Powell River City Councillors gave the first three readings to the five-year financial plan bylaw on Thursday, December 3, ushering in a new era of municipal budgeting in this community.
This paves the way for city council to give final adoption to the financial plan bylaw at its Thursday, December 17 meeting, completing the budgetary process months ahead of the traditional mid-May time period for passage.
Shehzad Somji, the city’s chief financial officer, outlined prior to adoption of the bylaw that a process of public engagement had been initiated. Two public open houses were held for taxpayers to review the five-year financial plan and to provide feedback.
“There were good questions,” he said. “We’ve also received a couple of letters from taxpayers.”
In terms of changes, Somji said in the coming year’s financial plan, there is a 1.375 per cent tax increase for the purchase of the new library building.
The city is living up to its commitment for no increases in tax rates for city operations.
There are some new or additional costs over previous years in this financial plan, including wage increases and additional protective services staffing, plus allocations for communications, live steaming of council meetings and an increase of funding for economic development.
The city will be allocating $1.4 million from its general surplus to fund the deficit resulting from these new costs, the majority of which are one-time costs.
All that will be required to finalize the financial plan process will be the tax rate bylaw, which will be presented to council in May 2016.Councillor Russell Brewer, chair of the city’s finance committee, said it was good to be finalizing the rest of the five-year financial plan at a council meeting in December rather than in May.
“One of our objectives was to give the public more time to have a look at the plan, which I think we’ve done,” Brewer said. “Occasionally in the past it has been the day before final tax rate bylaw approval in May, which is just not acceptable. This is great.”
Brewer said city councillors and staff know residential and business tax rates are high in Powell River relative to other BC communities the same size. There has been a taxation shift in the last seven to nine years from major industry to small business and residential owners that resulted in higher taxes for residents and businesses. There are a number of initiatives where the city is trying to increase revenues to help offset the increased burden.
“I’m sure we’ll see some of those succeed,” Brewer said. “If they don’t, we’ll potentially have to look at service cuts but we don’t want to go there. I’m optimistic we are not going to need to do it. We have so many initiatives at play that hopefully we’ll bring in revenues and increase the tax base so that we can maintain the services that we’ve got. I think everyone needs to be aware that we are working on that.”
Brewer said the city knows it has infrastructure gaps and challenges relating to the requirement of a new water main from Haslam Lake, a new fire hall and a new liquid waste treatment plant.
“We’re hopeful we’ll get some infrastructure funding so we can bridge those gaps,” he said. “The federal government made a lot of noise about providing infrastructure funding so we’re hopeful we’ll get some of that.”
The financial plan in this iteration speaks mostly to the city fully funding those projects, but if funding assistance from senior levels of government can be secured in the future, it will make a big difference to the bottom line, and for local taxpayers.
On the positive side of the ledger, the city will be retiring some long-term debt in 2016. This includes the Wharf at Westview, the South Harbour, the Timberlane track and the water treatment plant debt. Brewer said social programming is a new budgetary consideration and direction the city will be facing in future years.
“It hasn’t been a traditional municipal obligation but it is not being adequately funded by senior levels of government,” Brewer said. “Whether we like it or not we are being faced with it. We are trying to address those social issues.”
Mayor Dave Formosa said the city has struggled in past with the budgeting process, pushing deadlines. The goal has long been to be where council found itself at this meeting, preparing to adopt the financial plan before the end of the calendar year.
The mayor reiterated that efforts are being made to find new revenue sources for the city, in terms of collecting rents and leases from city-owned facilities, including the upstairs of the new library building, plus from dormant facilities. Efforts are also underway to attract new enterprises.
“Just the other day we had a large player come into the community, I can’t say what, where or how, but fairly significant,” Formosa said. “They are in negotiations with folks in the community for the possibility of locating here. We’ll just keep working hard to create a tax base for us and jobs to continue to grow our community.”
Council unanimously carried the first three readings of Five-Year Financial Plan Bylaw 2405, 2015.
For more information, contact:
Mac Fraser, Chief Administrative Officer