Following all-day preliminary 2021 budget deliberations on Dec. 10, Kelowna City Council has approved a preliminary 4.04 per cent overall taxation demand increase.
A 4.04 per cent increase means an $85 increase or approximately $7 per month, for the City portion on an average single-detached home tax bill in Kelowna. The final tax demand increase will be set in April 2021, following final review of requests by City Council.
Check out this high-level overview of the preliminary budget. For more details, read the complete 2021 Financial Plan below.
Watch the video below to learn more about our budget process, what type of items get included in a municipal budget and how we pay for things. (Note: the video was produced in 2019 for the 2020 Budget and some of the imagery and content do not reflect the current COVID-19 landscape.) Explore the following sections on this page for more budget-related information:
The City has been awarded the Government Finance Officers Association Distinguished Budget Presentation Award 18 years in a row. The award program was established to encourage and assist local governments to prepare budget documents of the very highest quality.
Inside the 2021 Budget
Despite the economic challenges and circumstances we face from the fall-out of the global pandemic, our strong financial management and clear budgeting practices continue to allow us to deliver the essential services residents expect of us and maintain, expand and build infrastructure that makes Kelowna a great place to live. The annual budget includes capital requests (infrastructure) and operating requests (programs, services and support).
Following all-day preliminary 2021 budget deliberations on Dec. 10, Kelowna City Council approved a preliminary 4.04 per cent overall taxation demand increase.
A 4.04 per cent increase means an $85 increase, or approximately $7 per month, for the City portion on an average single-detached home tax bill in Kelowna. City taxes are only one portion of a property tax bill, which also includes other amounts the City collects on behalf of the Province, the Regional District, school and library levies.
The taxation impact in the 2021 budget is $157.6 million, which is an $8.7 million increase over last year. The anticipated $2.7 million in new construction revenue directly offsets taxation, as such, the net taxation increase impact ends up being $154.9 million, or a 4.04 per cent increase. Overall, taxation accounts for 40 per cent of the needed revenue for 2021. The City received $7.88 million in emergency funding through the BC Safe Restart Program and has put 32 per cent ($2.5 million) to work to mitigate 2020 pandemic impacts with the balance being used to address some revenue shortfalls and emergency planning and response for 2021.
Maintaining essential services and renewing existing assets represents the largest capital budget investment for 2021 at $33.4 million. This includes road resurfacing ($4.4 million), renewal of wastewater mains and facilities ($3.7 million), along with numerous park and facility improvements (Knox Mountain Park and City Park, City Hall, Downtown Parkades, Rutland Arena).
This year’s budget prioritizes public safety by bolstering our resources with 14 safety positions which, annualized in 2022, make for a $1.9 million investment. The 2021 safety positions include eight RCMP members and six civilian support staff. Community safety represents the largest net operating budget investment for 2021 at $43.6 million.
Parks, animated spaces and recreation opportunities make for vibrant and healthy neighbourhoods. In 2021, $12.7 million is being invested in parks acquisition, development and improvements for parks such as Pandosy Waterfront Park, Kerry Park, Tower Ranch Park, and others.
In addition to investments in essential services, safety and vibrant neighbourhoods, the 2021 budget includes:
- Investing almost $600,000 to support programs and initiatives to help address complex social issues so we can build on being a socially responsible and inclusive community. This includes extending support for the Journey Home Strategy to 2023, funding to review housing for those with complex needs and support for temporary outdoor sheltering sites.
- Taking action to address the impacts of climate change and protect our environment with almost $3 million to support Mill Creek flood protection efforts, introduce low-carbon initiatives, energy retrofits, establish GHG (greenhouse gas) modelling and hire a an environmental leader to review current policies and make recommendations to bolster current efforts.
- $1.9 million in new transportation capital expenditures to ensure our growing community can get around safely and have access to different transportation options. We will connect the Okanagan Rail Trail to Waterfront Park and expand active transportation corridors and bicycle networks.
City staff had proposed a 4.27 per cent overall taxation increase for Council’s consideration at the Dec. 10 public meeting. Council sets the preliminary tax increase requirement after reviewing which projects to fund, and which projects to defer or cancel. Carryover requests will be presented to Council in March and the final tax demand increase will be decided by Council in April 2021.
For more information on 2021 budget documents, check back in December for news releases, budget volume and infographics.
News releases, factsheets & infographics
- Budget Connect factsheet (at Dec. 10 with Preliminary Budget approved)
- Dec. 10 News Release: Preliminary budget approved with 4.04% increase
- Budget Connect factsheet (at Preliminary Budget as of Dec. 3)
- Dec. 3 News release: Read the Preliminary 2021 budget online
Reports to Council
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Kelowna is a vibrant, growing city where your tax dollars help create an active, inclusive and safe community, strong economy, clean and healthy environment, and resilient, well-managed infrastructure. It has become a place where 92 per cent of residents say their quality of life in Kelowna is good or very good and 79 per cent say they receive good value for their taxes (2020 Citizen Survey).
Your municipal tax dollars pay for a wide variety of projects and services, from Police and Fire services to parks upgrades and maintenance, transportation and transit to active living and cultural services:
- 31% Safety
- 15% Fire
- 13% Parks, beaches & trails
- 10% Transportation (roads, sidewalks, etc.)
- 7% Transit & regional services
- 5% Planning & development
- 5% Building services
- 5% Active living & cultural services
- 3% Debt
- 2% Grants
- 2% Utility services
- 2% Street lights
From the Final 2020 Financial Plan (May 2020), based on the 2020 average single family detached property valued at $676,100.
Over the last five years, on average, a quarter of the City's funding has come from property taxes. The majority (75 per cent) of City funding comes from other sources such as reserves & surplus, fees & charges and borrowing.
Learn more about the City's budget by watching this video:
- 40% Taxation
- 29% Fees and charges
- 16% Reserves & surplus
- 5% Grants
- 3% Other revenue
- 3% Interdepartmental transfers
- 3% General revenue
- 1% Parcel taxes
From the 2021 Financial Plan
Every year presents its own budget challenges and difficult decisions, and the City’s annual budget aims for a balance between setting a reasonable tax rate and delivering services expected by residents and businesses.
Kelowna is one of the most fiscally responsible mid-sized cities in Canada, raising approximately three quarter of revenues from sources other than taxation. In our 2020 Citizen Survey, we heard that 79 per cent of residents say they receive very/fairly good value for their municipal tax dollars, and 91 per cent continue to say they’re satisfied with the overall quality of services provided by the City.
The City of Kelowna raises revenues through:
- The City's largest fund that covers all municipal operations (aside from the utilities and airport funds)
- Not allowed to operate at a deficit
- Operates the water utility within specific areas of the City not served by water districts
- Revenues within this fund, or prior years’ surplus, must be sufficient to cover all operating and capital costs of this utility on an annual basis
- Carries out the capital construction, operation and maintenance of wastewater treatment including sewer mains, lift stations and treatment facilities
- Revenues generated in this fund, or prior years’ surplus, must be sufficient to offset all operating and capital costs of this utility on an annual basis
- Operates the Kelowna International Airport
- Responsible for capital construction and ongoing administration, operation and maintenance
- This fund is required to be self-sufficient so that revenues generated must offset all operating and capital expenditures
Land sales reserve fund
- Sales proceeds from all properties disposed of by the City are required to be placed in this reserve fund
- Council may, by bylaw, use this fund to purchase land for general municipal or utility purposes
Parking reserve fund
- Provide funds to purchase land for parking lots, develop on-street parking and to construct parking lots or parkade
- The General Fund appropriates net revenues from the operations of parking lots, parkades and parking meters to the Parking Reserve Fund
Capital works, machinery and equipment reserve fund
- Provide funds for such items as the purchase of replacement equipment, retirement of capital debt and replacement of cemetery property
- Revenue for this reserve is provided from various sources within the General and Utilities funds
- We also maintain reserves for future expenditures. In the financial plan, the use of these reserves for future expenditures is shown under Accumulated Surplus for either revenues or expenditures.
Deferred development cost charges
- Collected to provide funding for required expansion of roads, drainage works, water works, sewer works, parkland acquisition and wastewater treatment facilities resulting from new development
- Funds collected may only be used for the specific purpose and in the specific area for which they were collected
Maintenance of adequate levels of reserves and surplus continues to play a significant role in achieving a level of financial stability for Kelowna taxpayers. The City maintains Reserve Funds and General Reserves in order to protect the current and future financial viability of the municipality. Reserve funds are statutory reserves that represent funds that have been put aside, or reserved, for specific purposes. General reserves are reserves that may be used for future operating or capital expenditures.
Reserves are regularly used to ensure that existing City equipment and infrastructure can be maintained and to ensure that unusual or unforeseen operating conditions can be met without the need for extraordinary tax increases.
The Ministry of Community & Rural Development provides infrastructure funding to local governments through a variety of grant programs. In 2009 and 2010, the City benefited from economic stimulus funding from provincial and federal governments under Canada's Economic Action Plan. Program funds have been fully allocated from this program.
Other revenue sources
Public/Private Sector Partnerships
To provide the services its residents want, Kelowna has nurtured many partnerships with individuals, community groups and private-sector companies. The City of Kelowna has an award-winning, economically-innovative team of professionals who have launched a number of differing partnering projects to help provide community facilities, programs and services without increasing general taxation.
Major recreational/cultural facilities are budgeted with substantial emphasis on funding from public/private sector partnerships (P3). P3s are effective tools to cost-effective service delivery structures.
The City entered into a public/private partnership for:
- Prospera Place
- Capital News Centre
The Kelowna Family Y is an example of a public/not-profit partnership.
Municipal Finance Authority
The City of Kelowna benefits from access to capital financing from the Municipal Finance Authority of BC. With triple-A credit ratings, the Authority has the ability to attract capital investments and make funds available to local governments at interest rates that are the lowest in Canada for municipal issuers. Since the Authority's credit rating exceeds those of chartered banks, its rates of borrowing are below those offered by these banks.
The City has accessed low-rate loans to fund:
Creating the budget
Every year City Council, the City Manager and City staff work together to develop an annual budget. The budget serves as an outline for how money that comes into the City should be spent to maintain and improve the city.
As the City is limited by the amount of resources available, the budget helps in determining which objectives have the highest priority and will produce the greatest positive impact in the community.
The budget process, and the decisions that must be made on how to best lead the development of a safe, vibrant and sustainable city, are supported by the following plans:
Sept 10, 2020
Establish City priorities for the 2021 budget year, based on discussion with Council and City Manager
Oct. 15, 2020
City Manager meets with each department to review and prioritise capital requests, supplements and expenditure reductions
Dec. 7, 2020
Council receives overview presentation of the 2021 budget
Dec. 10, 2020
Council reviews and adopts of the 2021 preliminary budget
March 22, 2021
Council reviews and adopts carryover projects from 2020
April 26, 2021
Council reviews and adopts final budget requests, property tax rates and 5-year Financial Plan
On Aug. 24, 2015, City Council adopted principles and strategies for financial strength and stability. The City defines financial strength and stability as “the ability to acquire and manage a portfolio of financial and physical assets that meet the current and future needs of our community.”
This is the goal. The adopted principles and strategies will guide decision-making within the City and help to realize this goal and, ultimately, the vision for Kelowna. Check out the principles and strategies below or read the review the Principles and Strategies for Financial Strength and Stability Financial document or summary one-pager.
The five financial principles are:
These principles serve as a basis against which the financial strategies that are outlined in the documents can be tested, reviewed and updated as needed.
The 10 financial strategies that are used to meet our financial goals are:
- Assets – New
- Assets – Renew
- Development Financing
- Partnerships & Enterprise
- Property Taxation
- Reserves & Surplus Funds
- User Fees & Charges
Each year, we build a budget that balances setting a reasonable tax rate and delivering services expected by residents and businesses. Take a look inside previous years' budgets and read past Financial Plans.
The COVID-19 pandemic has created complex challenges for families, businesses and many other organizations in the community, including the City. The 2020 Financial Plan is one of several financial strategies being used by the City to help manage the impact of this pandemic. Through the final budget, we have re-aligned the 2020 Financial Plan to reduce the taxation demand to accommodate a significant loss of revenues, while still maintaining essential services and continued investment in important projects.
The 2020 final adjustments result in a tax decrease of 2.1 per cent from the Provisional Budget tax requirement of 4.15 per cent. A 2.05 per cent increase means an $43 increase, or $3.58 per month, for the City portion on an average single-detached home tax bill in Kelowna.
- Improvements to public safety with $1.4 million in resources investments to start making a difference. These include the addition of 11 new RCMP officers and 14 civilian support staff.
- Building vibrant neighbourhoods by advancing park developments with a $22.3 million investment for parks acquisition, development and improvements. This includes funding from the new Parks Development Cost Charges program, which will see the acceleration of park developments residents have been anticipating, such as the Phase 1 of the Pandosy Waterfront Park.
- Bolstering economic resiliency by planning for a better Kelowna International Airport with the budget’s largest investment request: $67.3 million. The Airport plays an important role in our city and regional economy. As YLW is self-funded through user fees and charges, it has no taxation impact.
- Ensuring a socially responsible and inclusive community by investing to support programs and initiatives to continue to help address complex social issues. This includes $200,000 in funding to review housing for those with complex needs and for exploring optimization solutions of shelter services locations.
- Improving transportation alternatives with $11 million in transportation projects planned for 2020: the Lakeshore Road bridge over Bellevue Creek will be rehabilitated, the Ethel Street Active Transportation Corridor (ATC) will be extended to Raymer Road and construction of the Houghton ATC in Rutland will commence. Our $3.7 million annual road resurfacing program is also included.
- Demonstrating our commitment to environmental protection. We need to be proactive against the impacts of climate change. The budget includes $2.8 million in storm drainage upgrades and improvements and the addition of eight new electric vehicle charging stations downtown.
For more information, review the 2020 Financial Plan that includes Council's changes to Provisional - volume 1 on Dec. 12, 2019, and the Carryover - volume 2 document reviewed and adopted by Council on March 23, 2020. Final budget was presented to Council for review/adoption on May 4, 2020.
2020 Financial Plan summary ($ thousands)
|Actual 2018||Revised 2019||Final 2020|
|Net operating budget||133,677||139,922||150,476|
|New construction tax revenue||(2,600)||(3,570)||(3,400)|
|Net property owner impact||2.99%||4.10%||2.05%|
Kelowna City Council approved the final 2019 Financial Plan on April 29, 2019. An overall tax demand increase of 4.1 per cent was set, which includes revising the infrastructure levy to 2.27 per cent and 1.83 per cent for the municipal tax demand.
The combined 4.1 per cent increase means the owner of a single-family home with an average assessed value of $684,450 in Kelowna will pay $2,072 in municipal taxes, an annual increase of $81.49 (or $6.79 per month or $1.56 a week).
Twenty-one new budget requests are included in final budget for emergent issues and to address demonstrated needs in the community.
“New construction revenue netted out higher than initially estimated last December which enabled the reduction of the total taxation demand by 0.33 per cent from what Council initially approved at Provisional budget,” said George King, Financial Planning Manager. “This allowed us to look at ways to adjust the financial plan so that more could be contributed to offset our infrastructure deficit for the long-term sustainability and growth of our city, while still providing good value to residents for their tax dollars.”
In addition to urgently needed repairs such as the ramp heaters at Chapman Parkade and dredging at the Cook Road boat launch, Final Budget items also reflect ongoing commitments to addressing social issues and crime: two top-of-mind issues for citizens as noted in the most recent Citizen Survey.
Investments in safety include the addition of an RCMP officer to participate in the Kelowna Outreach and Support Table, bringing the total new officers added in 2019 to seven. Increased street lighting in the Agassiz Road area and more security services at City facilities, parks and public spaces will also be added.
A commitment to develop a social policy framework and to pilot a Lived Experience Peer Employment program will continue to help address the complexities of social issues. These build on earlier commitments made at Provisional Budget including land acquisition funding for affordable housing partnership opportunities.
The City’s net 2019 operating budget is $142.5 million. General municipal taxation accounts for 24 per cent of the City’s total revenue. In the most recent 2018 Citizen Survey, 79 per cent of residents said they receive good value for their taxes. As a financially resourceful municipality, the City’s other revenue sources includes grants, reserves and user fees.
Council sets the taxation requirement after reviewing the Financial Plan to determine which projects to fund and which projects to defer or cancel, balancing the community’s interest in maintaining existing levels of services while planning for significant infrastructure needs.
For 17 years, the City has received the annual Distinguished Budget Presentation Award, and most recently for the 2018 Budget. Presented by the Government Finance Officers Association, the award recognizes the City’s achievement in meeting the highest principles of governmental budgeting.
Residents will receive their property tax notices in late May. The bill also includes amounts for other taxing authorities, including the Province, the Regional District and the Library.
For more information, review the 2019 Financial Plan that includes Council's changes to Provisional - volume 1 on Dec. 13, 2018, and the Carryover - volume 2 document reviewed and adopted by Council on March 18, 2019. Final budget was presented to Council for review/adoption on April 29, 2019.
2019 Financial Plan summary
|Actual 2017||Revised 2018||Final 2019|
|Net operating budget||125,344,687||133,223,025||135,496,687|
|New construction tax revenue||(2,600,000)||(2,600,000)||(3,570,000)|
|Net property owner impact||3.84%||2.99%||4.10%|
Kelowna City Council approved the final 2018 Financial Plan, with a municipal tax increase of 2.99 per cent – the lowest it has been since 2014.
“It’s not uncommon for there to be a change from provisional to final budget,” says Financial Planning Manager George King. “Our role is to manage finances to ensure residents continue to enjoy City services they have come to expect, receive value for their tax dollars and that we continue to protect our infrastructure. The 2018 budget delivers just that, while reducing the tax rate from what was anticipated back in December.”
The 0.61 per cent reduction since Provisional Budget in December is a result of debt interest rate resets and increased revenue from the FortisBC Gas Franchise Fee and City investments. The reduction has been partially offset by nine additional items Council approved on Monday.
The 2018 Budget prioritizes safety, with a total of 20 frontline safety personnel being added this year – this includes four bylaw officers added at Final Budget for ongoing safety in the downtown area. At Council’s direction, Final Budget also includes the development of Phase 3 of Rutland Centennial Park to expand the playground, infrastructure and irrigation for the park.
Through strong financial management, taxation for the City of Kelowna’s 2018 Budget accounts for 26 per cent of the City’s total revenue needed to deliver services to residents. Other revenue sources come from grants, reserve funds and fees and charges.
Council sets the tax rate requirement after reviewing the Financial Plan to determine which projects to fund and which projects to defer or cancel, balancing the community’s interest in maintaining existing levels of services while planning for significant infrastructure needs.
For 17 years, the City has received the annual Distinguished Budget Presentation Award, and most recently for the 2018 Budget. Presented by the Government Finance Officers Association, the award recognizes the City’s achievement in meeting the highest principles of governmental budgeting.
For more information, review the 2018 Financial Plan that includes Council's changes to Provisional - Volume 1 on Dec. 14, 2017, and the Carryover - volume 2 document reviewed and adopted by Council on March 19, 2018. Final budget was presented to Council for review/adoption on April 30, 2018.
2018 Financial Plan summary
|Actual 2016||Revised 2017||Final 2018|
|Net operating budget||120,106,984||127,044,820||133,223,025|
|New construction tax revenue||(1,667,000)||(2,600,000)||(2,600,000)|
|Net property owner impact||4.11%||3.84%||2.99%|
Every year presents its unique budget challenges and difficult decisions. The 2017 budget is about supporting core City services affected by population growth, finding innovative ways to reduce costs and constantly improving City services.
During the City Manager’s preliminary budget meeting with Council in September, three priorities emerged and the 2017 budget will reflect City investment in:
Areas that are directly impacted by growth (e.g. development, homelessness)
Processes that improve how we work and save us real money (e.g. cost savings from new energy technologies)
Projects that improve the services we provide (e.g. enhancing online service)
This year’s proposed 3.84 per cent taxation increase is necessary to meet previous years’ commitments and provide the resources or funding needed to keep up with our growing population, including our homeless population.
For more information, review the 2017 Financial Plan that includes Council's changes to Provisional - volume 1 on Dec. 15, 2016, and the Carryover - volume 2 document reviewed and adopted by Council on March 13, 2017. Final budget was presented to Council for review/adoption on May 1, 2017.
Meeting the needs of a growing city
As an innovative City, we’re agile enough to adapt when new and growing issues arise, such as homelessness.
Homelessness has intensified as a concern in cities across the country in recent years, and Kelowna is no exception. It requires a focused response from all levels of government, including the local level. Developing a balanced strategy to address homelessness in Kelowna, such as adding enforcement and support staff, will be an ongoing focus of City budgets. As financial and staff resources are diverted to address homelessness, other City services may receive less funding to minimize the tax demand.
Community safety continues to be a significant part of the City’s budget, with requests brought forward for two new RCMP members, ongoing RCMP contract costs, continued work on the Police Services Building, Glenmore Firehall upgrades, needle sterilization and disposal, a safety coordinator and the Homelessness Strategy term position.
2017 Financial Plan summary
|Actual 2015||Revised 2016||Final 2017|
|Net operating budget||113,008,079||120,062,230||127,044,820|
|New construction tax revenue||(1,456,700)||(1,667,000)||(2,600,000)|
|New BCAA desktop review revenue||(940,000)||0||0|
|Police Services: building & contract||1.77%||1.97%||1.56%|
|Net property owner impact||3.20%||4.11%||3.84%|
Every year presents its own budget challenges and difficult decisions. This year, the City budget focuses on innovation, finding new ways to generate revenue and supporting core services, and foundational support that may not be as visible as major construction projects, but is just as important.
Council approved final budget requests on April 25, 2016 and set a 4.11 per cent increase. A tax rate of 4.11 per cent means the owner of a single-family home with an average assessed value of $501,410 will pay $1,861 for the municipal portion of their property taxes.
A City property tax bill will also include other user fees such as curbside collection and levies for other taxing authorities (e.g. School District, Regional District of Central Okanagan, Library, Hospital and B.C. Assessment Authority).
The increase is slightly lower than the 4.12 per cent increase approved by Council at the provisional budget deliberations in December 2015.
City Manager's Message
From the City Manager's message from the provisional Financial Plan:
The 2016 Financial Plan presents Council with responsible choices that follow through on [...] priorities while keeping property taxes and fees affordable. A corporate culture of innovation and continuous improvement continues to produce the highest value for citizens when delivering Council priorities.
For more information about this year's budget, check out the full financial plan (online magazine) or the following PDFs:
- Final budget, presented to Council April 25, 2016
- Carryovers , approved by Council March 14, 2016
- Provisional budget , deliberated by Council Dec. 17, 2015 and included:
Financial Plan Summary
|Net Operating Budget||106,097,818||112,777,905||120,062,230|
|New Construction Tax|
|New BC Assessment|
|Net Property Owner Impact||2.50%||3.20%||4.11%|
Based on the 2015 Financial Plan, Kelowna's property tax increase for 2015 is 3.2 per cent, an average increase of $55.42 for a Kelowna homeowner.
With work beginning on the new Police Services building and Police contract cost increases, Protective Services will account for more than one-half of the tax demand in 2015: 1.77 per cent is for the new Police Services Building project and Police contract cost increases associated with indirect costs for pension and recruit training; and 1.43 per cent is for all other City operations and capital projects in 2015.
Property taxes will provide $113.5 million of Kelowna's overall $477.3 million budget. Taxation makes up 24 per cent of total revenues.
A total of $212.7 million will be invested in capital projects in 2015.
2015 Financial Plan
The provisional 2014 Financial Plan sets an average municipal tax increase of 2.49 per cent. Property taxes will provide $107.9 million of Kelowna's overall $288.8 million budget. Taxation makes up 25 per cent of total revenues.
A total of $44.5 million will be invested in capital projects in 2014.
2014 Financial Plan
- Council Changes
- Financial Plan
- City Administration
- Strategic Services
- Community Planning & Real Estate
- Active Living & Culture
- Civic Operations
- Corporate & Protective Services
- Communications & Information Services
- Human Resources & Corporate Performance