While council members are working hard to limit 2011 property tax increases, they have come up against a couple of administration practices and city policies that hamper them in their efforts.
First there are the practices that have made the forecast budget expenditure increases appear to be smaller than they actually are. Coun. Roger Lemieux identified the first — administration found about 1.4 per cent savings in the 2010 budget. But they did not take that amount off the 2010 budget base and calculate increases on the reduced base. This would truly return those savings to the taxpayer. Rather, administration just replaced these potential savings with new spending. The second practice was uncovered by Mayor Nolan Crouse. Administration used the stabilization fund to pay for $387,000 of new expenditures rather than increasing the budget by that amount. This means that the total budget increase is approximately 5.65 per cent higher than 2010 spending. Seems to me that administration is engaging in some creative accounting in order to make the budget increase appear smaller than it actually is.
Secondly, there are policies that inhibit council from lowering the budget through cutting capital projects. One of these is the policy that capital spending (debt repayments, pay-as-you-go capital expenditures and other capital projects) is fixed at a percentage of the operations budget, or $12.4 million dollars for 2011. Council can cut projects and can decrease the amount spent on a project during the year, but all those cuts just put that money back into the pot. They do not take any money off the bottom line increase. Similarly, decreasing the amount spent in any given year on equipment replacement just puts the money back into the reserve. Another related policy is the one that deals with debt repayments. When debt repayments decrease, as they will do by about $300,000 in 2011, these savings do not go to decrease the bottom line, rather it goes right back into the same capital pool.
So what can council do to influence the outcome of the budget process?
First it can refuse to approve the business cases administration has requested. Two of these are an additional four staff in planning and seven in the police budget council might find difficult to reject. The first because council might feel threatened that the planning work it wants done won't happen unless the new planning staff positions are approved. The second is because the police are saying that St. Albert has slipped in the Safe Cities ranking. The fact is that St. Albert is the safest city in Alberta and the slip in the Macleans ranking was due to a change in calculation methodology!
Second it can analyze the expenditure lines of every department looking for increases that don't appear justified, and propose cuts. Coun. Cam MacKay did just that with several motions. He also had made an earlier motion to shift some of the capital budget savings out of the capital budget envelope and to the bottom line and another to cut salary expenditures by $250,000 (as the salary line always has a surplus due to vacancies). Other councillors have proposed to shift spending, cut some business cases and fund other business cases. All in all, a lot of perceptive questions have been asked and suggestions made giving us reason to believe that the final 2011 residential property tax increase will be lower than the initially proposed 3.6 per cent. Who knows? Perhaps Coun. Len Bracko’s motion to limit the tax increase to 1.5% is achievable!
Linda Flannery, St. Albert
