Every year, as required by Provincial legislation, the District adopts a Five Year Financial Plan Bylaw which serves as the district's budget. This includes Operating Budgets and Capital Project.
Each year the municipality is faced with the challenge of balancing the budget.
While a municipality can incur a debt to pay large capital projects it cannot borrow or mortgage to fund day to day operations the same way that other levels of government can. This is a key difference as it means that the municipality must rely on revenue sources to cover off all expenses for the year.
Careful review is used to balance the level of services expected by the community with ability to pay through reasonable taxation and user fees. In doing this the district moves towards its Strategic Planning Goals, which closely relate to the District's Integrated Community Sustainability Plan (ICSP).
Long Term Financial Planning is the process of aligning financial capacity with the community vision and long-term service objectives. This is achieved through development of a set of financial principles and an effective linkage to the community vision (Official Community Plan), Sustainable Highlands Plan and Asset Management Plan. It is an essential tool for financial decision making. It provides information to guide decisions about the mix and timing and outlays on operating activities, renewal and replacement of existing assets, future additional assets and the associated funding implications. It can be used to assess the expected future impact of financial decisions and to manage risks.
The District of Highland's Long Term Financial Plan, which is part of the overall Asset Management Strategy, integrates with District operations, and aligns the District’s financial capacity with the community vision and long term service objectives. The Plan will form a basis for preparing the Five Year Financial Plan each year.