Improvement Districts Boundary Changes & Dissolutions

Improvement district restructure is the process for making governance, function, and boundary changes to improvement districts. The B.C. government does not generally create new improvement districts, add new service responsibilities or consider major boundary extensions where there is a local government willing and able to provide the service.

Boundary Changes

The boundary of an improvement district marks the geographic limit to which its powers to provide service and to impose taxes, tolls or other charges to recover costs extends. The only exception to this rule applies to improvement districts that operate fire departments where, under certain circumstances, service can be provided outside the boundary.

Improvement district boundary changes can occur for several reasons. For example, a nearby property owner outside the boundary may wish to receive the water service provided by an improvement district. Alternately, a boundary reduction might occur when a municipality extends its boundaries to include part of an improvement district.

Converting & Dissolving an Improvement District

Regional districts are typically the most effective way of providing rural area services for various reasons, including that they provide both land use and service decision-making. The B.C. government encourages existing improvement districts to build positive relations with the local governments in their area and to consider whether their services could be better provided by a local government. When an improvement district ceases to meet the needs of its landowners, it may be eliminated in one of two ways -- by conversion or by dissolution.

Conversion

Conversion means the transfer of services or functions of an improvement district to a local government (a municipality or a regional district). The existing operation and administration of an improvement district's services, including all of the assets, liabilities, obligations and bylaws of the improvement district are transferred to the local government taking over the service. In most cases, that local government continues the service as it was, with the assets, liabilities and obligations remaining with the properties that were within the improvement district boundary.

Reasons for conversion include:

  • Needs of the improvement district outgrowing its capacity (for example, difficulty finding volunteers to serve as trustees)
  • Pressures for a closer connection between services and land use planning and regulation - for example, in an area dealing with development pressures
  • Interest in a more robust governance structure that provides access to administrative and finance tools such as more favourable insurance rates, resources and expertise, cost recovery methods, borrowing rates or grants from senior governments
  • Greater accountability for residents through a governing body elected by electors, not just land owners
  • The community containing the improvement district is incorporating as a municipality (an improvement district cannot continue to exist in a new municipality)

The B.C. government generally supports improvement district conversions where there is evidence of support from the board of trustees, the local government that will take on the services, and the landowners. Typically, the process follows these steps:

  • The relevant regional district board or municipal council, along with the improvement district board of trustees, notifies the Ministry of Municipal Affairs and Housing of its support for conversion
  • The local government studies the feasibility of conversion to fully understand the costs and governance considerations in maintaining the service for the long-term benefit of local residents
  • Landowners have an opportunity to review the conclusions of the study and provide input on a recommended course of action
  • Once all parties have understood the implications of conversion, the provincial Cabinet may choose to authorize the elimination of the improvement district, and transfer all assets and liabilities to the local government that will take on the services.

Dissolution

Dissolution occurs in the rare instance when the objects of the improvement district are no longer feasible, and the B.C. government and the improvement district agree that provision of these services is no longer viable. This might occur where, for example, repair or upgrade of a water system is more costly than joining a nearby system, or a majority of property owners have already dug wells.

Dissolution involves the dispersal of assets and liabilities among ratepayers, and the disestablishment of the improvement district as a legal body. This may involve a study to determine if the service should be continued through a regional district or municipality.

Role of the B.C. Government

Improvement district restructure involves amending or repealing an improvement district's letters patent. Amending or repealing letters patent requires approval of the B.C. government. Before this takes place, B.C. government staff review the request to ensure statutory requirements are met and consultation with affected stakeholders, such as ratepayers, has taken place. An improvement district considering a restructure should contact Ministry of Municipal Affairs and Housing staff early in the process.