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Mayor Column - October 17, 2014

City Council prepares to tackle new operating budget

This Monday, Oct. 20, City Council members will meet as Finance Committee for what will, in effect, be the formal launch of our work to craft a new operating budget for the City of Lethbridge for the next four years.

One of the goals in City Council’s Strategic Plan is to demonstrate financial stewardship. Some of the ways we intend to accomplish that are by balancing resources with needs, which is seldom an easy task, and by reviewing service levels in order to maximize the value that you, our citizens, receive for your tax dollars. We also want to provide opportunities for you to better understand what you’re actually getting for your money, whether it’s in taxes, service fees or utility rates.

On Monday, the City Manager will table a draft operating budget which, in broad terms, will spell out the financial resources required to continue providing the existing level of municipal services as well as list a number of proposed new initiatives for Finance Committee to consider as possible enhancements to existing levels of service. Our task as Finance Committee, and ultimately as City Council, is to develop a budget that reflects the values of the community in the financial priority given to an array of municipal services.

This poses significant challenges. As financial stewards of the City, Council members work closely with City administrators to control the inflationary costs of existing services. Early indications to Council this year were that annual tax increases of close to four per cent might be needed starting in 2015, just to maintain existing service levels. We find that figure unacceptable, and so we are doing everything we can to reduce it. When the draft budget is presented to Finance Committee on Monday, we will find out what progress has been made in reducing the projected tax increase.

In September, we launched an interactive web-based tool that outlines how your property taxes are used and allows you to simulate the financial impact of changing funding allocations to a variety of service areas. I encourage you to check it out at: www.lethbridge.ca/budget. You can also provide comments electronically that will be compiled and forwarded to Council members in early November.

As Council, we are doing this budget work within the larger context of reductions or changes in federal or provincial funding for local social service agencies. As a result, Council is facing the challenge of raised expectations of community agencies that are doing extremely valuable and worthwhile work in our city. One significant challenge is the fact the provincial funding for Family and Child Social Services has remained static for several years. On an 80:20 provincial-municipal ratio, this funding flows to various local service agencies at the front lines, which are being squeezed financially because their costs are rising but their funding isn’t.

Meanwhile, other groups are seeing overall funding carved into smaller portions among a growing number of agencies. At the same time, we know there are citizens in our city with very limited financial capacity to absorb tax increases. It will be impossible for us to satisfy everyone’s expectations.

Unlike federal and provincial governments, whose income tax revenue rises automatically with increases in average salaries and wages, our city’s only means of dealing with rising costs, other than service level reductions, is to implement corresponding increases in property taxes or utility rates.

The four-week period after the draft budget is tabled will be your opportunity to find out what’s in it and tell us whether or not you think it reflects what you think the financial priorities of the City ought to be. We want to hear from you before we begin our budget deliberations on Nov. 17, and so we’ll be hosting budget open houses in the early evening at city hall on Oct. 22 and 23. In addition, we’ll be hosting a public meeting Nov. 3 at 5 p.m. in city hall where citizens can make presentations to us regarding the draft budget.

Besides tax-funded operations, the City of Lethbridge also provides an array of utility services that are funded from the rates our residents pay on monthly utility bills rather than property taxation. These utilities include electric, water and sewer, and waste and recycling services. Water and sewer rates are forecast to increase 2-2.5 per cent in 2015, which is equivalent to the rate of inflation.

Residential electric utility rates are forecast to increase about 4 per cent in 2015, which would add $4.89 to the average monthly electric bill. Despite a proportional decrease in the municipal distribution charge, the main factor in electric rate increases continues to be rising transmission fees charged by the province and collected as part of your monthly electric bill.

Clearly, the budget process will be challenging for Lethbridge City Council. We welcome the input of our citizens in this process.

Meanwhile, we are thrilled that Lethbridge has been chosen to host the 2015 Skate Canada International competition a year from now. It will be a treat for our city to host this world-class competition, and we look forward to welcoming the competitors, coaches, officials, support staff and spectators from Oct. 30-Nov. 1, 2015. I know they will have an excellent experience in Lethbridge.

Lastly, I want to thank people for their patience this summer and fall with traffic disruptions that have been necessary during important road maintenance and enhancement projects, such as those along 28 Street North, 26 Avenue North, 43 Street North and Garry Drive West. By policy, City Council is committed to taking care of the municipal assets we have. These assets include roads, buildings, and underground utilities. By replacing or updating aging infrastructure, we help limit the need for emergency repairs and the inconvenience of unexpected service interruptions.

Mayor Chris Spearman

October 17, 2014