Council is already looking at some “daunting” numbers in its budget-planning process even though financial planning for 2013 is just getting underway.
At its first financial planning meetings Monday and Tuesday morning, council deliberated the base budget – services such as policing and fire that the city has no choice but to fund.
Due to inflationary items, contractual increases, wage settlements, and changes imposed on the city through legislation, council is facing a $713,600 increase in protective services.
Just that figure alone, if borne solely by the residential sector, would equate to a 4.75 per cent residential tax increase for 2013, however that is a preliminary calculation as the tax rate won’t be debated until February after service levels have been adjusted.
The biggest impacts to the base budget are an extra $660,335 in CUPE (Canadian Union of Public Employees), the fire fighters union, and management wage and benefit increases, as well as a $448,087 increase in the RCMP contract.
The base budget also includes an $88,000 reduction due to the loss of a roads foreman position as well as an extra $420,013 because the city has completed payments on the Community Centre, and an additional $14,500 in revenue generated from bylaw enforcement.
With the above reductions and increases, staff have a preliminary figure of a 2.89 per cent residential tax increase, barring each of the water, sewer, storm, and parks parcel taxes all remain the same as in 2012.
That would mean $1,384 in property taxes for the average home assessed at $268,000, an increase of $41 over 2012.
Coun. Andy Adams said having budget planning begin earlier than usual and having the budget process split into three different sections will help mitigate a difficult situation.
“In my seven years on council this is the first time we’ve had this level of detail or opportunity before the fiscal year,” Adams said. “The numbers provided are daunting and the division of A, B, and C will do a number of things.
“First, by dealing with part A now, we’re enabling staff to move forward with plans right at the get go. Any changes can take effect at the beginning of the fiscal year.”
Mayor Walter Jakeway, who has been advocating for an earlier budget planning process for more than a year said having the budget formed by March will allow council to turn its attention toward other pressing issues.
“To have this process going on in December is a monumental change,” Jakeway said. “It will allow things to be calmer in 2013 and it will allow council to do other things. I can only see good things come out of this change.”
Adams agreed.
“I think this puts us in an excellent position to see the bigger picture,” he said while reminding his fellow councillors to think a few months down the road when making decisions.
“When you take a look at the numbers before us today,” Adams said during the first budget meeting Monday morning. “Just as being the base, it’s a 2.89 per cent increase (over last year). Then when we get to part C, anything we add onto that will add a percentage increase to that amount.”
Coun. Claire Moglove expressed concern with how high the increase over last year is before even getting into service and taxation levels, which will be part C, scheduled for February.
“If it wasn’t for the fact the payments for the Community Centre are coming to an end, it would be closer to five per cent,” Moglove said. “I think it shows how difficult it is to control the budget. We’re just starting and it’s already a five per cent increase if not for Community Centre payments coming to an end.”
As it stands now, city expenses for 2013 include: Administration ($1.8 million); Police ($8.4 million); Fire ($4.6 million); Corporate Services ($6.7 million); Facilities and Supply Management ($2.1 million); Operations ($11.4 million); Parks, Recreation and Culture ($5.9 million) as well as $3.8 million for water, $3.3 million in sewer costs and $2.7 million for the airport.