The Amalgamation Option

Overview

Shelburne may wish to consider amalgamation with another municipality as a way to manage costs and share resources. For the purposes of analyzing potential benefits, a comparison was done with the Municipal District of Shelburne (MDS), for service levels, costs and tax burden.

What could happen to the Tax Burden?

Commercial Tax Burden (see assumptions) in the Town could go down under the amalgamation option - a significant economic development consideration (residential would remain similar to now with potential for a small decrease) .

  What Could Happen to Town Service Levels and Costs?
 

Assumptions for Purpose of Analysis:
1. 2010/11 assessments and 2009/10 rates
2. Tax burden examples-residential assessment $57,000; commercial $100,000
3. Service delivery levels as above
4.No debt at amalgamation
5. Municipal District of Shelburne tax structure remains same
6. Town roads will qualify for PNS J class road service and existing charge per kilometre
7. Option A - gap between revenue generated by town assessments under MDS rates and town services to be paid by all taxpayers (Town and MDS)
8. Option B - gap between revenue generated by town assessments under MDS rates and town services to be eliminated through negotiations to service and other assistance.
 

The Bad News

The bad news is that there is some urgency to take action:

• The population is declining at a significant rate
• Population and assessment are linked - as population declines assessment will follow
• Current conditions aren’t sustainable
• Slow steady decline will increase rapidly to an unrecoverable point
• Residents will lose the value in their homes and attracting residents and business will be next to impossible

The Good News

There are opportunities and Shelburne has the ability to get in the drivers seat and create the conditions for future success, rather than just accept what is happening today.
Opportunities include: 

• There is an inheritance - a foundation of financial stability to use as a base for the future i.e., high residential assessments per dwelling unit 

• Town Council is taking action 

• With a new Council and motivated staff the Town is positioned to mold their future 

• There is mutual interest in exploring partnerships/amalgamation with neighbours to create win / win solutions. 

The things that need to improve are mostly within the control of the Town.

Service Review - Benchmark Towns

To help understand the current ‘health’ of the town, it is beneficial to see how Shelburne compares to similar size towns in Nova Scotia. We’ve called these the benchmark towns. The benchmark towns are: Berwick, Digby, Middleton and Stewiacke.
Shelburne compares well to the benchmark towns, being fairly middle of the road for most service levels and costs. Research did identify that Shelburne has the highest recreation cost of any of the bench-mark communities.
Of concern is that although Shelburne’s dropping population is the biggest risk to the Town, Shelburne has no planning and development service and compared to the benchmark towns, is the only town without an economic development function. This situation needs to be addressed.

If the population continues to drop as projected, per capita costs for town services will double in the next 10 years:

Letter From the Mayor

Shelburne is at a crossroads. We face some significant challenges, but we are fortunate that we also have opportunities. These challenges and opportunities are described in the blog. We are in the drivers seat but we must act now before our opportunities are lost.

This is why Town Council needs to hear from you, the citizens and businesses of Shelburne to tell us what you want and where you would like us to direct our future.

Please read this blog, attend the Public Meeting or Drop In (see tab above), and provide your feedback.

All the best,

Mayor Al Delaney

Project Description

The project will proceed in two, related pieces:

1. An operational review to examine finances as well as efficient and effective service delivery
2. A municipal governance review (what form of municipal government is best for the Town of Shelburne)

Operational Review

The operational review will document the services and finances in Shelburne, provide some comparisons to other municipalities, and identify the implications and risks associated with continuing on the current path.
This review will also provide a bench mark for testing potential solutions and monitoring future progress.
The operational review will develop an under-standing of issues and needs related to such services as police, fire, economic development, water, land use planning, etc.

Municipal Government Review

Shelburne Council wishes to examine and understand, with their community, how town services and taxes would be affected under various municipal government scenarios such as:
· Maintaining Shelburne as a town
· Amalgamation
· Amalgamation and becoming a Village or developing a Community Committee

Examining services and Town government alternatives (governance) will be done with the community. Some of the questions the community needs to consider are:
· What services and service levels are needed?
· Can we afford them?
· How will each governance alternative affect Shelburne’s ability to implement the community’s Vision?
· What criteria should be used to evaluate the governance alternatives?

Please stay tuned and participate, to bring the best solution forward.

Questions and Answers

1. What does amalgamation mean?

This means to combine two or more municipal units and Councils into one unit with one Council

2. Would we lose our identity as Shelburne?

No, Shelburne would continue to exist as a community, in the same way that Liverpool exists within Queens.

3. Are there options for us to maintain specific representation and /or tailored services for Shelburne, within the amalgamation option?

Yes, a Village is created within a municipality for the purpose of furnishing higher levels of mu-nicipal services to a more populated area of a rural municipality. For example New Minas is a Village and part of the Municipality of Kings. Councils may also create Community Committees to advise them on appropriate service levels for an area.

4. How does amalgamation occur?

The Utility and Review Board studies the municipalities and decides how costs are allocated within a new amalgamation, or the two municipalities negotiate an agreement that is passed as a Private Members Bill.

5. Would amalgamating save money and keep taxes down?

We don’t know yet. That is part of what the current project is designed to tell us. While we won’t be able to give specific answers to the taxation question (see question # 4), we should be able to determine whether savings are feasible. note: from newsletter 1; see newer posts

Issues and Options Summary

Why do we need to look at our options?

Shelburne is at a cross roads. The following issues need to be addressed: 

• Declining population - 13.5% drop from 1996 to 2006 

• Eroding tax base and decreasing financial reserves 

• Increasing service costs

What are our options?

There are options which may help address these issues, for example: 

• Amalgamation with a rural municipality 

• Remaining a Town and raising taxes and / or cutting services 

• Sharing more services with other municipalities may help as well

Note: Community Economic Development should be part of whatever solution is developed. This study is looking at shorter term financial and governance issues.

Letter From the Mayor

Shelburne Town Council became aware through their first budget year that the current town services and tax levels aren’t sustainable. A declining population and increasing service costs mean that the town can’t continue as is. We’ve agreed, as a Council, that we’ll provide the leadership to develop solutions to our community’s long term viability during our four year term.

Town reserves have been used and budgets cut in an effort to keep taxes down. While we’ll look for efficiencies, the time has come when bolder steps are needed. Current service levels can’t be maintained within existing tax levels and there are few buffers or reserves for emergencies.

Opportunities for input and for providing feedback are outlined to the right. I look forward to working with you as we make important decisions about how to realize our Vision (sidebar) within the means we have available.

All the best,

Mayor Al Delaney