Budget Restores Transfers to Historic Levels

On Tuesday, Finance Minister Mike De Jong tabled Budget 2014, announcing a shift from a deficit to a surplus position this year. Budget 2014 will also see transfers to local government restored as part of a planned return to historic funding levels.

B.C. is forecast to end the 2013/14 fiscal year with a surplus of $175 million, and Budget 2014 forecasts surpluses for the next three years - $ 184 million in 2014/15, $206 million in 2015/16 and $451 million in 2016/17. The budget relies on continued economic growth, with forecasts of 2%, 2.3% and 2.5% over the next three years, as well as continued spending discipline within provincial ministries and service delivery agencies.

Budget details of interest to local governments include:

Local Government Finance

  • The 2014/15 budget for the local government section of Ministry of Community, Sport, and Cultural Development is $143.5 million, compared to $103.7 million last year. This $40 million increase relates to Traffic Fine Revenues, Small Communities and Regional Districts Grant funding, and the Peace River Fair Share Agreement.
  • This amount is not new funding, but rather, part of a planned return to historical funding levels following accelerated payments under these programs in 2012/13.
  • The return to historical funding levels for these programs, and the maintenance of funding for these programs during tight fiscal times, supports the resiliency option outlined in UBCM's Strong Fiscal Futures report.

Taxation

  • Budget 2014 increases the threshold for the first-time buyers program to $475,000 from $425,000, an exemption from property transfer tax that can save the purchaser up to $7500 when buying their first home.
  • Amends the Film and Television Production Regulation, which extends the Distant Location Tax Credit to the Capital Regional District.

Economic Development

  • $29 million over three years to support the development of a liquefied natural gas industry, including incremental funding to the Ministries of Aboriginal Relations and Reconciliation, Environment, Forest Lands and Natural Resource Operations and Natural Gas Development.
  • Budget 2014 outlines a proposed new income tax on liquefaction at LNG facilities, with anticipated introduction of legislation in Fall 2014.
  • An additional $12 million in 2016/17 for silviculture, inventory and forest and ecosystem health/restoration activities to support areas hit by the pine beetle epidemic.

Infrastructure and Transportation

  • Budget 2014 outlines continued investments of $3.4 billion in the provincial transportation investment plan, which includes projects such as the George Massey Tunnel replacement project; interior and rural side roads upgrades; and the Cariboo connector program. The budget does not include new funding allocated for the Building Canada Fund at this time.

Community Safety

  • $15 million over the next three years to fund increased RCMP costs.

Environment

  • Provides $9 million over three years to support environmental assessments of resource development impacts of proposed LNG facilities and pipelines.

Affordable Housing

  • An additional $58 million over the next three years for the BC Housing Management Commission (BC Housing) to provide operating subsidies to non-profit housing organizations to offset their costs of assuming mortgages on provincial social housing units.

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