendar year in which the baseline date occurs. In the above example, the baseline year would be 2002.
 

Determining what constitutes the baseline value and allowable increase to the Requisition Limit
Essentially, the “baseline value” is the value of the requisition limit in the bylaw at the baseline date.
 

The Act allows Regional Districts to present a requisition limit for a service in one of three different manners (see Section 800.1(1)(e) of the Act for more information):

    Scenario 1 The requisition limit is a dollar amount
  • Eg. the tax requisition amount is $12,000
  •  
     
    Scenario 2 The requisition limit is a rate to be applied to the net taxable value of land and improvements in the service area
  • Eg. The tax requisition rate is $2.50 per $1,000 of net taxable value in the service area
  •  
     
    Scenario 3 The requisition limit is greater of the dollar amount or the rate to be applied to the net taxable value of land and improvements in the service area
  • Eg. the greater of $12,000 or $2.50 per $1,000 of net taxable value in the service area.

Scenario 1 – Requisition Limit is a Dollar Amount
 

The baseline value is simply the dollar amount at the baseline date (eg. $12,000 as at January 11, 2002). Determining the allowable increase in the requisition limit is relatively straight forward. If the dollar value of the requisition limit was $12,000 at the baseline date, the proposed requisition limit cannot exceed 25 percent increase over the baseline amount (e.g. $12,000 x 1.25 = $15,000). Thus, the new requisition limit cannot exceed $15,000.
 

Scenario 2 - The requisition limit is a rate to be applied to the net taxable value of land and improvements in the service area
 

The baseline value is the rate limit at the baseline date applied against the most recent net taxable value of land and improvements from the baseline year.
 

The most recent net taxable value from the baseline year is the most current value of the assessment roll for the baseline year (e.g. 2002 roll) at the time of third reading of the proposed bylaw, taking into account supplementary rolls assessment appeals and other changes to the 2002 roll.
 

Essentially, the requisition limit is applied to the most current net taxable value from the assessment roll for the baseline year. Eg. if the rate limit for the baseline year of 2002 was $2.50/1000 and most current the net taxable value of land and improvements from the 2002 roll is $5,000,000, then the requisition limit = $2.50/1000 x $5,000,000 = $12,500.
 

The maximum value of this requisition limit increase (as determined by multiplying the tax rate by the net taxable value of land and improvements from the current year) cannot exceed 25 percent above the baseline value.
 

Eg. if the baseline value for the requisition limit is equal to $2.50/1000 x $5,000,000 (net taxable value from the baseline year) = $12,500. The requisition limit for the proposed bylaw cannot exceed 1.25 x $12,500 = $15,625. This dollar amount must then be converted back into a rate limit using the most current net taxable value figure from the year of the proposed increase (2007). Let’s assume the net taxable value of land and improvement has increased to $5,100,000 in 2007. The new rate limit cannot exceed ($15,625 x 1000) / $5,100,000 = $3.06/1000.
 

Scenario 3 - The requisition limit is greater of the dollar amount or the rate to be applied to the net taxable value of land and improvements in the service area
 

Under this scenario, the baseline value is simply the greater of the dollar amount or the rate amount as determined from Scenarios 1 & 2. Eg. Greater of $12,000 or ($2.50/1000 x $5,000,000) = $12,500. Therefore, the requisition limit from the baseline is $12,500.
 

The maximum requisition limit is simply the greater of the dollar limit from Scenario 1 and the rate limit from Scenario 2. In the above examples, the new requisition based on the dollar limit would be $15,000, while the rate limit would be $15,625 (or $3.06/1000). Therefore the new requisition limit cannot exceed the greater of $15,625 or $3.06 per $1000 of net taxable value.
 

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