The first overview presentation of the city’s budget plan shows the city will be shifting its reliance on industrial tax revenues to a focus on infrastructure renewal.
City CAO Tim Pley presented the draft of the 2017-2021 budget plan to city council during a special public meeting on Wednesday, Feb. 1.
He noted that council will be taking a different approach to the 2017-2021 budget, in that there will be no presentations from the heads of various city departments. In council discussions, it was determined that the presentations of the previous years were not effective, and they established an “adversarial” relationship.
“It put council in a position where you had to try to shoot holes in the budget, basically, and it wasn’t productive,” said Pley.
Pley presented the overview of the budget last week, and a collaborative round table session will take place on Wednesday, Feb. 8.
“I have to tell you, it’s a bit awkward for me to stand here and talk about making cuts in various departments because I’ve been a department head, and I would not be pleased not to have the opportunity to protect and represent my department,” said Pley.
“Somebody has to advocate for them.
“And because we’re not given that opportunity for department heads to advocate, I would ask that council in our round table sessions be very inquisitive. Really find out what this kind of a budget means in terms of services.”
Going into the budget plan and strategic plan, city council and the CAO discussed three main issues that Port Alberni has faced. The first is a historical lack of growth. Since 1980, the population has only decreased. The second issue is that the city does not have adequate funding for infrastructure.
“Because we fund our water and sewer infrastructure through its own fund, we generally have adequate funding to do water and sewer replacements, but we don’t have any funding for paving and road,” said Pley. “So we’re in a bit of a tough situation where we can undertake water and sewer projects, but we can’t pave the road after we’re done.”
He went on to point out, “We are seeing streets are broken up even further with the frost and whatnot. We don’t have the money to replace those streets. And we recognize that, and we want to provide a way to fund that infrastructure.”
The last point Pley focused on was the fact that the city has a reliance on industrial tax revenues. “We’ve seen other communities who rely heavily on heavy industry tax revenues lose some of those revenues and set out to make some fairly drastic changes to accommodate that,” said Pley. “And we sense that we want to start taking some prudent steps now to reduce our operational reliance on heavy industry taxation and maybe use that money in the interim for infrastructure renewal.”
Council asked that there be a gradual redirection of heavy industry tax revenue to infrastructure reserve funds. Pley emphasized that this would not be a reduction, but a redirection.
“There’s different ways to achieve what we’re trying to do,” said Pley. “One, we could raise revenues, primarily taxes. Two, we could make some deep cuts and reduce services to save money. Three, we could take a combined approach, and that’s what I think this budget does.”
The draft budget shows the city’s infrastructure expenditures by taxation will increase by 300 percent, and there will be annual taxation increases of three percent for residential and commercial taxpayers. The city is in the final year of a five-year deal to freeze heavy industry taxation, but in 2018, the three percent increase will take place across all classes.
In 2016, $770,000 in taxation went to infrastructure. The new five-year plan shows $2.8 million going to infrastructure by 2021, for a total of almost $10 million in taxation over a five-year period that the city plans to spend on infrastructure.
“If we were to continue that approach for 12 years, we would have over $7 million from taxation that would go to infrastructure—to repair facilities, streets, water projects, sewer projects,” said Pley.
“This is very exciting, to look at this and think this is the kind of money that we would have available to invest in our community. It comes at an expense, and it relies on industrial tax dollars remaining, but I think it’s in the right direction.”
This week, council will engage with managers from various departments during the collaborative round table session. On Wednesday, Feb. 15, council will hold a town hall meeting, where they will receive input from the public. Participants can attend in person at council chambers, or by sending questions through Facebook, Twitter or email.
Councillor Denis Sauvé emphasized the importance of having the public engaged in their budget planning. “You’ve got council dealing with the budget with different departments and all that, but the key role for the public is such an essential factor in this budget planning,” he said. “So please, I’m really asking for the public to get involved in this budget process.”
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