Budget 101

What exactly is a municipal budget?

Municipal staff begin working on the budget over the fall months where each department reviews activities and plans for the year ahead.

Municipal staff consider many factors while planning their budgets, including:

• The past year’s actual spending and if there is a need to adjust the operational budget
• Any new projects that require financing
• Potential new staffing requirements
• New equipment like trucks, computers, phones, tools, etc.

Budgets are “forward-looking” documents. They report a municipality’s planned revenue and the cost of public services for an annual or multi-year period.

Financial statements are “backward-looking” documents. They report on the actual resources used by the municipalities and the full cost of the services delivered to the public in that year.

Budgeting can help a municipality to manage spending and identify revenue to support their long-term financial plan.

Learn more about some commonly-used financial and accounting terms:

Operating Budget

The operating budget is the plan for the day-to-day operations at Norfolk County including salaries, materials and supplies.

The operating budget is largely funded by tax dollars and user fees, which include charges for recreation programs, water and sewers.

Capital Budget

The capital budget plans for the purchase, financing of assets or improvement of existing infrastructure such as libraries, storm sewers, roads and arenas.

Capital Assets

Capital assets include infrastructure, lands, buildings, machinery and equipment that provide long term benefits to the municipality

Infrastructure

Capital Assets that deliver essential public service to support commercial and residential activities (i.e. roads, water and sewage systems)

Reserves/Reserve Funding

An allocation of accumulated net revenue to set aside funds for future expenditures.

Infrastructure Deficit

A gap between what is required to maintain infrastructure and what funding is available. 

Budget Surplus

A budget surplus is income or receipts that exceed outlays or expenditures.

A surplus does not mean that a municipality has extra funds to spend. It could mean that a municipality that has funds reserved for future obligations.

Water and Wastewater Budget

The Water and Wastewater budget refers to the funds required for water and wastewater (sewer) services. This includes the administration costs, operating costs, and other associated costs required to provide Norfolk with these services.

Through these budgets water and sewer user fees are set for the upcoming year. The Water & Wastewater budget is funded through water and waste-water user rates.