City councillors have pulled another rabbit out of the hat. The budget for this year has met the target without any serious cuts. City staff did all the work, making up the $520,000 difference that existed by finding bits of extra money here and there that wasn’t known beforehand or expenses that don’t have to be made. The budget committee can claim little credit; they haven’t really done anything but listen to departmental presentations.
Residents will face an increase of about 1.75% on their tax bills later this year, which on the surface doesn’t look too bad. After all, that’s about the rate of inflation – and if the cost of bread and milk and everything else can rise by that much, why not city services too.
But that’s not the whole story. The 1.75% is the average impact on residents, after factoring in property assessments; many will pay more. The tax levy, which is the total amount the city will actually collect in taxes from residents and businesses, or the real cost to us for city operations, will still go up by 3% over last year. That’s nearly double the rate of inflation. Salaries and benefits are increasing by more than 4%. It would be nice if the city itself was growing that much, but it’s mostly just expenditures and they’re growing faster than revenues. Even then, there’s still not enough available for long-term investment in equipment and infrastructure.
That situation cannot be sustained. Something will have to give, sooner or later.
But, it looks like, once again, it will be later. The budget committee chair, Denis Carr, signalled he is satisfied with the result. Last Friday, he asked for a motion to adopt the budget as is and pass it on to full council for approval. That was really a ploy to force a ceiling on spending before outside agencies are discussed and his colleagues chose instead to keep options open. But the message was clear; with the target now met, the pressure to find more savings is off. Sustainability issues are now effectively off the budget table.
City staff have made their hard choices to meet the budget target, so it’s now up to councillors to do the same with outside agencies, which are on the table this week. Some 26 agencies are seeking nearly $800,000 in cash or in-kind services. That’s about $200,000 more than last year and includes 12 new requests. The aim is to fund only up to last year’s amount. That would mean agencies will either get less than what they asked for, or some will go away empty-handed. Most are not seeking any increases over last year, a stark contrast with the city’s 3% increase in spending.
Some of their stories tug at the heartstrings, so council will look like a real Grinch if funding is not approved. So, expect to see some emotion around the table as that debate unfolds. Watch Gerry Samson struggle with his call for a total tax freeze – while he votes these agencies everything they’ve asked for, as he promised each one during their presentations. The challenge will be keeping the lid on.
This was billed as a very tough budget, but was it, really? Councillors have hardly broken a sweat. There’s no blood on the floor; no services have been cut or compromised; not much has really changed. They haven’t dealt with any of the issues that were supposedly making it so tough. The budget contains most of what councillors were given on day one.
All the hard issues that might improve the situation have been “parked” for discussion after the budget is done, so they’ll have no impact on this year’s tax. But now that the pressure is off, will they really have the incentive to follow through and make the hard decisions? Or will we see a repeat next year? That’s my concern because, sooner or later, they’re going to run out of rabbits.