NOTES: The report presented at the meeting is available on the gabriolafire.ca site. Unless they touch on procedural matters, the auditor’s comments when reviewing the document are not transcribed. All questions asked of the auditor and of the board are transcribed.
CHAIR: A couple of points of order from past meetings, just to clear things up. The formal distinction between a meeting and a session is very nuanced. So over the last week, I've researched and consulted with an accomplished facilitator, and tonight's meeting is an adjourned meeting, or continuation of the annual general meeting, but as part of the same session. I mention this because I misspoke at the last general meeting, and there are procedural implications of the distinction. With respect to the voting rights of the chair, it is now my understanding that the chair has one vote and votes at the same time as the rest of the voters. This is based on BC government guidance from their website and the 1995 Letters Patent. If the vote results in a tie, the topic of the vote is defeated. Thanks to those with proficiency in parliamentary procedure who have taken the time to help me do better.
AUDITOR: DOUG PARKHURST, KMA Chartered Professional Accountants
… The only part of this package that is mine, are the two pages of the [auditor opinion?], the actual financial statements, are actually considered the board of trustees responsibility. … Our opinion is something called a clean opinion. We don't have any qualifications, any exceptions. We're saying it's presented in accordance with, it's called PSAS, Public Sector Accounting Standards, and that's the accounting standards for both local government, federal government and provincial governments. Last year, we had one qualification that we were able to remove this year, and that qualification was to do with the fundraising around the EMR training. Well, there was a minimal amount of it this year, so we concluded we could remove it. So that's basically the difference in the opinion. Otherwise, we're saying that to the best of our knowledge, based on all our testing and additional work, the financial statements appear to be free of material error.
The auditor then went through the financial statements, adding amplifying info about some categories of information. Some specific items that may be of interest:
- For fire departments the hall and trucks are the biggest assets, and are amortized based on their expected life; usually a truck is about 20 years, the building is about 40.
- Most income is from our tax levies, but in the last couple of years there has been fairly significant income from deployments, i.e. responding to provincial requests for equipment and personnel to help fight wildfires.
- New truck: “When you build a new fire truck, you usually go off, you order the chassis, and you work with somebody to actually get the cab, the boxes on the back, the tanks, all that kind of stuff. That's what the real cost is, getting all that customization.” From Notes to Financial Statements, a commitment note (#13, p14): “when the improvement district has signed a contract for something, and it's obligated to fulfill that contract, that’s called a commitment.” Commitment. In December 2023, the improvement district committed to purchasing a new fire truck. The truck chassis was purchased in the current year for $199,200, plus applicable taxes. The installation of the superstructure on the chassis was on-going at year end and will cost $517,899 plus applicable taxes, for a total acquisition cost of $717,099 before taxes. Completion of the superstructure and payment will occur in 2025. The acquisition will be funded out of the Capital Reserve Fund.
- Note #14, Subsequent events, acknowledges the existance of a lawsuit and the unionization of employees, both of which may affect expenses in 2025.
Questions
QUESTION: Under professional fees, there is that, can that be broken down on what is the Freedom Of Information, what is accounting, what is legal?
AUDITOR: [as people begin looking through documents] It would be in “trial balance.” [Discussion re where to look in financial documents]
Q: It’s under Expenses.
AUDITOR: Yeah, but in the trial balance, every single account is like, 3 or 4 pages long. So you have to go look at what makes it up.
[Discussion]
CHAIR: I can look up the last report from the previous chair on Freedom of Information Act response costs from the minutes while Doug finishes up, and report that back to you—
Q: I’m just curious, because it’s a big bump.
QUESTION: I had some questions about the expenses, and on page four of your report, I noted that through 2023 expenses were 337 for wages and benefits, and they've gone up to 475. Could you you itemize where that rise in wages and expenses came from?
AUDITOR: It was a couple of things. One was an additional officer hired through the year, like an additional new position created and added. There was some costs related to turnover of staff, that the people that came in were more expensive than the previous people. That was unanticipated. And then you also just get, generally, increases across the board for everybody else.
Q: Were you were able to tease out how much of that was due to overtime pay?
AUDITOR: No. We do testing on payroll overall, test the accuracy and things like that. We don't, it's not conventionally reported as, separate things like over time are not normally presented as separate line items.
Q: So you couldn’t discern whether there was an inordinate amount of overtime pay last year, for example.
AUDITOR: Inordinate, not typically, no, we didn't see anything. We saw the major drivers for these things I mentioned. Another thing that I'll just say about that is that's affected as much by weather.
Q: Dropping down to professional fees. I just wanted to ask you about that as well. It also shows a marked increase from 2023 to 2024. Could you advise me if you did a breakout of the categories you mentioned, legal fees, you mentioned, I believe the cost associated with FOI, you put in that category—
AUDITOR: It's already in the improvement districts trial balance that way, and that's the way historically it's always been presented. And so for comparability, we actually leave in the same category. It's a bit of a trade off, but we made the decision to leave it where it's at, for, we call it grouping. The bulk of the cost was FOI.
Q: So were you able to discern from your purview of the information whether or not there were significant costs accruing due to HR, Human Resources consultations?
AUDITOR: There was additional cost for hiring outside help related to some HR-related matters, complaints about some HR complaints. And so outside consultants were hired to basically satisfy WorkSafe. And so there's a bit more to that this year than the year before.
Q: And that would have shown up in these professional fees.
AUDITOR: yeah.
QUESTION: Do wages and benefits include a raise for firefighters?
AUDITOR: Some people got raises during the year, and that yes, that's included.
QUESTION: The extra cost for FOI, are FOIs like, you can’t find out why there was an FOI? Is it confidential? Or why would there be more cost for FOI? What [?] could that be?
AUDITOR: If someone makes an FOI request, for the most part the improvement district, all governments, have to bear the cost of responding. So you know, the biggest issue is, do you get three? Four? Five? […] But when you look at the amount of information you have to go through, vetting … Are there other people in there? [?] privacy, which is a lot of when things are, when you see stuff blacked out, that’s what it's about. They’re kind of on the hook for doing it. There is, I certainly know there was questioning back on some of them about, is this a repetition, or is this considered separate, things like that.
Q: My question was, can our FOI, is it confidential, can me as a person, okay, we have X number of dollars for all these FOIs. What were they? What was it about? Can I go and find out what they are, or is that confidential? That’s what I meant.
CHAIR: I can answer that: yes, mostly, depending on what was requested. I can disclose that a number of them were from me, and if you want to know, you can just contact me, and I will release the information that I received to you. So if you want to know, you can just ask me, and that's probably the easiest way. It doesn't actually involve board, because it all took place before I was elected.
Q: So they're sort of confidential.
CHAIR: Depending on what's requested, it could be. The ones that I have requested, I can disclose to you that they are not, because they're not.
Q: So is there a set fee, or is one FOI more than another one? Or is it a set fee?
AUDITOR: No, they're pretty much driven by time and cost. So, yeah, it will be the amount of documentation that goes on to the service, the time they are spending vetting will drive a lot of it. So is there three pages or 300? That's where the cost is.
[multiple voices]
QUESTION: I’m just wondering, given that there’s been a significant increase on the cost of wages, would it not be helpful, looking down the future in five years time, we pull these out whenever we’re looking, and depending on the institutional memory or not, we might not know what they are, and I guess I’m used to seeing some note that says, that explains the increase, because an additional person was hired and whatever, something that helps the—I know it’s not been practicing—
AUDITOR: Actually, I can comment on that. Larger governments that have the resources to do it will write what’s called a Management Report. It’s intended—you’ll see this with public companies. If you go look at someone like [?], it’s the biggest part of their Annual Report, it’s what managements commonly [?]. And so that’s where a lot of it comes from. You know, the challenge for Gabriola is simply resourcing, having the bodies to do it.
Q: Excuse me, yeah, maybe I wasn't clear. I was asking whether or not a statement, the financial statements, could simply have a note, like there are many other notes saying, “In fiscal year whenever, a new person was hired.” What explains a significant cost—
AUDITOR: That's actually what's put in a management report, not on the financial statements. So that's actually where it would be.
Q: Your management report to the board, you mean?
AUDITOR: No, no, no, no, management report to the—to you guys. That's what it would actually be. So where it can also […] for example, when you look at your fleet, you get somebody like Fire Underwriter Services to come in, and they give you a report of “this is when you need to replace this stuff. Here's what you should look at. Here's what we recommend.” And that's the kind of thing that actually is way beyond what we're doing with a set of financials. But that's the kind of thing that an annual report would include. So that's what I'm saying. It would come from management as part of a package over and above this.
Q: And who would be preparing that?
AUDITOR: These guys. [indicates board]
Q: Then this would be the report to the taxpayers.
AUDITOR: Yes.
So what you'll find is, one of the differences between improvement districts and municipalities, is municipalities are required to put this in their annual reports. That has not come down to improvement districts. And to be very honest, because of the time and effort and cost, a lot of improvement districts, you know, it's like 27 people on one water system. Salt Spring has got five different separate improvement districts, all to do with different supplies of water in different parts of the island.
Q: So are you saying that if you added a note about why the increased costs for significant increased costs in these categories, that that would not be acceptable, or just—
AUDITOR: Well, part of it is, it's not part of the standard. It would add probably significant cost to the financials to prepare that note and to do the auditing to verify that. The actual overall audit, which is the approach currently, is where you have to get down to a lot more detailed work.
Q: I'm just trying to clarify... So if we wanted all those extra details on either wages or insurance or professional fees, etc, we'd be putting the burden on the board.
[Auditor indicates affirmative.]
Q: The board would have to hire somebody to do this?
AUDITOR: […] Running those kinds of extra reports, even for a small organization, is surprisingly time consuming. So I would say to somebody, that where the Board of Trustees is going to have to balance out the cost of doing that versus the benefits to the public.
QUESTION: Page four, almost all the way down, under expenses. You've got emergency response, which is approximately 25% of what it was in 2023. Can you just clarify what is covered by emergency response and why the … significant difference?
AUDITOR: Emergency response is the cost of deploying to other parts of the province. So you'll notice, and just to correspond, you’ll notice the revenue at the top part of the income statement of operations, it went down too. social expense. It's revenue and expense.
Q: So the deployment went down from 30,000 to 26,000
AUDITOR: Will, do you want to comment on where you guys went?
CHIEF SPROGIS: Yes, we drove to Salmon Arm.
Q: And so correspondingly in the expenses, it went way down.
Q: I was reading deployment revenue, so you’re talking about deployment revenue.
AUDITOR: Will do you want to explain? I always find this stuff personally fascinating.
CHIEF SPROGIS: We deployed to Armstrong BC, and we fought the wildfire there for six days.
AUDITOR: Do you remember where you guys went the year before?
CHIEF SPROGIS: We went all the way to Fort St John.
QUESTION: I'd like some clarification about the commitment for the new vehicle on here, Note 13. It says that the chassis was purchased in the current year for, let's say, $200,000 and then in the coming year it will cost another $500,000 but then it says the acquisition will be funded out of the capital reserve fund. Doesn't look to me like there's enough in the capital reserve fund to cover that expense.
AUDITOR: I would suspect the Board of Trustees is going to have to face that decision at that point in time. So it didn't impact the ‘24 financials, other than we put the note in for our commitment of how and what. Those are the plans to fund it, but how they actually do it will be decided at that point.
Q: Well, I sort of had the impression that the big increase in the current year and the big increase in the tax levy was largely down to this acquisition. Am I wrong there?
CHAIR: If you don't mind deferring the answer to your question briefly while I look up the budget for this year, then I can answer that, and we can allow Doug to move on the next question. If that's okay?
[Affirmative]
QUESTION: Going back to the accounting for wages and increases in staff, I would hope that in the process of managing the organization, that you evaluate what the cost of hiring a new person is, or providing raises, so we should be able to get some management reporting that is a summary of what was done to present to the board to allow those things to happen. If we just go off and do them and then say, “Gee, we never figured out what was going to happen,” that doesn't make a lot of sense. I'm no stranger to running an organization. So was the work done? Nobody knows.
[multiple voices]
So my job is, understand, I’m auditing the actual numbers, and so we—
Q: I understand, and you don't have the detail in your accounting that that should come from management reporting, but there's an increase in wages and salaries that I understand is something in the order of $150,000. Who did the evaluation of that? I mean, could we afford it? Where was it going to be spent? What was the justification for it? That should exist.
AUDITOR: So, who is in the Board of Trustees decision last year?
Q: Yeah, I would think the corporate officer, or whoever that person was or wasn't, or just isn't there anymore, would have done that. That's sort of the business partner for the organization.
CHAIR: I can answer a little bit of that question directly, in a little bit, maybe indirectly. I'm gonna remind you that I’ve been in the chair for three weeks.
Q: That's no excuse! [laughter]
CHAIR: I'm not saying I'm not answering—
Q: The honeymoon's over, baby!
CHAIR: and I'm up here. So the on the website, under the long range plan and levy proposal, there are three documents. The presentation of the levy and the levy proposal for 2025 contain a number of budget forecasts and charts and assessments, which, so far as I understand it, represent the summative work of what you're talking about. The actual work that was done that led to the summative statements available on the website occurred before my time, and I can't answer in detail. I can see if any of the other trustees, who've been around for longer than I have been is able to provide detail on how that work was done. But all I can point you at is the end result of those documents, which contains projections and assessments.
Q: I understand that. The accounting side is saying, we don't get that detail. I would hope that management would give—
AUDITOR: What I'm saying is we, when we're auditing the financial statements, we're auditing that whole 475, as a whole. What we're not looking at is efficiency or effectiveness. We just simply are looking at, these are the dollars spent. That's a different kind of audit.
Q: I understand, but, but they could summarize some management information about all of that and provide it to you to roll up into your financial statements, but it's the what exists or what was prepared to justify those changes that I'm thinking should be happening.
AUDITOR: Like I said, that’s what management reports are for.
QUESTION: Can I ask about the insurance? And maybe this is a question for the board rather than you. But insurance, is it split down between equipment, personnel, trustee liability, firefighters liability… It's just one big “insurance,” surely, that's made up of more than one policy? Yes, so that's something else that would have to come from the board who doesn't get paid for this. Okay, and the other thing was “Office and Trustee.” What's the difference between Office and Trustee? Or do you mean trustee work, as opposed to office for the chief, work for the chief, I don't understand Office and Trustee as an expense. […] Cause it’s up quite a bit too and I just wondered what it was. And the reason I was asking about insurance and liability is that I want to know who's going to be liable for legal costs, and if there's insurance to cover that for the board.
AUDITOR: Okay, I haven't got the exact grouping [?], but there's definitely three things, it's likely, including: trustee office expenses, office and admin and, yeah, those are the two major items. Office was 11,200 and office and admin was like 17 and a half 1000, or something.
Q: Trustee would mean admin?
[someone says yes]
QUESTION: I'm just wondering what the purpose is of putting the budget for the year in the financial statements.
AUDITOR: It's a convention done with most local governments, and it's to give you the reader, the ability to see—the budgets, obviously, was what the Board of Trustees had planned for ’24, and the actual is that, the actual numbers, so you can see, this is what they were thinking of, versus what they actually spent.
Q: It surprised me then, that some of these budget lines don't have a budget number, like “amortization” or “interest on long term debt.”
AUDITOR: So we report what's in the actual budget that's approved, and if the Board of Trustees wanted to budget those other items they could certainly add them.
Q: So they do their budget, and then they give that to you, and you put it in here.
AUDITOR: Yeah.
[After this point there are no more questions for the auditor, who leaves. The Chair notes that the Letters Patent require the Board to “present to the landowners a report on the operation of its services and a statement of the financial condition of theimprovement district” and to “discuss with the landowners matters relating to the services or finances of the improvement district. He goes on to explain that the acceptance of the audited statements is a decision of the Board, not the landowners.]
CHAIR: But before we accept the statements, there's no prescribed order, so it seems useful to carry on with questions. If questions diverge from finance, we may accept the statements and go back. We'll have to see how that pans out.
I had a couple of questions that I said that I would answer. After looking things up about the Freedom of Information Act response cost, I wasn't able to find the exact figure, but I can ballpark it for you, if that's satisfactory. And I believe in 2024 it was in the neighborhood of $30,000, which comprises the bulk of that line item.
And then I think I answered questions about the summative reports of the work that was done by the board. So from my research on annual general meetings past, such statements are not traditionally part of what is presented by this board to these land owners. Clearly, it is a feeling among at least some of you that more information should be provided. My plea to you is to put that in writing and send it to us as correspondence, because that provides evidence that we can refer to in analyzing what it is that landowners have concerns about, and that can help shape our response. And without that evidence, it's hard to arrive at common ground about what direction we should be moving in, and what attention, what things we should be paying attention to.
[The floor is opened again to questions.]
QUESTION: I'm a landowner and a taxpayer, and I'm concerned about the increasing taxes that I've been paying, primarily for fire protection. I don't mind paying for fire protection, but when I look at the revenue and the expenses, I'm concerned about the vast increase, the 41% increase in wages and benefits from 2023 to 2024, so my question to the board is: we trust you. We elect you as trustees to look after us and to make sure that we're spending our money wisely. I'm concerned because there are two subsequent events alluded to by fellow from [KMA], and you've got the lawsuit on your hands that you're going to have to come to come to grips with, that's going to cost a lot of money and legal fees, and you also have a commitment to buy a new fire truck. So I don't want to come back here next year and see that my taxes have gone up astronomically as a result of some of the activities that have occurred. So I'm asking you, as a board, do you have in mind reducing some of these expenses and subsequently reducing our taxes?
CHAIR: I can answer probably only some of that question, because that's a big question. So one of the things that I can say is that the commitment to the wages as part of the increase to taxes in 2025 which we are now, I'm losing track a little bit, are a commitment to raise firefighter wages across the board. Previously, firefighter wages had not always met the standard minimum wage because of ambiguity around volunteer status of the fire department and what obligations that entails. It became clear in […] preparing the budget for 2025 that it was necessary to increase those wages, and that represents a not insubstantial portion of that increase that you're seeing in the wages line. It's not projected that there be further increases in wages like that. However, we are entering into union negotiations, and there will naturally be some negotiation around wages as part of that process, and how that turns out is not predictable from where I sit right now.
The auditor also noted that a new full time deputy chief position was included in that, and that represents, by the time wages and benefits and things are rolled in, a substantial portion also of that increase. So those two items account for most of the large increase in wages and benefits that are reflected in the 2025 budget.
To the extent that in our budget planning for 2026 we're able to adhere to our projections, the projected increase is in the neighborhood of 9%, it's nine point something I believe, but I don't have it off the top of my head. So the increase is projected to continue, but the slope levels off over the next, I believe the work that was done projects over five years, at which time things […] are anticipated to be fairly stable.
One of the situations that we're working with is that after the construction of this fire hall, there was a period of time where the tax levy on landowners was kept low, and that has also imposed on us some necessity of playing catch up. And that's a situation that is a legacy situation, if you will.
So I hear your concerns, and attention is being paid to them, but I don't have definitive answers about how they how it will pan out, because the union negotiations are a big source of ambiguity.
With respect to legal matters, essentially nothing can be said because our lawyers have told us not to say anything. So we're not going to say anything about that, because we're going to be guided by legal counsel. With respect to the fire truck, the plan, as I understand it, based on the three weeks I've had to extensively review things, is that the capital levy, the capital portion of the 2025 levy, will cover most of that cost, and then what's remaining in the capital fund will cover the rest of that cost. So the cost of the fire truck, as I understand it, is fully budgeted for. Is that correct, Will?
CHIEF: Yeah, that's correct. We just require this year's levy to come in, which just came in.
CHAIR: So once this process, that fire truck, which is a substantial expense, is paid for, then we move forward, and the next major capital expense of that kind is whatever large truck next needs replacement to maintain our obligations, to maintain a fleet of a particular size and type.
QUESTION: Isn't there an additional factor in that budget line item, which is that the board is contemplating adding yet another position to the staff—or firefighters. I'm sorry, I'm not sure which, and I’m glad about the—
CHAIR: Contemplation is maybe over strong, a recommendation has been made by the front line fire fighting staff that their administrative and training needs would be best met through the addition of an additional—Assistant Chief is, I believe, the proposed title. The stage where that is at, is we're now looking at the needs of the fire department operationally, the capacity of the improvement district, in terms of its administrative and tax base, and working towards the best fit for the solution for the needs of the fire department. So one of the proposed solutions is that staff position, and that's been presented to the board, and the board has asked for more detail, and that detail is being generated. That's where the process is.
Q: And I'm so glad to hear that the wages of the fire department have come up to at least minimum wage, and that there's going to be more discussion with them. Yes,
QUESTION: You had mentioned the issue of the legal fees and being advised by counsel not to speak about the legal matters. And I understand that, but this would be a question you can answer. For years the improvement district made use of counsel in Nanaimo, and then with the unionization and the lawsuit […] by Dr Dow, for wrongful termination and harassment, the improvement district went out and hired one of the largest and most expensive law firms in the country. And I note that Mr. Giffin previously explained that it wasn't that much of an issue because Stikeman Elliott has offices in Vancouver. However, both counsel of record for the unionization file and for the litigation file on the counsel record are in their Calgary office. And so these are the people who will be attending the meetings. These will be the people who are doing the depositions.
TRUSTEE MOHER: To the Chair, please?
CHAIR: Yes?
TRUSTEE MOHER: I'm sorry, but he's starting to talk about stuff that talks about legal and this is about the budget, so I would ask that we move along. I would say that what was needed is information that could impact any part of the legal, cause I’m looking at faces here. So I would ask the chair to respectfully him to ask you a question or move on.
CHAIR: I think that's a fair qualification, so if you can move to a question…
Q: I would like to know, since this issue has been brought up on other issues, whether or not the improvement district contacted other law firms in the Nanaimo area or the Victoria area before hiring Stikeman Elliot.
CHAIR: My immediate response is that that's not information that I have off the top of my head, because I've been in the chair for three weeks. […] If you write correspondence asking that question, requesting that the board take it up, we will answer as fully as we are able in response to public correspondence.
Q: That’s not a problem, I’ll send it in.
QUESTION: I'm wondering if the legal fees being incurred by the board are covered under their insurance policy or not.
CHAIR: Give me a sec, because anything having to do with legal matters will require careful answering. … I think that there was a question about insurance earlier, and I can answer that by saying that the board does carry insurance. I can't say definitively, because there are issues of timing, whether all fees are covered by the insurance and things like that, and also because that's a level of detail that, frankly, I don't have. So I hope the answer that the board does carry insurance, and is all paid up with the insurance, is reasonably satisfactory.
QUESTION: Following up on the person in the front's question about managing the budget. My concern is that I feel like the taxpayer is being presented a blank check to sign each time the fire district wants a new fire truck or a new position or this or this or this. In the business world, they're often told this is what we can afford. You need to manage to that. So can we afford a new truck and a new assistant chief position and this and and a lawsuit at the same time? Probably not. So as a board, you need to be the managers and say, “This is what we can afford.” Maybe we hold this and we don't do that. I think it's great that we pay the rank and file properly. But when we get above that, do we need a brand new truck? Maybe not. I would like to see the tax increases limited, so you have a target to say that, yeah, we can afford 10% increase per year, not 35 and 50. That's just not acceptable.
CHAIR: Certainly I hear your concerns.
Q: Should I put it in writing?
CHAIR: To everyone, if you have concerns, the best way to convey them to the board is to put them in writing. In my commitments, when I was elected, is that correspondence will be acknowledged, included in the minutes, and responses may have to work their way through committees and will be slow, but we will just respond as fully as we are able.
The best type of correspondence says, “Hello, my name is (name goes here), I'm a landowner on Gabriola Island, or I'm a resident of Gabriola Island, and I'm very concerned with (whatever issue you're really concerned about), and would urge the Board to take it up at public meeting. Thank you very much.” That's a kind of correspondence that we can look at and act on. If you have more stuff than that to tell us, please tell us, but our responses will be slow.
Q: So I would ask the rest of the people here to express their thoughts on what reasonable tax increases are, because right now, it looks like it's open game, that whatever people dream up, they'll come out and say, “Oh, surprise, we got another big one.” It's not acceptable to me.
CHIEF: I can speak to the fire truck, just to make sure everyone understands why we're committed to making that purchase, and then maybe the board can go back and decide not to purchase it in the future. But we are stuck to a schedule of four new trucks every 20 years, if we want to keep the Fire Underwriter Survey. So that means a schedule of a new truck every five years, and they're good for 20 years. And then after 20 years, they don't meet the front line status and they move into a backup position. So you can write letters to the board suggesting that we not buy new trucks. But that's the implication, is that you might lose, maybe will lose your insurance Superior Tanker Accreditation. That's what gets the homeowners the insurance rate on their insurance. And if you're not aware of it, please go to your insurance company. It should say that you have a hydrant status within 300 metres of your house. And if you don't, please seek it out, because it's a huge insurance break. You'll find that that insurance break is is bigger than the cost of the fire improvement district tax.
CHAIR: Just in general, in response to your concerns about the continued tax increases: with the projections that were done prior to the 2025 budget, there is a capital plan to accumulate funds going forward, so that we have funds accumulated slowly, so that we're ready for the large expenses, so they don't come up as this one did, with a history of taxes being held at a low level. So those adjustments going forward, the planning has applied a sort of smoothing function to that, and those numbers are available. What happens in the world economy? Who knows? If you can prognosticate on that you're going to be very rich. You did, sir, inquire of the rest of the board, so if anyone on the rest of the board would like to address your concerns, I'll open the floor to them. Otherwise, we'll move to the next question.
TRUSTEE MOELLER: I mean, we did do a presentation on the 2025 budget. I did sort of a quick breakdown of the biggest items that caused the increase. And so what happened is we did a long range plan ahead of 2025 budget, and that hadn't been done for a long time, and we identified some some issues where things weren't being funded.
There was the SCBAs [Self Contained Breathing Apparatus], which is the packs that they carry. They're very expensive, and they time out, after I think 20 years. They were originally bought with a grant that the government gave us, and there's been no money set aside for replacing them. They were, you know, given to us, whatever, and they're going to time out in like, seven or eight years or something. And so we had to start setting money aside for that. It's like $400,000, so we just started adding that, because it wasn't done from the beginning. If it had been done from the beginning, we wouldn't have such a big increase, because there'd be a smaller amount added every year.
The other thing was, this building didn't have a maintenance budget. You know, there was no capital set aside for replacing the roof or the generator or the air conditioner when it blows up. That has to start getting accumulated. It's already 12 years old, this building. So because it wasn't being done for the last 12 years, we have to, unfortunately, do a big increase to kind of build up that fund now so that when the roof goes, we've got enough money to replace it.
And there was a couple of other things in there as well, I don't recall off the top of my head, but I can try and search, try and find that presentation and circulate it again so that everyone can have a look.
VARIOUS: It’s on the website.
CHAIR: One of the things that I think is also important to explain is that improvement districts, partly by their nature and partly because the decisions made by the provincial government, are limited in their opportunity to borrow. Municipalities and regional districts have access to government guaranteed or government subsidized—it's not really a subsidy, I just don't know the right word—loan programs which allow them to make capital purchases with guaranteed, sort of low interest loans. Improvement districts can't do that. And so what this improvement district has done over the past couple of years is elect to respond to that situation through accumulating capital funds. And so late in last November, four capital funds were established, and that's where the capital investment money is going for these funds. There's now a fund which will accumulate monies for maintenance and improvement of this building. There's also a fund for the purchase of trucks. There's a fund for the purchase of equipment, and there's a fund to handle—it's like a contingency capital fund. So if there's a large insurance deductible or something like that, a tornado comes through and breaks all the windows, there will be money accumulating for those kinds of purchases. Because those funds have just been initialized, they don't have a lot of money in them to start. And so that's what the projected tax increases over the next few years are, are projected to be for.
QUESTION: I did want to say we talked about spending money on equipment, and I remember […] you bought the Jaws of Life and everyone said, “Oh, that's too expensive.” And you know what? We didn’t use the Jaws of Life for nine years, but they practiced every practice. And guess what? One time when there was a horrific accident on this island, that person would never have gotten out. One of the firefighters, he came up and said, “Liz, we’re going to use the Jaws.” I said, “Have you ever used it?” He said, “No, but we've been practicing.” And they were superb. But it doesn't matter if we need it, then this is who we are. We're the fire department. We're the BC Ambulance. The equipment has to be bought. It has to be maintained. I know we have taxes and I am a taxpayer. I don't have a big, fancy, schmancy house, I have a little tiny house, but I pay my taxes. I want what's best for the island I love. What's best for this fire department and for the firefighters. They work hard, they practice—honestly, I still remember that day. That person would never have gotten out if it hadn’t been for the fire department and the Jaws of Life.
CHAIR: I think everyone on the board would echo the seriousness with which you take the responsibility of the fire department.
QUESTION: I just have an obvious question. I mean, it was said that the building is 12 years old, and there's never been a maintenance budget for the past 12 years. Why not?
CHAIR: Well, if you'll step with me into my time machine, we'll go and we'll figure that out. I think that as a board, our priority is to do the best we can going forward with what we've got, and that's, if there are no objections, that's our mission. I don't know why decisions in the past were made as they were.
QUESTION: I just have a question about the deployment and going to the interior. And I understand helping with wild fires, but maybe that's an area that we we could, you know, save on—
CHAIR: It’s an interesting question, because it does mean that resources and equipment are leaving the island. It's also true, as you said, that our commitment to cooperative work with BC Wildfire and other communities is super important. I know the chief feels very strongly about, correct me if I misstating your position, but about that collaborative work with other fire services and that commitment to other areas. It's also true that in the end, deployment is a source of revenue. The expenses come up front. The big revenue from that came in, I believe 2023, when deployment revenue was over $100,000; that cost something in the area of 36 grand up front. But the return financially is quite good, and the value of training and participation of those members that go and participate in those kind of activities is very high and has a high operational return. So it's worth considering and looking at closely because there are contracts associated with it, but the value that comes back is both financially quite good and operationally very high.
TRUSTEE CHORNEYKO: I'd just like to speak to people concerned about the financial cost and the financial management. I hear your concerns, and I've just been in the position for three weeks here, and I take the concerns very seriously, and I will be looking at it and ensuring that there's good value for the money. I also hear that, you know, we need to maintain readiness for the island, and so there's a balance here that has to happen. This can't be a blank check, as was suggested. We need to make sure that doesn't happen. But at the same time, we need to ensure that it's properly funded, so we'll work on the balance. A bunch of us are brand new here, and I’m really committed to that.
CHAIR: I'm going to make one quick comment, and then we'll move to the acceptance of the the audit, and then that will conclude the business.
So there is a large ambiguous thing about which I can't give a ton of detail, because I don't know a ton of detail, but it has to do with Hall number two, the south hall, which is old, small and on land that is Crown land, or land held in trust, or however you want to term that land. An application is in to have some kind of ownership of that, and then there will need to be a decision made about refurbishment, replacement or whatnot, of that hall, and the timelines on that are ambiguous, the results of that process are ambiguous. But there are two fire hall buildings on the island, and one of them is old and small. And so that's, in terms of expense planning and potential tax increases and things, that's a factor that the landowners deserve to be aware of.
AUDIENCE COMMENT: If people would look at the Long Range Plan or come to the board meetings, they would be getting some background on the personnel issues, the staffing issues. And the very good piece of information you gave about the South Hall was also in that plan and also presented at the meeting, of why there were no concrete numbers in a long range plan, because the department doesn't own the lands they're not going to commit to do anything. And so I just recommend to people that they show up so that they get some of this information before the audit gets done, or the budget gets approved, or whatever.
CHAIR: I 100% agree with you on participation and also the Long Range Plan, because a lot of work was done on that and it's a quality document, as is the budget—
AUDIENCE MEMBER: And it’s a living document, so it’s going to be looked at.
[Chair asks for a motion to accept the audit as presented. The motion is seconded and is carried unanimously and the meeting is adjourned.
AUDIENCE MEMBER COMMENT (not on record, because it was made after adjournment):
I want to commend the board. This is only the second time I've attended a board meeting. The other one was very disappointing, and I came away from that board thinking that the board was dysfunctional, and that's not what I saw tonight. I saw a board that is working well, and I commend the board, and keep the good work up. Thank you.