Budget Components

Main Budget Components 

Operating Budget

The operating budget pays for the day-to-day activities of the organization such as salaries and wages, grass cutting and utilities. This includes:

  • Base Service Adjustments: Typically, “non-discretionary” items required to maintain existing services, such as wages, utility increases and contract increases

  • One-Time Adjustments: Non-recurring expenditures, such as the consulting studies, maintenance projects, etc.
  • Growth-related items: Any costs or revenues that have been added above previous years’ service levels
  • Operating Impacts from Capital Projects: Anticipated expenditures from approved Capital Projects, such as the operating costs associated with a newly constructed facility and long-term borrowing installments

Capital Budget

The capital budget pays for all the new municipal infrastructure investments and the rehabilitation of existing Town-owned assets.

The Town also prepares a 10-year capital forecasting tool to assist with the prioritization of capital projects while not losing sight of competing priorities when developing the capital budget. 

As mentioned earlier, funding capital projects is also included in the operating budget and in the overall levy requirements for the budget year. 

The impacts of capital projects on operating are:

1. Capital levy - pay as you go model, these fund projects that do not have any planned saving (reserves) or are not large enough for long-term borrowing.

For 2018 the levy requirements were as follows:

Capital Levy $1,292,000
Operating Levy $13,890,535
Total Levy Requirements $13,890,535

This is what we need to collect from the taxpayers (residential, commercial, & industrial) to fund both the capital and operating budgets for the Town. Note: This doesn’t mean we only spent 1.29M on capital, it means the other 10+ million (of the overall 2018 budget) was from development charges & reserves.

2. Reserve fund contributions - planned saving, dollars set aside through the operating budget to help fund the capital asset projects.  The Town contributes dollars for the equipment replacement reserve, facility maintenance reserve and the infrastructure replacement reserve.

3. Long-term borrowing payments - the annual repayment (principal and interest) when long-term borrowing is issued to fund for a capital projects.  Long-term borrowing is an important Capital Budget financing tool, which allows the Town to spread out the cost of the project to be paid not just by today’s taxpayer, but by future users as well. 

Water & Wastewater Rates

This budget is allocated to pay for the provision of three essential water and wastewater:

  1. Delivery of clean drinking water
  2. Wastewater collection and removal
  3. The infrastructure and maintenance of the Town’s water and wastewater systems

On average, 50% of each utility bill paid to the Town of Lincoln also covers Niagara Region’s water & wastewater costs.

There is a shared responsibility for the treatment and distribution - the Town acts as a retailer in the distribution of water to the resident, while the Region acts as a wholesaler to the municipality

In 2017, Council adopted a new rate model:

  • Results in no increase to the variable water rate (usage) annually
  • Allocates an annual increase to the base charge (fixed)
  • Includes a seasonal rate that decreases over high season from June to August for variable wastewater (usage)
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