Budgeting 101

What is the Budget and how does it affect me?

The Budget is a “plan” that determines the day-to-day activity requirements, duties, purchases and projects that Lethbridge County staff will complete throughout the year, such as grading, snow plowing, bylaw enforcement, road and bridge maintenance/replacement, water and wastewater services, and much more.

Every municipality in Alberta is required to create a budget each year. The budget must be balanced, meaning there is no surplus or deficit.

The Budget reflects the priorities Council sets for administration to carry out, as well as the values of the County’s Strategic Plan, which are:

• Prosperous Agricultural Community
• Outstanding Quality of Life
• Vibrant and Growing Economy
• Effective Governance and Service Delivery
• Strong Working Relationships

The Budget affects all citizens, businesses, and stakeholders because it determines what services you receive, and what taxes you will pay. It is always challenging to ensure that we can provide the municipal services expected, while keeping taxes at a reasonable rate. The budget process involves making many decisions on how to spend taxpayer dollars responsibly and efficiently.

Operating and Capital Budgets

The County has both an Operating Budget and Capital Budget:

Operating Budget

This includes things like:

• Purchasing goods and services
• Salaries and benefits for staff who carry out activities such as snow plowing, mowing, grading, planning and development, etc.
• Contracted services
• Building maintenance
• Vehicle and equipment repairs
• Contributions to:
  1. Recreation in neighbouring municipalities
  2. Provincial policing costs
  3. Community associations in the County
  4. Organizations like FCSS, Chinook Arch Regional Library, Lethbridge Regional Waste Management Services Commission, etc.

Funds for the Operating Budget come from:

• Property taxes
• User fees
• Utility rates
• Licenses and permits
• Service agreements
• Transfers from Reserves
• Leases
• Enforcement fines

Once the County estimates the expenses for the upcoming year, and identifies funding sources, the remaining revenue required is collected through taxation.

Capital Budget

This includes things like:

• Road and bridge replacement
• Large paving projects
• Vehicle and equipment purchases
• Playground replacement

Funds for the Capital Budget come from:

• County reserves
• Proceeds from the sale of equipment
• Debentures
• Grants

General tax revenues (property taxes) are not used to fund capital projects.

What can affect the Budget?

Many things can impact the budget, including:

• Keeping tax increases reasonable (generally no more than 2.5%)
• Current economy
• New initiatives
• Increased responsibilities
• Demand for new/improved infrastructure
• Availability of provincial and federal grant funding
• Costs passed down to the County from the provincial and federal governments (i.e. policing costs, recreation costs to other municipalities, etc.)

The Budget process

The budget process takes place year-round, from Council’s Strategic Planning in January to Budget approval in December. Supervisors begin a thorough review of their Capital and Operating Budget requirements for the upcoming year based on Council direction and activities over the past year. Department Directors and Supervisors then meet several times over the next few months to review and deliberate their draft budgets. A proposed draft is presented to Council for their review, input, direction, and final approval.

Once the budget has passed it is the responsibility of all departments to implement the services and make the required purchases as approved.

The Finance department is responsible for monitoring and reporting on the revenues and expenses for the County. Quarterly Financial Reports are presented to Council with estimated projections for any potential surpluses or deficits that may occur.