Town cuts costs, draws on reserves to hold 2020 Operating Budget in check

Town of BWG proposes an Operating Budget that is .041 percent lower that in 2019

Bradfrodtoday.ca
December 2, 2019
Miriam King

Cuts to the proposed 2020 Operating Budget, the deferral of some expenditures, and increases on the revenue side resulted in BWG Town Council recommending approval of a budget that represents not an increase, but a 0.41 percent reduction from 2019.  

The increase in the overall municipal portion of the property tax bill, once the annual Special Capital Levy is added in, comes to 3.31 percent. Combined with the actual or estimated increases in policing, education and county levies, that translates into a 3.55 percent increase in property taxes for local homeowners.

For the average BWG home, assessed at $481,892, it will mean an additional $171, year over year.

At the start of the process, the town was looking at a 1.91 percent hike in the municipal portion of the taxes, and a 4.37 percent overall increase in the combined property tax bill. 

It took two full days of 9-to-5 debate before councillors finalized not only the 2020 Operating and Capital budgets, but preliminary budgets for 2021 and 2022.

This was the first time that the town followed the three year format, which led to extended debate before the session wrapped up because of a simple fact: Cuts to the 2020 municipal tax rate had the effect of pushing up the rate in subsequent years.

In the end, councillors, during the special meeting of Committee of the Whole, reached the revised increase only by applying all of the Modernization Grant monies to the budgets, $159,000 in each year -- and reducing the annual increase in the Special Capital Levy for the 2021 budget year.

The Special Capital Levy was established to build a significant reserve for the future replacement of existing infrastructure. The town has increased the Special Levy by one percent every year -- with the result that in 2020, the levy has reached over $5 million, or seven percent of the total property tax bill.

Coun. Gary Lamb opposed slashing the Operating Budget while continuing to increase the Special Capital Levy. “We don’t touch that, but we’re beating up on our every-day,” he said.

Deputy Mayor James Leduc opposed any reduction in the Special Levy. “We’ve got the Town Hall to build. That’s $107 million,” he said.

He was referring to a $107,770,000 proposal to redevelop the lands surrounding the old Bradford Community Centre at 125 Simcoe Rd., which includes a new multi-million-dollar administration centre, bandshell and other amenities. The town has applied for $54.7 million in provincial-federal grants for the large-scale project, but is also looking at over $46 million in debt, if it goes ahead.

“I have to disagree with the Deputy Mayor. People are worried about the tax bills they have,” replied Mayor Rob Keffer. He urged a reduction in the annual increase in the Special Capital Levy in 2021, at least, to offset taxes.

“I know we have things to build, but do it over time,” agreed Coun. Peter Ferragine. “Otherwise it’s just going to keep jacking up percentages, and the Operating Budget keeps going down.”

Leduc continued to argue in favour of maintaining the increase in the Special Levy. “It’s a million dollars every year. It was foresight thinking,” he said, adding, “I’m prepared to cap it in 2024” but not before. “There is a cost to do stuff. We don’t have the growth we had in the past… It’s all about a financial plan.”

Leduc was supported by Director for Community Services Terry Foran, who warned, “We’re outspending the contributions to reserves” -- something that balances out if the town continues to increase the Special Capital Levy through 2022.

But the majority of council supported a cut to annual increase for 2021 -- approving a levy of about $5.51 million in 2020, just under $5.84 million for 2021, then back up to $7.197 million in 2022.

“It’s just moving the snowball down the road,” warned Goodfellow.

“We don’t know enough details about 2021, 22. You guys don’t know the revenues,” said Coun. Gary Baynes, suggesting that if the town exceeds the one percent growth in assessment predicted for 2021, it will ease some of the tax pressure.

Other reductions came from applying a $300,000 surplus from 2019’s unfilled staff positions, to the 2020 budget. Coun. Gary Baynes had originally proposed $483,000 from an apparent $604,000 surplus, but his math was corrected by Treasurer Ian Goodfellow, who warned that there are still a number of “significant year-end adjustments to come,” regarding sick pay, vacation pay and overtime.

The Strategic Initiatives Fund, established with past savings on insurance premiums, was tapped for $200,000 per year in each of the next three years, leaving $80,000 in the account.

Among the decisions:

Human Resources and Information Technology were approved for co-op students in 2020, at a cost of $11,835 each.

A request from Fire & Emergency Services for an additional $40,000 per year to cover the actual cost of remuneration for volunteer firefighters was cut in half, to $20,000. “If we go over, I have to go over,” warned Fire Chief Kevin Gallant. “It’s underfunded.”

Leisure Services was asked to generate an extra $10,000 in revenues in 2020 from special events, which will include increasing the vendor rates for Carrotfest from $75 to $100 for non residents, and another $50,000 through sponsorships and other sources. One issue: a planned four week closure of the pools at the Leisure Centre, for maintenance, is expected to reduce leisure services revenues.

Council agreed to hire an event programmer, at a salary of $63,017, after Director of Community Services Terry Foran explained that existing staff have taken on the burden -- successfully increasing sponsorship revenues for special events by 60 percent while eliminating the commission previously paid to a contract position - but “we only have so much we can fill… We need that support and those hours.”

Council declined to increase Leisure Services’ budget for facilities by $24,700 for contractual services, $30,700 for materials and supplies, or $74,400 for repairs and maintenance -- even though the request reflects actual expenditures in 2019.

Foran noted that the Leisure Centre is now eight years old, and the town owns and operates other aging facilities -- but Deputy Mayor Leduc opposed any increase. He called last year’s repairs “one-offs,” and instead suggested Foran approach council to ask for money for overages, through the Emergency Procurement budget. “Deal with it through requests,” Leduc said.

Council approved $32,200 to hire a “creation specialist” at the library, on contract -- someone who will help set up a ‘Hacker-Maker’ space in Bradford, with 3-D printers and laser cutters, similar to the Innisfil IdeaLAB, and offer community programming for all ages. Also approved: $18,600 for custodial services.

Outgoing library CEO Terri Watman came to the meeting to support the library budget requests and explain the transformation of the current computer lab into a ‘creation space.’ “We’re actually really behind” in Maker-Hacker culture, Watman said, noting that not only Innisfil but York Region and Midland offer similar spaces. “We’re hearing this from the community: they want this,” she said.

Watman successfully defended the request for custodial staff, noting that on average 165,000 people come through the library’s doors in a year.

The library also asked for $8,300 for a Library assistant in 2020, and for the reinstatement of $10,000 in part-time hours -- a budget line that was “temporarily” removed in 2017, when a position was unfilled, but was never restored.

Deputy Mayor Leduc asked Watman to choose either the assistant, or the part-time hours. Watman opted for the $10,000 -- but had to defend the request, as Leduc continued to ask that it be deleted.

She had less success with a $7,800 proposal for mobile WIFI Hotspots (capital and operating), at least until the library board reconsiders its decision to provide the service for free. “Taxpayers’ dollars to give people internet access to use at their own place? Can’t they pay a user fee for using it, so the regular taxpayer doesn’t have to pay for it?” asked Coun. Peter Ferragine.

“Sorry to be negative on it. I think it’s a great thing, but…” said Coun. Gary Baynes.

Council cut $50,000 from the annual $250,000 contribution to the Community Improvement Plan Reserves, in part because the existing “total pot” for CIP grants currently stands at $1.19 million.

At the end of the day, council recommended approval of a 2020 Net Operating Budget for municipal and library of $23,786,209 (down from the original $24.22 million), Net Operating of $24,887,437 in 2021 and $25,845,286 in 2022; and water/wastewater budgets of $13,687,282 in 2020, $14,128,431 in 2021 ad $14,455,210 in 2022.

The recommendations are expected to be approved in the next regular meeting of council.