GFOABC Dollars & Sense – June 2022 - Issue 119

Dollars & Sense P e r s p e c ti v e

Issue #119 • june 2022

Disaster Preparedness and Recovery Local Government Interest in Land Strategies for Council Budget Support

p r es i d e nt ’ s m es s ag e in this issue President’s Message 2 Executive Director’s Message 4 Conference Overview 5 How Insurance Partners can Support Disaster Preparedness and Recovery 6 Introducing … Jason Tollman 7 Establishing a Single Source of Asset Truth to Enhance Long-Term Strategic Plannings 8 Introducing the New Addition to the MFA Team 10 Is it Time to Term? 12 Attend our PSAB Roundtable for Municipalities on Natural Resources and Sustainability 13 Protecting Linear Infrastructure: Enhancing Community Resilience

by Reducing Protection Gaps 14 Local Government Interests in Land – Property Taxes and Exemptions 16 New Vehicles for the Same Old Budget … or Less 18 Strategies for Getting Council to Understand and Support Your Budget 20 Collectors’ Corner 22 Quarterly Question 23–24 Thank You Exhibitors 25 Thank You Sponsors 26 2 | GFOABC.CA

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eturning to work after such an inspirational “Next Level” conference, has me feeling a sense of relief and calm, especially after experiencing such intensity over the last couple years. It was encouraging to see that most had remained connected through virtual networks and that our membership appears more engaged than ever before.

The 2022 GFOABC conference, Next Level Finance, led us in so many directions from thinking about bias in our workplaces, to planning for the future; and from thinking about what kind of value we can offer our employees, to relishing Pecha Kucha Time! It was a glorious week of networking, vast learning opportunities, and laughter. It was just what we needed!

I’ve had numerous conversations with sponsors and presenters about how involved our membership was throughout the conference week. I am honoured to represent such a passionate membership.

The involvement of our membership was encouraged by the topical program developed by GFOABC’s staffing team through the dedicated leadership of Kala Harris, Executive Director. Kala and her

team successfully offered a virtual and in-person conference which was well attended by over 400 members. Better yet, because the entire conference was streamed virtually, you can go back and watch or re-watch any sessions from the week via your conference app.

As we begin the next board term to focus on a new set of priorities through the support of our committees, the board will revisit the strategic plan to ensure that our vision, mission, and values remain strong. We will take the results from the conference focus group to further develop the leadership competency framework, and we will continue to work with sponsors and partners to continue to develop educational content relevant to our members.

We encourage you to continue to access the GFOABC forum to share resources and remain connected to one another until you have an opportunity to meet up again at the many offerings yet to come in 2022 such as Boot Camp, Quarterly Forums and Fall PD. As humans we need to connect; we need to be a part of a community.

As public servants, we care deeply about community and it was apparent

to me that this is what drives our passion to learn more and do more.

Let’s continue to reach out and stay connected and in the spirit of staying connected, GFOABC Board and staff members are here to connect with should you have any questions, comments, and suggestions.

Enjoy your summer and I hope you all find an opportunity to recover and relax after a very busy tax season!

Board of Directors President Nyla Attiana Vice President Rianna Lachance Secretary-Treasurer Talitha Soldera Past President Lorraine Coughlin

Directors at Large Julia Aspinall Jeannie Bradburne Shelley Hahn Kathy Humphrey Lenora Lee Elio Iorio

Staff Kala Harris, Executive Director Jason Tollman, Manager, Member Services & Communications Stephanie Kast, Manager, Professional Development & Education Gerilee McBride, Graphic Design

Nyla Attiana, GFOABC President

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e x e c uti v e d i r e c t o r ’ s m es s ag e Penticton or Bust!

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e did it! This year’s conference marked a highly anticipated return to in-person events— the first in more than two and a half years.

Not being ones to rest on our “virtual” laurels, our first in-person event was also our first-ever hybrid event—an effort worthy of the phrase “Penticton or Bust!”

The conference program featured an array of inspirational and impactful sessions— thirty in total. The agenda included two amazing keynote speakers tackling the topics of bias and reconciliation.

Plenary sessions focused on themes of ESG, purpose, digital transformation, and the future of work. Forum sessions included discussion topics around municipal tax sales, accounting for natural assets, and best practices for managing fraud during a pandemic. The conference wrapped up with a light-hearted Pecha Kucha session on innovation.

We would like to extend our sincere thank you to our members, sponsors, and exhibitors for joining us in person in Penticton and online for our first hybrid conference. We would also like to extend a heartfelt thank

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you to all of our conference speakers whose donation in lieu of speakers’ gifts enabled us to continue our annual donation to the YMCA kid’s camp program. This year the YMCA of the Okanagan received a donation of $2,500.

A big thank you to Lya Iglesias from Every Aspect Management for overseeing the event planning, the team at SW Audio Visual for their onsite and online production, Gerilee McBride for graphic design, and Cindy Dale for communications support. AND thank you to the newest member of the GFOABC team, Jason Tollman!

Last, but not least, thank you to the GFOABC Board of Directors and Committee Members for their continued participation in delivering the conference and for their support this past year.

We hope everyone will join us again in Whistler for the 2023 Annual Conference!

Kala Harris, Executive Director

Excellence In Local Government Finance Awards Conference Overview

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fter 3 years of virtual conferences, the 2022 edition was the first to go hybrid. Hosting over 400 delegates both in-person in Penticton and virtually from across BC, Next Level Finance could not have been a greater success.

Featuring 30 sessions, including powerful & thought-provoking keynotes by author Jessica Nordell & activist Jesse Wente, plenaries covering topics like ESG, financial resiliency & the future of the workplace, and an unforgettable & hilarious PechaKucha, this year’s Annual Conference was truly memorable.

Thank you to all our sponsors, exhibitors, and especially our membership community, none of this would’ve been possible without you. We can’t wait to see you next year at the Fairmont Chateau in gorgeous Whistler.

THANK YOU YWCA

SUPPORTING LOCAL COMMUNITIES AROUND BC In lieu of a speaker’s gift, the GFOABC was proud to make a donation of $2,500 to the Okanagan YWCA. With the help of our speaker’s generosity, we hope our contribution helps continue the work the YWCA does for families and communities in the Okanagan.

Innovative Idea – Team: Nelson Chan and the CRD Financial Services Team.

Challenging legacy financing acquisition approach to regional parkland.

Outstanding Achievement Individual Doug Spindler, Assistant Director, Treasury Services.

Advocate for expanded investment options for local governments.

Outstanding Achievement Team Alexander Ralph, Chief Procurement Officer, City of Vancouver.

Social procurement Outstanding Contribution Individual Lenora Lee, KPMG. Thank you for all you’ve done for the GFOABC over the course of your time with us. You’ve been and continue to be a valued member of our community and Board.

Julia Aspinall, City of Vancouver.

Although you’ve only been working in local government for two years, you’ve made amazing contributions to the City of Vancouver, the GFOABC Board and our association as a whole.

Congratulations on your new role on our Board as Director at Large.

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How Insurance Partners can Support Disaster Preparedness and Recovery

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cross B.C., catastrophic events are occurring with a sobering frequency and intensity due to climate change. As local governments are front and centre in dealing with the effects of the climate emergency, it is important to understand how your insurance and broker partners can support your local government, from planning to building back better.

The emergency management framework provides a useful lens to examine the many ways an insurance broker partner can provide crucial support in dealing with catastrophic events.

PREVENTION AND MITIGATION Take advantage of all the value-added assistance your broker or insurer provides to improve local government resiliency. These services can include: • Loss control inspections to identify and advise how to mitigate risks; and • Risk management grants or other funding mechanisms to help implement risk-reduction measures.

PREPAREDNESS Having a business continuity plan provides a roadmap to allow you to continue your operations, collect revenue, and serve your community when catastrophes strike.

Most insurance brokers can provide you with tools and resources to assist you with your business continuity planning.

When undertaking your business continuity planning: • Consider both your emergency response plan and your business continuity plan. Together they will allow you to provide stable service to your community and give you a foundation to “build back better”.

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• Involve your insurance broker in your business continuity plan discussions to ensure you have the right level of insurance available to meet your specific needs. Clarify where insurance will respond and where it will not, so you can plan reserves accordingly.

RESPONSE As a catastrophic event unfolds, a strong relationship with your insurance broker or insurance provider is extremely helpful. Establishing continuous communication is critical to ensure you receive timely and seamless assistance during the response phase. Your insurance broker may be able to support you throughout the event by: • Contacting you early on to provide timely advice; • Advocating on your behalf by explaining the claims process and, where necessary, looking to maximize coverage available to cover losses; • Providing support and advice to your emergency operations centre staff; and • Reviewing the insurance and indemnity provisions of contracts with other parties to highlight coverage gaps or exposures.

RECOVERY The recovery phase can involve a myriad of challenges and frustrations. Delays in the recovery process are extremely common. With a strong insurance partner on your side, you can take advantage of some crucial supports to minimize the financial impacts of delays. These supports might include: • Securing professions, trades and vendors required for the rebuild; • Access to additional insurance coverages required during recovery (such as course of construction or environmental impairment liability insurance);

I nt r o d u ci n g …

T • Assistance in reconstructing documents in the event they are destroyed in a loss; and • Facilitating sharing and collaboration amongst other peers with similar past experiences.

Insurance is an important tool available to local governments to remain financially resilient in the wake of disasters, and a supportive insurance partner is key to building a more resilient future.

The MIABC has developed the Response Ready service to help member local governments deal with the threat of catastrophic losses. For more information, contact the MIABC at AskUsAnything@ miabc.org.

NICOLE PURVES is the Director of Insurance Services at the MIABC. Nicole has worked in the insurance industry for over 25 years, primarily involved in claims handling and commercial insurance services.

She has been with the MIABC since 2008.

She has also received her designation as a Chartered Insurance Professional and is also a licensed insurance broker.

o the members of the GFOABC, In my new role as Manager of Member Services & Communications, it’s my job to facilitate discussion and collaboration amongst yourselves and your organizations. This is a responsibility I am thrilled to take on, and one that I do not take lightly.

My career to date has been built on three core skills: relationship building, communication, and project management. It’s with those skills that I plan on expanding on the amazing work this community has already done over the past 30-plus years.

I’m what you’d call a people person, and my natural relationship-building skills have served me well in a variety of roles from sales to project management, PR to news anchoring. The saying goes “people buy from people” and choosing to become a member of an organization is no different. It’s not just your communications and marketing that people notice, it’s how they are treated at every interaction that informs decision making. People enjoy working with me because of my ability to ask the right questions and add value with thoughtful communication.

I have a strong point of view that success in communication is about telling compelling stories. Like an authentic relationship, stories connect on a level that facts alone cannot. The right story conveys important information concisely and comprehensively while remaining conversational and personal.

Sharing client stories has been a secret weapon for me in sales and is a craft I honed through years in the newsroom. I recently returned to my roots in storytelling as the producer of CHEK News’ 6:00 newscast with Joe Perkins. Every day I interacted with the public while balancing the demands of the show, writing compelling stories, and managing large-scale events, including the 10th Anniversary Road Show and Rock for Relief Covid Benefit Show.

I look forward to getting to know all of you and I thank you for trusting me with this opportunity.

Jason Tollman, Manager, Member Services & Communications

JUNE 2022 • DOLLARS & SENSE PERSPECTIVE | 7

Establishing a Single Source of Asset Truth to Enhance Long-Term Strategic Planning

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hrough collaboration with other senior staff, Financial Officers play a pivotal role in defining organizations’ operations and levels of service. Key responsibilities include leading the sustainable allocation of limited resources through the development of longterm financial plans, as well as evaluating organizations’ performance through the preparation of financial statements. This annual process is met with a set of unique challenges, one of which being data collection. Without a single source of asset truth, Financial Officers face barriers that deter confidence required in long-term strategic planning and performance evaluation.

A sole asset ledger containing data collected from multiple departments ensures consistency, accuracy, and that the information is up to date. Yet many local governments have multiple data registries for separate departmental functions, resulting in silos of data.

The use of individual data sets is represented in Figure 1, demonstrating four different systems collecting Figure 1. Example of Data Silos

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data: Tangible Capital Asset registry, Asset Management registry, Computerized Maintenance Manager System (CMMS), and Geographic Information System (GIS).

Figure 1 also shows the variety of reporting and planning documents produced by each system. This type of data collection system leads to inefficiencies and may result in data inaccuracies.

A single system that hosts all of an organization’s asset data will diminish the risks associated with siloed data and ultimately achieve greater productivity and efficiency. Figure 2 establishes a process that produces a single source of asset truth. By having one single system, all activities related to each asset are updated in one central registry, removing the redundancy of departments updating their ledgers independently.

Additionally, having one central system enables departments to access data that they may not otherwise have access to, increasing reporting flexibility across the organization.

Figure 2. Data system with a Single Source of Asset Truth

While organizations work towards a central system, they can begin adapting their processes and follow simple steps to achieve a single source of asset truth.

1. First begin by defining the organization’s broad objectives during the development of Official Community Plans, Strategic Objectives, Departmental Plans, and integrate with the budgeting process.

2. Next, identify data requirements for the organizational objectives. For example: • Finance Reporting: capital budgets, operating budgets, TCA/ARO reporting and performance measures.

• Asset Management Planning: risk and lifecycle analyses, levels of service frameworks.

• Organizational Operations: maintenance requirements and service requests.

3. Begin classifying categories of data by key indicators that are required for each reporting, planning, and operational requirements. These categories can be tailored to your organization’s preferences and will establish a data hierarchy system required by all departments within your organization. Examples of categories include: • Identifiers - import ID, location, GL Accounts • Classification - category/segment, department • Valuation - replacement cost, historical cost • Attribute Data - dimensions/size/diameter, material, make/model • Assessment - assessed condition, utilization • Interventions - type of intervention, time of intervention

4. Establish a data governance policy/framework to ensure that data is being updated in all inventories.

Doing so will ensure that all data is being updated in each departments’ inventories until a central system is implemented.

5. The final step involves the implementation of a centralized software solution that houses the sole source for data to evaluate performance and produce reports with confidence.

JEFF MUIR is a Regional Manager at PSD Citywide. As Regional Manager, Jeff leverages his 13+ years of experience in asset management software and consulting to help clients overcome business challenges by using technology to deliver real, lasting results. Jeff’s focus is working with clients to evaluate their unique needs and consulting on how they can make practical and meaningful advancement in their practices related to asset management, maintenance management, permitting, and budgeting.

PETER PAINE is the Senior Manager of Financial Advisory Services at PSD Citywide.

Peter is an established accounting professional with over a decade of experience in accounting, budgeting, forecasting, and modeling for the public sector. He has extensive expertise in the financial administration of major capital infrastructure projects, as well as the development, compilation, and review of Long-Term Financial Plans. Peter leads PSD Citywide’s Financial Advisory team successfully supporting governments across the Country.

JUNE 2022 • DOLLARS & SENSE PERSPECTIVE | 9

Introducing the New Addition to the MFA Team

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ove working with local governments? Check. Eager to absorb hundreds of tidbits of information at once? Check. Excited about working with a phenomenal team who is passionate about supporting and developing close working relationships their clients?

Check. Joining the MFA in March of 2022 ticked so many boxes for me. As the newest member of the MFA team (aka rookie) I felt compelled to reach out to you all to introduce myself. Am I still feeling a bit stunned?

Check!

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As the Manager of Client Services, my primary focus is to help you. It’s as simple as that. Whether you need assistance with depositing funds into one of MFA’s Pooled High Interest Savings accounts, you wish to add a new employee’s signatory access to your account with us, or you want a detailed summary of MFA’s Pooled Investment Funds (and perhaps a scheduled presentation by one of our helpful and knowledgeable staff members), I am happy to assist.

And speaking of presentations, a significant part of MFA’s mandate is to support education in the public sector. We recognize that our role as educators is all the more important these days as we navigate market and interest rate volatility. We have been having frequent conversations with local government staff on this topic, as many are feeling unsure about the right “course of action” when reviewing and solidifying their organization’s investment strategies this year.

Our advice to you all: If you have a well-thoughtout plan, you should not be concerned about the daily interest rate environment. Stay the course. If you are currently invested in pooled bond funds, for example, hold on to what you own until at least the duration of the fund. If you have new money to invest, you must first consider your short- and long-term financial goals; any investments made should always be incorporated into a comprehensive long-term investment plan. From there, you can determine whether it is best to buy a single bond, a fixed-rate GIC, or investing in a pooled fund. What you choose should always be done in relation to your existing portfolio and overall goals and strategy. There is much more to an investment product than the yield it offers. With this approach, you will have the confidence to explain your strategy to anyone

who asks. If you feel your staff or council would like to hear from MFA staff on this topic, please do reach out to us. We are here to support you.

If we have not yet had an opportunity to connect through email or phone (or in person at the GFOABC conference in Penticton this year), my “door” is always open and I look forward to connecting with you in the future.

NICOLE GERVAIS is the Manager, Client Services with the Municipal Finance Authority of BC (MFA). She is responsible for managing the Client Service functions of the organization and supports a wide array of activities relating to borrowing, investing, and education.

Nicole has an extensive background in the financial services industry, having served over 18 years in various roles in commercial and retail banking, and currently sits on the Board of Directors for the Victoria Cool Aid Society.

JUNE 2022 • DOLLARS & SENSE PERSPECTIVE | 11

Is it Time to Term?

After an over two year pause in interest rate movements, the phones are starting to ring at the Bank again.

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f you haven’t revisited your investment strategy in a while, it’s certainly a good time to do so. The markets are waking up with the ongoing increase in interest rates. After a period of inversion, the interest rate curve is returning to something more familiar, and investors are talking about fixing.

Dusting off the laddered GIC spreadsheets is never as simple as it seems. When do you lock into fixed term rates, and how much? Well, that depends on a few important financial factors, starting with an evaluation of your current holdings. Being mindful of a few key factors can ensure you are getting the best rates possible on your investments, while supporting your operations effectively.

• Take note of the rate you are receiving on funds held in fully liquid Savings and Operating accounts.

• Review the duration of your investment instruments to ensure they align with any liquidity outlays. While local governments do invest a significant amount of effort into cash flow projections, forecasts can change.

Flexibility can be achieved by blending product types to maximize returns to ensure appropriate availability for unexpected events and to maintain day-to-day operations.

• The expected future rate environment should play a key role in determining investment duration as well.

Work to build optionality in your broader portfolio so that you can participate in any future rate upticks.

• Evaluate your strategy on a semi-annual basis or at least once per year. Sometimes this exercise is wellsuited after tax-collection season when you have

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higher cash holdings. A well-written investment strategy can be revisited to ensure your portfolio is performing with the changes in your local government plans, not to mention the markets.

In a conversation with Scotiabank’s Chief Economist, Jean-Francois Perrault, we asked him ‘Should clients be considering different alternatives to managing cash?’ His response, ‘We know that interest rates are set to increase substantially in the next few months. The rate environment will be very different from what has been experienced since the early days of the pandemic. Given that, treasurers should be calibrating their approach to asset and liability management to ensure they are well suited to the environment we are now in’.

Financial institutions have established cashable and redeemable GIC’s to ensure clients can invest with the peace of mind that they are getting the best returns with some built-in flexibility should situations change. Most banks will offer deposit specialist services to help you build out that strategy, and don’t hesitate to get a second opinion.

This article is provided for information purposes only. It is not to be relied upon as financial, or investment advice or guarantees about the future, nor should it be considered a recommendation to buy or sell.

JOANNE REBNER is a Senior Manager, Payments and Cash Management at Scotiabank. Joanne has consulted to corporate and commercial clients for 24 years in both her product and sales roles within the bank. For the past 14 years, Joanne has been working in B.C. specializing in coverage of Municipalities and Regional Districts. Joanne holds a Honours Degree, Business Administration. For more information, rates, products and services contact joanne.rebner@scotiabank.com.

Attend our PSAB Roundtable for Municipalities on Natural Resources and Sustainability The International Public Sector Accounting Standards Board (IPSASB) recently issued two consultation papers: Natural Resources Advancing Public Sector Sustainability Reporting.

SHARE YOUR VIEWS!

PSAB is hosting a roundtable discussion for municipalities to help inform its own response to these Consultation Papers – ensuring Canadian-specific perspectives are heard by PSAB and shared at the global level!

WHY SHOULD YOU ATTEND? > Meet with both PSAB and IPSASB staff representatives. > Hear from fellow Canadian municipalities on their feedback to IPSASB’s proposals. > Be part of PSAB’s response to the IPSASB – and therefore part of global decision-making on these important matters.

Date: August 17, 2022 Time: 10AM – 12PM PT (1 – 3PM ET) Location: Zoom REGISTER HERE IF YOU ARE INTERESTED IN ATTENDING. Note: this event will be held in English. If you prefer to engage with PSAB in French, please email the staff contacts below for alternate arrangements to be made.

EVENT STRUCTURE This roundtable discussion will provide an overview of the IPSASB’s proposals and give participants an opportunity to share their feedback. We also encourage participants to review the IPSASB’s materials below to help inform this discussion: IPSASB’s Natural Resources Consultation Paper and supporting materials IPSASB’s Consultation Paper on Advancing Public Sector Sustainability Reporting and supporting materials UNABLE TO ATTEND? In the event you are unable to join us on August 17th, please email Jean Goguen (jgoguen@psabcanada. ca) or Lauren Pennycook (lpennycook@psabcanada.ca) for alternate ways to obtain your feedback.

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Protecting Linear Infrastructure: Enhancing Community Resilience

by Reducing Protection Gaps

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ew Zealand and British Columbia have very similar earthquake exposures, particularly with our proximity to subduction interfaces. This article explores some of the lessons learned from the New Zealand earthquake experience and particularly the impact on linear infrastructure and explores opportunities for our communities to be better prepared, and more resilient, in the future.

Infrastructure, particularly the three-water infrastructure (drinking, waste and storm water), is not glamourous as it is usually buried underground and generally ignored, that is, until it stops working. The events in Christchurch caused widespread loss and damage to the three-water infrastructure networks and highlighted how reliant our communities are on these systems and how their importance is often underestimated.

The Christchurch earthquake struck on Tuesday 22 February 2011 at 12:51 p.m. The epicentre was near Lyttleton, close to Christchurch’s central business district. After approximately 10 seconds, 185 people had lost their lives, thousands of people were injured, and severe damage was caused to both buildings and infrastructure. A vibrant and dynamic city was dramatically altered. The Christchurch event (Mw 6.3) was an aftershock following the primary earthquake event, which occurred near Darfield on 4th September 2010 (Mw 7.1). Both earthquakes were part of the Canterbury Earthquake Sequence that comprised of 4 earthquakes >Mw6 and 11,000 aftershocks during 2010-11.

In 2012, Aon was asked if it could help local government in New Zealand with a risk transfer solution for their three-water and river management assets. This was challenging as the insurance sector has become more data-driven and often the sources of data or

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modeling tools available, are either unsuitable or need adaptation, especially for linear infrastructure which is considered by many as ‘uninsurable’.

Aon’s role has therefore been to bridge disciplines across both private and public sectors. A collaborative and systemic approach was needed, and we developed a solution that has continued to evolve and grow to the extent that Aon now provides this capability to 85% of local authorities across New Zealand.

Through the development process, Aon realized they had developed something far more useful than just a risk transfer option. The multi-disciplinary approach enabled a way to link the asset data and the science and engineering expertise into the financial and physical risk mitigation. The data-driven approach enabled Aon to unlock economic insurance for linear infrastructure, this alone reduces the protection gap for communities.

However, the combined approach also enhances risk governance and decision making including, for example, financial analysis, or cost benefits, that can be used to support physical adaptation projects. In summary, this approach enhances risk understanding, informs risk

A financial partner you can count on. strategy, and enables significant enhancement in a communities’ resilience to a natural disaster.

The Christchurch event has been a catalyst, it has enabled us to recognize many of the limitations of the past, such as the lack of data, inadequate analytics, and siloed approach. Through addressing these issues, Aon has developed a methodology to better protect linear infrastructure and the communities that rely on it.

SAM KETLEY is Head of Enterprise Risk Solutions for Aon New Zealand. In his role, Sam works with colleagues from across Aon to support Local and Central Governments, as well as corporate and commercial clients. Sam believes that through better understanding and quantification of risk; better solutions and strategies can be developed that enable clients to tolerate, treat and transfer risks more effectively. Sam has led the development and delivery of the risk transfer solution for 3-water and river management infrastructure assets that is now used by 85% of Local Government in NZ.

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Contact your Payments and Cash Management expert today.

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JUNE 2022 • DOLLARS & SENSE PERSPECTIVE | 15

Local Government Interests in Land – Property Taxes and Exemptions

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t is common knowledge that municipalities are exempt from taxation under the Community Charter in respect of lands they own in fee simple. But interestingly, the authority for this exemption under section 220(1) (b) of the Community Charter does not use the word “owned”. Instead, it exempts lands that are “vested in or held by” the municipality. What do these words mean?

What municipal property interests are covered? Could they include lands leased to a municipality? A case currently on reserve with the BC Court of Appeal (argued on October 21, 2021) may provide new direction.

In the BC Supreme Court reasons in Coquitlam (City) v. British Columbia (Assessor of Area #10 – North Fraser Region), 2020 BCSC 440, Mr. Justice Skolrood considered whether the City of Coquitlam should receive a tax exemption under s. 220(1)(b) of the Community Charter for lands it purchased pursuant to an agreement for sale (an “AFS”), on the basis that such lands were “held by or vested in” the City.

An AFS (which is distinct from the much more common agreement of purchase and sale) is essentially a vendor financing arrangement, where the purchaser pays the purchase price in installments and typically receives possession of the property at the time of first payment. The vendor remains registered in the land title office as owner of the property, while the AFS is registered as a charge in favour of the purchaser and can only be discharged via foreclosure proceedings following purchaser default under the AFS. On final payment of the purchase price, title to the property is conveyed to the purchaser.

In Coquitlam, the City had acquired lands under an AFS and was in the process of developing the lands as

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a public park. At the relevant time, the vendor’s name remained on title and the AFS was registered as a charge and gave the City possession and total control of the lands and the right to eventually become registered owner of the property.

The Assessor argued that the exemption at s. 220(1) (b) did not apply, as the lands were not “vested in or held by” the City, and therefore the lands were taxable. The Assessor asserted that the Court was bound by prior legal precedents, including a very complicated Supreme Court of Canada decision from 1944 where lands leased to the Crown were found to be taxable in the name of the private owner. On the basis of that case, the Assessor argued, both in the BC Supreme Court and the Court of Appeal, that even if the City did “hold” the lands pursuant to the AFS, the fact that the vendor’s name was on title made the lands taxable in any event.

The BC Supreme Court ultimately came down on the City’s side, finding that the City’s interest was strong enough to engage the exemption provisions in the Community Charter, fully exempting the lands despite the vendor’s name on title.

The Assessor appealed this decision and the Assessor and City now await the Court of Appeal’s decision.

While the facts on the ground may support the Supreme Court’s decision (the land was used as a park), the Court of Appeal will likely decide this case on the statutory wording and legal precedent. While it is unusual for a local government to purchase land under an AFS, it will be interesting to see whether the Court of Appeal’s decision has broader implications for the taxation of local government interests in land.

NICK FALZON joined Young Anderson as an associate in May of 2019, after completing both summer and full articles with the firm.

Originally from Victoria, he completed undergraduate studies at the University of Victoria, graduating with a Bachelor of Arts with Honours and Distinction in Greek and Roman Studies. In 2018, Nick graduated from the Schulich School of Law at Dalhousie University.

Nick maintains a general municipal practice, with a focus on litigation and administrative law.

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JUNE 2022 • DOLLARS & SENSE PERSPECTIVE | 17

New Vehicles for the Same Old Budget … or Less

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overnment entities – across British Columbia and nationwide – are putting intense pressure on their departments (public works, parks, fire service, and code enforcement, among others) to deliver first-rate community services with increasingly scarce resources. In turn, government leaders are being challenged to find creative ways to do more with less, while maintaining high standards of quality.

With aging vehicle fleets taking their toll, many local government agencies are learning that working with a professional fleet management company like Enterprise Fleet Management provides them with flexibility and control over their assets: they can not only improve the lifecycle of their vehicles but also reduce their total cost of ownership with no impact on their current budget.

As a result, government agencies can invest those cost savings in better serving the people who matter most: taxpayers.

FINANCES AND CASH FLOW It’s no secret that older, high-mileage vehicles can be more trouble than they’re worth. Older vehicles often end up being more expensive due to frequent maintenance and reduced fuel economy. Other hidden costs include administration, taxes, registration, depreciation, and insurance.

Many municipalities pay cash for light-duty vehicles out of their capital budget to own their fleet, which typically limits their ability to replace vehicles to a small percentage annually. This method often results in vehicles remaining in the fleet past their recommended replacement policies.

By working with a professional fleet management company, a municipality can replace more of its fleet on an annual basis while maximizing savings. Fleet

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management companies assess reliable forward-looking market data to help government agencies implement the mobility solutions that best meet their needs at the lowest cost to the taxpayer.

TECHNOLOGY AND INNOVATION Industry-leading cost control and reporting capabilities help customers reduce the total cost of ownership, while also improving productivity and providing updates on the latest industry trends.

For example, Enterprise Fleet Management offers telematics solutions that provide fleet operators a comprehensive view of the analytics of each vehicle and driver to help them track and evaluate: • Fuel management strategies • Scheduled and preventive maintenance and maintenance alerts • Driver performance, accident management, and crash avoidance • Employee productivity • Data for regulatory compliance VEHICLE RESALE Resale expertise is an important (and often overlooked) element of reducing fleet expenses. The vehicle replacement process is particularly important for government entities as they have a variety of vehicle types and usages.

A fleet management company with remarketing expertise can help maximize vehicle resale value with a rapid sale process and optimal exposure through multiple channels. As a result, government entities can focus on more important assignments and allow the fleet experts to put equity back into their investment.

CUSTOMIZED APPROACH All budgets and fleet needs are different. It’s essential to partner with a company like Enterprise Fleet Management that can provide a customized solution for your agency’s needs. You just might find that you have more control over your fleet costs than you thought – without sacrificing quality or flexibility.

TIMOTHY M MCCORMICK is a Director for Enterprise Fleet Management in British Columbia. Owned by the Taylor family of St. Louis, Enterprise Fleet Management operates a network of more than 50 fully staffed offices and manages a fleet of more than 649,000 vehicles in the U.S. and Canada. The business provides full-service management for companies, government agencies, and organizations operating medium-sized fleets of 20 or more vehicles.

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JUNE 2022 • DOLLARS & SENSE PERSPECTIVE | 19

Strategies for Getting Council to Understand and Support Your Budget

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t’s budget time, and you’re ready! Painstaking detail and effort have gone into making sure that all 300+ pages of the budget book have been checked and rechecked. While this may feel like a job well done, the hard part (communicating) is just beginning.

The reality is that a budget without context is just as ineffective as a map without a legend. The presentation of the budget’s information is your chance to help Council, the Board, or any other stakeholders map out where your organization is today and its future direction (remember the map)!

With lots of information to share in a limited time, effective communication is essential. Therefore, when developing your strategy, you should consider the objectives of:

Progressive disclosure keeps information at the summary level until the reader asks for or needs more detail. Providing too much information at once is overwhelming, causing that glazed-over-eyes phenomenon we have all seen!

Using a drill-down approach provides additional information as necessary when the readers are ready to make sense of it. > Style for understanding When it comes to style, remember that beauty is in the eye of the beholder. Thus, the focus should not be on what looks pretty but on understandability. To convey the message, consideration should be given to using the right combination of text, tables, and graphs.

1. Informing, and 2. Engaging.

Informing is the starting point for communication and is based on the following: > Information flow is in one direction Reading a budget book is an example of the one-way flow of information. The reader receives the information. However, without any accompanying conversation, they do not have the opportunity to ask questions or give feedback.

But just providing the information is not enough.

Communicating with the goal to enable understanding helps Council focus on and interpret the data so that the intended messages are received.

Simple strategies for improving comprehension include using: > Progressive disclosure to keep things focused

Engaging provides Council with the opportunity to receive information as well as respond with questions.

The benefits of this multi-directional approach become apparent as heads begin nodding with understanding instead of the usual nodding off.

Tools such as real time-modeling can make things even more dynamic. If a picture is worth a thousand words, a simulation is worth at least a million.

Simulations can help demonstrate individual budget components, their relationship with other areas, and the impacts of making changes that are often hard to articulate.

Specifically, a simulation can: > Demonstrate the inherent trade-offs that come with competing resources and desires > Highlight the differences between discretionary and non-discretionary items and how they impact the budget > Show both the short- and long-term impacts of budgetary changes

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“Learning efficiency benefits greatly from the use of progressive disclosure. Information presented to a person who is not interested or ready to process it is effectively noise. Information that is gradually or progressively disclosed to a learner as they need or request it is better processed and perceived as more relevant.”

— Universal Principles of Design, Lidwell, Holden, Butler SHIFTING YOUR ROLE: It is no secret that finance, and budget departments’ resources are limited, and much of those resources are already allocated to just preparing the budget. This begs the question of how to implement these strategies? The answer: Best Practices paired with the appropriate Technologies.

There are various software solutions that can free up staff resources by: > Soliciting community engagement and integrating it into the budget > Automating the preparation of the budget publication > Assisting with a real-time, interactive presentation Budget simulators are one such tool you can consider.

Using technology to reduce the more manual and mechanical processes, you can shift staff resources to focus on better communication and engagement. This allows finance departments to add value as not just number crunchers but as trusted advisors.

JOY RICHARDSON, CPA, is a Principal Consultant at F.H. Black & Company Incorporated and a GFOA Distinguished Budget Presentation Award Reviewer. Joy’s extensive experience as an auditor, a local government finance officer, and a governmental software consultant makes her the ideal person to assist clients with their complex financial reports.

JUNE 2022 • DOLLARS & SENSE PERSPECTIVE | 21

c o l le c t o r s ’ c o r n e r 2022 GFOABC Conference - Collectors’ Forum Session

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his year the 2022 annual GFOABC Conference was held in-person in Penticton. Over 38 finance officers attended the Collectors’ Forum session in person and an additional 41 attended virtually. Doug Stein, GFOABC facilitator, hosted the session. The guest speakers were Michael Quattrocchi and Nick Falzon from Young Anderson and Joshua Craig from the Ministry of Municipal Affairs.

Michael Quattrocchi and Nick Falzon presented on the theme “Local Government Interests in Land – Property Tax and Exemptions”.

They reviewed the court case in which the City of Coquitlam purchased land by means of an agreement for sale and the question was whether the parcel should be exempt from property taxes pursuant to the Community Charter S220(1)(b). After following the case all the way to the BC Court of Appeal it was decided that even though Coquitlam has an “interest in land”, the land is taxable in the name of the vendor. Mike and Nick also discussed the tax sale court case involving Spallmucheen in which the court ruled that Spallmucheen erred in not notifying the owner pursuant to the Local Government Act

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S657. An interesting point on this case was that the court ruled that not only should the owner be paid the market value of the property, but also that the market value be determined as at the date of the court decision as opposed to the date that the redemption period ended.

On the same subject, Joshua Craig from the Ministry of Municipal Affairs discussed the recommendations from the Ombudsperson to the Ministry of Municipal Affairs regarding the tax sale process to ensure that property taxes are collected fairly, especially with regards to vulnerable taxpayers. The Ministry agrees with the five recommendations and is preparing responses.

Joshua expressed appreciation for the comments that came from the collectors. GFOABC is pleased to assist with reporting out the responses to municipalities. Joshua also reported on the document “Capital Grant (Conditional) Projects: Budget Forecast Reporting”, such as the importance of accurate and timely reporting, critical timelines and tips/reminders. Joshua concluded by referring to the UBCM/ Ministry of Municipal Affairs new Memorandum of Agreement with regards reviewing local government

finance as recommended in the UBCM’s report “Ensuring Local Government Financial Resiliency”.

During Round Table, the collectors discussed additional tax sale questions, the new amendment to the Community Charter S94 regarding public notice, and the City of Victoria’s new initiative “Reconciliation Contribution Fund” that was rolled out with this year’s property tax notice mailing.

Thank you to GFOA for sponsoring the Collectors’ Form session at the Conference and the quarterly Collectors’ Forum webinar. The next Collectors’ Forum webinar will be July 27th.

DOUG STEIN has worked in municipal finance for over 30 years. In 2011 he retired from his position as Manager of Revenue Services for the District of Saanich. Doug leads the Collectors’ Forum, is a GFOABC Life Member, and a CPA, CMA.

CIVICINFOBC CIVICINFOBC

q u a rte r ly q u estio n

Local Government Policing

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or this issues’ Quarterly Question, we asked local governments about their local government’s policing.

Out of 161 local governments in BC, 80 have a population under 5,000 and therefore do not have to contribute to policing costs. Of the remaining 81 municipalities, 11 have a municipal police force, leaving 70 with RCMP services that they must pay between 70-90% of the costs.

The RCMP ratified a collective agreement with the federal government in August 2021 for a new 6-year period expiring in 2023, which has forced an increased cost on our BC local governments. In our March issue we asked members how this increase impacted budget.

How has spending on policing changed in 5 years from 2017 to 2022: Local Governments with a population of 5,000 to 14,999 are required to contribute 70% toward RCMP policing costs. The response for this question included 50% of local governments in this group. These local governments reported that between 2017 and 2022, spending increased on average 38%, with a median increase reported at 30%. The reported increase in their overall municipal budgets was 3.35% on average due to policing cost increases.

Local Governments with a population of 15,000 or more, must contribute 90% towards paying RCMP officers. We had a response rate of 32% from local governments in this group, who reported that spending between 2017 and 2022 increased on average 28%, with a median increase reported at 26%. The reported increase in overall municipal budgets was 0.59% on average due to policing costs.

We had 5 of 11 local governments with Municipal Police Forces respond to this question, with 4 out of 5 reporting their collective agreements had expired causing uncertainty of future expenditures.

Detailed results for this survey can be obtained by emailing surveys@civicinfo.bc.ca (Continued next page)

JUNE 2022 • DOLLARS & SENSE PERSPECTIVE | 23

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quarterly question THE NEXT QUARTERLY QUESTION: HOW DO LOCA L GOVERNMENTS MANAGE DELINQUENT TAXES AND PROPERTIES SUBJECT TO TAX SA LE APLEASE USE THIS LINK TO BE A PART OF THE RESULTS OF THE NEXT QUARTERLY QUESTION. YOUR PEERS WILL THANK YOU! The survey should only take about 3–5 minutes to complete. The responses to this question will be profiled in the next GFOABC Newsletter.

If you have a topic for a future quarterly question, please contact the office at office@gfoabc.ca or (250) 382-6871

If you would like to learn more about this free service, contact CivicInfoBC at info@civicinfo.bc.ca

NEXT NEWSLETTER PUBLICATION IS SEPTEMBER Please contact us if you would like to submit an article or suggest a newsletter topic. office@gfoabc.ca • (250) 382-6871 24 | GFOABC.CA

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