TAMRMS#: B06
10.1
REQUEST FOR DECISION
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Financial Policy Updates for C-FS-01, C-FS-03 and C-FS-05
Presented by: Suzanne Findlay, Manager, Financial Services
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RECOMMENDED MOTION(S)
That amendments to the following Council policies, provided as attachments, be approved:
• C-FS-01 Financial Reserves
• C-FS-03 Debt Management
• C-FS-05 Budget and Taxation Guiding Principles
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SUMMARY
To bring forward amendments to C-FS-01 Financial Reserves, C-FS-03 Debt Management and C-FS-05 Budget and Taxation Guiding Principles in accordance with previous Council direction and administrative recommendations.
ALIGNMENT TO COUNCIL DIRECTION OR MANDATORY STATUTORY PROVISION
On April 7, 2026, Council passed the following motions:
CM-26-010
That Council Policy C-FS-05, Budget & Taxation Guiding Principles, section 14(b)(v) is amended to change the threshold to be eligible to apply the prior year's assessment growth from 5% tax increase to 3.5% tax increase.
CM-26-011
That Council amend Financial Policy C-FS-05 to revise the allocation of new assessment growth as follows:
1. Reduce the allocation to New Growth Business Cases from 55% to 45%; and
2. Increase the allocation to the Growth Stabilization Reserve by 5%; and
3. Allocate 5% of new assessment growth to a newly established Debt Offset Reserve for the purpose of reducing reliance on tax-supported debt financing for future capital projects; and
That Administration update Financial Policy C-FS-05 and return any necessary bylaw amendments establishing the Debt Offset Reserve for Council approval by July 14, 2026.
BACKGROUND AND DISCUSSION
The approval of Council motions CM-26-010 and CM-26-011 require updates to Council Financial Policies C-FS-01 (Financial Reserves), C-FS-03 (Debt Management), and C-FS-05 (Budget & Guiding Principles). Administration has also reviewed the policies and proposes recommendations to ensure the policies are up to date.
Updates arising from Council motions CM-26-010 and CM-26-011:
Financial Reserves Policy (C-FS-01)
• Growth Stabilization Reserve (Schedule C6)
o Implementation of an annual transfer of 5 per cent of assessment growth into the Growth Stabilization Fund.
o Creation of a new Debt Fund to manage the annual 5 per cent transfer of Assessment Growth to support future debt servicing.
o Update the portion of new assessment growth not applied to 45 per cent.
Debt Management Policy (C-FS-03)
• Update to reflect the new assessment growth allocation and application of the budgeted prior years assessment growth allocation to the Debt Fund against new tax-supported debt servicing costs.
Budget and Taxation Guiding Principles (C-FS-05)
• Update to reflect the new assessment growth allocation as follows:
o 45 per cent to fund new initiatives;
o 20 per cent as a contribution to Lifecycle Reserves;
o 25 per cent to offset the base budget;
o 5 per cent transfer to the Growth Stabilization Fund; and
o 5 per cent transfer to a newly established Debt Fund within the Growth Stabilization Reserve.
• Addition of provisions specifying that budgeted prior years assessment growth allocation to the Debt Fund will be applied to offset increases in tax-supported debt servicing costs.
• Amendment to 45 per cent from 55 per cent of the unallocated portion that can be transferred to the Growth Stabilization Reserve.
• Amendment to reduce the threshold at which prior year assessment growth may be applied from supporting a 5.0 per cent tax increase to 3.5 per cent.
Updates arising from Administration:
Financial Reserves Policy (C-FS-01)
• Safety Enhancement Reserve (Schedule O7)
o Update to include the previously approved annual transfer of $30,000 for safety training costs. The annual reserve transfer consists of $230,000 for investments through the safety enhancement program and $30,000 for safety training costs, but the reserve did not reflect the training costs portion.
• Lifecycle Reserve (Schedule C4)
o Include as a funding source the net proceeds from the sale of any lifecycle assets initially funded from the reserve.
General
• Update verbiage to add more clarity.
• Update definitions where necessary.
STAKEHOLDER COMMUNICATIONS OR ENGAGEMENT
N/A
IMPACTS OF RECOMMENDATION(S)
Financial:
None at this time.
Compliance & Legal:
Recommended changes will ensure that Council policies are up to date, support best practice, and reflect specific direction provided by Council.
Program or Service:
None at this time.
Organizational:
None at this time.
Risks
Development of financial policies and procedures to ensure appropriate financial internal controls are in place. Fiscal responsibility is ensured through monitoring and compliance of policies and procedures. Risks of not updating the policies would include not having sufficient internal controls in place and not having clear direction.
ALIGNMENT TO PRIORITIES IN COUNCIL’S STRATEGIC PLAN
Not Applicable
ALIGNMENT TO LEVELS OF SERVICE DELIVERY
N/A
IMPACTS OF ALTERNATIVES CONSIDERED
If Council does not wish to support the proposed motion, Administration presents the following alternative for Council’s consideration.
ALTERNATIVE 1:
Council may approve only some of the recommendations provided or may provide specific alternate direction for Administration to incorporate.
Financial:
None at this time.
Compliance & Legal:
If policies are not updated, there is a risk that Council policies are out of date or irrelevant. In addition, the policies may not support best practice and may not reflect previous direction provided by Council. Some of the recommendations are related to previous Council direction and are required to be incorporated/excluded into/from the relevant policies.
Program or Service:
None at this time.
Organizational:
None at this time.
Risks
None at this time.
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Report Date: July 14, 2026
Author(s): Melissa Francis
Department: Financial & Strategic Services
Department Director: Anne Victoor
Managing Director: Diane McMordie
Chief Administrative Officer: William Fletcher