Improvement District History & Powers

Improvement districts are incorporated public local bodies governed by a board of elected trustees. Improvement districts provide services such as water and fire protection services (also known as "objects") for the benefit of landowners within their boundary.

Improvement districts are not the same as municipalities or regional districts, as improvement districts may only provide the services authorized in their letters patent.

Improvement District History

Improvement districts vary considerably in size, from small subdivisions to larger communities and are usually located in rural areas of B.C. Some improvement districts service less than 10 landowners and the largest serves thousands of landowners.

The first improvement districts were created in the 1920s to publicly manage several large irrigation systems in the Okanagan Valley. Improvement districts were created through a provincial Order in Council that issued a legal instrument known as letters patent.

At that time, improvement districts filled a service gap by providing some basic local services in areas outside municipalities. When landowners required only one or two services, improvement districts were often the most practical service delivery option.

Each improvement district was created through when the majority of landowners in a community petitioned the B.C. government to incorporate a public local body to deliver one or more services, for example water, to the community.

Improvement districts were gradually given responsibility for services other than water. For example, fire protection began to be manged by some improvement districts in 1945.

In the 1960's, regional districts were created and provided another more flexible option for service delivery in rural areas. By that time there were more than 300 improvement districts providing a variety of services (e.g. sidewalks, streetlights) to landowners across the province.

The last improvement district was incorporated in 1995. Over the years, many improvement districts have either incorporated as municipalities (some larger improvement districts) or have transferred provision of their services to municipalities or regional districts. This process is called "conversion."


As local governments, regional districts are now the most effective way of providing broad expanded rural area services. Regional districts are not limited to specific services in their letters patent; provide both land use and service decision-making under one body; have broader administrative and financial tools for service management; are governed by officials elected directly or indirectly by electors, not just landowners; can borrow at lower interest through the Municipal Finance Authority; and are eligible for provincial and federal grants.

The B.C. government does not generally create new improvement districts, add new service responsibilities to existing improvement districts or consider a major boundary extension to an existing improvement district where there is a local government willing and able to provide the required service.

Powers

The improvement district's letters patent, applicable sections of the Local Government Act, and other relevant provincial statutes outline the powers, obligations and limitations of improvement districts and their board of trustees. Examples of other statues include Land Title Act, the Drinking Water Protection Act for improvement districts with a water service and the Fire Services Act for improvement districts with a fire protection service.

The board of trustees exercise powers for the improvement district by passing resolutions and bylaws (some powers, like taxation, may only be exercised by bylaw).

Improvement districts share some characteristics with municipalities and regional districts, such as the method of incorporation and the powers to borrow, charge and regulate services. However, improvement districts are different from municipalities and regional districts in several key ways, including the election of improvement district trustees solely by eligible landowners, rather than the electorate at large. Also, improvement districts do not have the broad powers granted through legislation to municipalities and regional districts.

Because of these differences improvement districts are not eligible for lower interest borrowing through the Municipal Finance Authority of BC or provincial infrastructure planning and capital grants, although regional districts may apply on behalf of improvement districts within their boundary.

Local Government Act

The Local Government Act provides authority for the creation of improvement districts. Under section 675, the Lieutenant Governor in Council, by letters patent, has the authority to incorporate an area of land with two or more parcels and its owners into an improvement district.

Under the legislation, improvement districts' powers include:

  • Provide, manage and operate the improvement district's services
  • Tax property
  • Charge tolls for services
  • Regulate services
  • Acquire and dispose of property
  • Assess land and improvements (for example, buildings) to establish the basis for property tax imposed to pay for services
  • Borrow
  • Levy capital expenditure charges
  • Enter into contracts

Some of the obligations improvement districts have under the legislation include:

  • Establish, by bylaw, two officer positions - for corporate and financial administration (two or more officer positions can be held by the same person)
  • Provide two weeks notice to the public of the date, time and place of the annual general meeting
  • Hold a public annual general meeting where the audited financial statements are presented to the landowners
  • Submit audited financial statements to the Inspector of Municipalities by May 15 each year
  • Establish a meeting procedure bylaw
  • Register bylaws with the Inspector of Municipalities in order for them to be effective, unless the registration requirement has been exempted by regulation

Some limitations that apply to improvement districts under the legislation include:

  • Only providing services inside their boundaries, with the exception of fire protection where there is a mutual aid agreement in place
  • May impose penalties for regulation violations, but may not levy cash fines

Some of the limitations that apply to improvement districts directly reflect that they are local public bodies that provide specific services, not general governance.

Improvement districts are not able to:

  • Borrow from the Municipal Finance Authority however, in certain circumstances they may request that a regional district borrow on their behalf
  • Apply for provincial grants however, in certain circumstances they may request that a regional district apply on their behalf

While the Local Government Act provides authority for improvement district board powers, obligations and limitations, an improvement district's letters patent may also provide for specific authorities or obligations (for example the number of trustees on the board of trustees).

Learn more about improvement district governance:

Letters Patent

Letters patent describe the unique characteristics of the improvement district, such as its geographic area (boundary), the objects (services) it has the authority to provide, the number of trustees on the board of trustees, the timing of the annual general meeting and voter eligibility.

Letters patent list the services that an improvement district may provide. The board may decide not to offer a service that is in the letters patent, and it cannot provide a service that isn't in the letters patent. Letters patent and bylaws enable improvement districts to pay for services through taxation or tolls and other charges.

Letters patent can be customised to meet the specific needs of an improvement district. For example, letters patent can provide additional requirements to be a trustee. However, as provincial legislation takes precedence over letters patent some provisions may no longer apply. For example, while some letters patent state that a landowner must be 21 years of age or older to vote in an improvement district trustee election, the Local Government Act sets the minimum age at 18 years.

Letters patent can be amended to make boundary changes and have been amended to reduce the number of trustees.

Each improvement district must have a copy of its letters patent available for reference by trustees, staff and landowners who wish to view them.