Councillors Dawn Luhning and Kim Robinson butted heads about whether council or administration should be suggesting what to cut from the 2023 operating budget to make the tax hike easier on ratepayers.
City council had asked city administration to find items to eliminate that would equal one percentage point or $330,701 so that the proposed mill rate hike — 5.20 per cent at the time — would be lower.
Reasons for tax increase
There are two issues affecting revenues for 2023, explained finance director Brian Acker.
The first is council used one-time funding in 2022 by pulling $500,000 from the equipment reserve and $164,990 from the solid waste utility, which is no longer available. Second, city hall expects building permits to decline by $400,000.
Both are equivalent to 3.19 percentage points of municipal taxation, he continued. Meanwhile, the revenue decrease is why the mill rate increase — composed of the municipal tax hike and police request — was 5.20 per cent.
One positive, Acker said, is that the fire department has reduced its expenses by $1,078,260 since 2015 and increased revenues by $609,892, a net gain of $1,688,152.
“We would be in a significantly different position with the mill rate if we did not have that (savings),” he remarked, adding in comparison, the police service’s funding request has increased by 1.5 times since 2015.
Councillors’ concerns
One issue Luhning had with Acker’s report was how he compared the police budget to the fire budget, areas she thought were not comparable. Furthermore, she thought city hall was hinting that the police service’s request was too expensive even though council has discussed crime and homelessness regularly.
“And I think we need to be very careful when we do that (comparison),” she said.
Luhning pointed out that when she became a councillor in the early 2000s, the police budget was limited to 23 per cent of the city’s operating budget. It has never exceeded that limit; in 2023, it represents 20.3 per cent.
The city’s revenues are rising next year to $55.7 million from $54.5 million and expenses are increasing to $57.3 million from $54.5 million, she continued. She was in disbelief that no one could find any efficiencies or savings to lower the municipal tax increase by two or 2.5 per cent.
The economy will be weak next year, which puts pressure on residents’ discretionary income, so council must be careful when raising taxes, Luhning said. She understood that the city was facing similar pressures but didn’t believe the $65 infrastructure levy was necessary.
“And I find it interesting that administration wants us, as the elected officials, to tell them what to cut. You need to tell us what we have to cut out of the budget to bring it down into the tax rate that you want … ,” she continued.
“So, what’s the difference at budget if we’re to tell you (to) cut this out of parks and rec (or) cut this out of engineering … that you wouldn’t tell us in July to stay out of the operations of (the) business?”
In response, Robinson said he thought the chart with the police and fire budgets was a “linear correlation” with what administration wanted council to know and nothing nefarious. More worrisome, though, was Luhning’s comment that council should tell administration what to cut.
“These are professionals. We’re the policymakers. We’re not going through to look for a few dimes here or there … ,” Robinson said. “Quite frankly, if I was a long-time councillor and I didn’t have any ideas (of what to cut), I’d be a bit embarrassed.”
City administration did what council asked and suggested items that equate to a one percentage point reduction, said city manager Jim Puffalt. The items are ones that neither city hall nor the community want.
Afterward, meeting chairman Coun. Jamey Logan reminded councillors to be more civil with each other.
