Updating Langley City's Financial Plans and Improvement Projects

Yesterday, I posted about Langley City's 2023 audit financial statement and that we received a clean bill of financial health. Today, I am highlighting amendments to our 2023-27 Financial Plan and 2024-28 Financial Plan.

As part of basic housekeeping, once we've received our 2023 audit financials, we need to update the 2023-27 Financial Plan and Capital Projects and Improvements Plan to reflect those financial results. Council gave first, second, and third reads to approve this update in principle.

As we move through the year, the City and Council's priorities for improvements and projects change. We can also receive funding for projects from the federal government, the province, TransLink, ICBC, and others. These changes mean that Council must approve amendments to the plan throughout the year. On Monday, Langley City Council gave the first, second, and third readings to approve the following changes in principle.

• Langley Bypass Roadway and Cycling Improvements - Received additional funding from TransLink.
• 200 St Culvert Upgrade at Brydon Crescent - Received additional funding from TransLink.
• Major Road Network Rehabilitation - Received additional funding from TransLink.
• SkyTrain Multi-Use Path - Received $4 million from the province to create a walking/bike path along the entire SkyTrain route in Langley City.
• Building a Safer Langley - Received additional funds from the federal government.
• Local Government Climate Action Program - Received additional funds from the province.
• Road Rehabilitation - Received additional funds from the federal government.
• Demolition of Buildings Adjacent to City Hall / Timms Centre - Reallocated funds from City reserves.
• Fire Hall Exterior Building Envelope Repair - Reallocated funds from City reserves.
• Fire Ladder Truck Replacement - Reallocated funds from City reserves.
• Fire Department Thermal Image Camera - Reallocated funds from City reserves.
• City Park Baseball Diamonds Upgrade - Reallocated funds from City reserves.
• Miscellaneous Property Purchase - Reallocated funds from City reserves.
• 208 Street Water Service Repair - Reallocated funds from City reserves.
• Sewer and Drainage Replacements - Reallocated funds from City reserves
• Water and Sewer Hydraulic Modelling Software - Reallocated funds from City reserves.
• Township of Langley Imposed RCMP De-integration Study - Reallocated funds from City reserves.
• RCMP City Detachment - Reallocated funds from City reserves.
• City-Wide Parking Study - Reallocated funds from City reserves.
• Douglas Crescent & 203 St Intersection Safety Improvements - Reallocated funds from City reserves.
• Fraser Highway, 201A St to 203 St Water Main Replacement - Reduced Budget
• 46 Ave, 196 St to 200 St Repaving - Deferred project to free up funding
• Mayor Roads, Left Turn Lanes - Deferred project to free up funding
• Fire Hall HVAC Renewal - Deferred project to free up funding
• Park Equipment – Chipper & Trailer - Deferred project to free up funding
• Rail Notification System - Deferred project to free up funding

You can view the entire document of changes on Langley City's website.

Langley City's 2023 Consolidated Financial Statements Pass Audit

Langley City must have its financials audited annually. The audit forms part of the City's Annual Report, which Council releases in the summer. Langley City's independent auditor, Kristine Simpson, from BDO Vancouver, gave our 2023 Consolidated Financial Statements a clean bill of health.

In 2023, Langley City had about $59.4 million in expenses. Due to increased usage, the City had a small $212,372 operating deficit for water service. This deficit was caused by the timing of the Metro Vancouver Regional District's billing cycle compared to the City's water billing cycle. This deficit will be corrected when people pay their 2024 water utility charges.

Other departments had an overall surplus. Any surplus is put into reserve accounts to help fund capital projects, such as repaving roads or enhancing parks. The City transferred $3.9 million in operating surplus to reserve accounts in 2023. The biggest driver for the 2023 surplus was about $762,000 in unneed debt service charges, as we are still working through the $15 million loan authorization process. The debt service charge is baked into our tax rate. RCMP detachment operations were also under budget, creating a $567,00 surplus.

The remaining surplus is primarily due to underspending on staffing. This surplus is due to temporary staff vacancies, unused overtime allocations, new positions hired part-way through the year, and unfilled positions.

The City's goal is to have a balanced budget, but we cannot have a structural deficit under BC law. This requirement means that the City must budget conservatively, which generally means we will have a small surplus at the end of the fiscal year.

This year, we had a larger surplus for reasons I previously noted. One of Council's action items is to ensure that we have a plan for filling these positions. Council also asked staff to develop a budget surplus policy to formalize what we do with budget surpluses. City staff will present this policy to the Council for consideration this summer.

For more information, please read the City's report on the 2023 Consolidated Financial Statements.

Fraser Highway Road Renewal and Water Main Replacement Project Approved (Between 201A and 203)

Last night, Langley City Council issued a tender for replacing the water mains under Fraser Highway Between 201A Street and 203rd Street and repaving the road. This total project is $2.8 million. Richco Contracting Ltd. is the contractor for the project for a cost of $2.1 million. ISL Engineering and Land Services Ltd. is the contract administrator for $71,160.00. The contract administrator ensures that the contractor stays on course and on time. The remaining project cost is reserved for contingency and will be returned to the City's reserves if those funds are not needed.

There are many active road projects in and around our Downtown area. As you have seen in our last two budgets, Langley City Council is committed to working on the basics: water, sewer, and roads. You are seeing the results of these Council decisions in action. Construction is disruptive, but the results will be better roads and the continued safe delivery of water and sewer services.

City staff and Council know that SkyTrain construction will start soon. We've priority work in our Downtown area, west of 204th Street, to ensure we are not conflicting with the major construction of SkyTrain through our community.

Who Took My Property Tax in 2023

Langley City Council is reviewing our 2023 Consolidated Financial Statements at tonight's public meeting. One of the questions I frequently get is why the tax bill is higher than what I talk about when Council reviews and ultimately approves a budget and property tax rate.

The primary reason is that only about 58% of property tax collected is controlled by and goes to Langley City. The rest goes to other governments and organizations that set their property tax rate.

The following interactive chart shows who got what slice of property tax in 2023.

There are a few caveats. First, the Downtown Langley Merchants tax is only charged to commercial properties in our Downtown. Also, the Municipal Finance Authority collects about $4,000 in property tax, which is too small to show on the chart.

Finally, most property tax bills include water, sewer, and garbage fees. These aren't property taxes. In 2023, Langley City collected $17.8 million in fees.