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Council tries to trim budget, but 4.3% tax hike is coming

BY BILL PHILLIPS

bill@pgdailynews.ca

They looked but they didn’t find much.

Going into city budget deliberations yesterday, some councillors weren’t comfortable with a proposed tax increase of just over four per cent. But, in the end, council added some ‘enhancements’ and approved a tax hike of 4.3 per cent.

“I’m not comfortable with the little over four per cent tax increase,” said Coun. Brian Skakun. “The Employer health tax, passes onto the taxpayers and that’s not fair. I’m concerned about the debt.”

Coun. Frank Everitt agreed.

“It’s hard to come off a 1.87 per cent increase (in 2018) and go into a four per cent increase,” he said.

Coun. Kyle Sampson said, as a new councillor, he wanted to be cautious but was concerned with the increase.

“Last year was a 1.87 per cent tax increase,” he said. “This year we’re looking at four per cent. What is this year to us? Is this a building year or is this common ground?”

Council was told the Employer Health Tax, imposed by the province to offset eliminating Medical Services Plan premiums, will account for one per cent, or roughly $1.0 million of the increase. At the opening of the budget talks council was urged by resident Eric Allen to fight the tax.

Coun. Garth Frizzell said council has fought the tax.

“We have worked hard to try and push back against that,” he said. “We’ve all stood together saying it was unfair. We asked for it to be removed from cities, regional districts, and school districts. They only removed it from school districts.”

He added that when council took issue with Finance Minister Carole James’ statement that the tax should be able to easily absorbed by municipalities, they got “push back” from the province.

Skakun zeroed in on a $1.4 million budget item to expand the city mausoleum, questioning whether deferring that would reduce the tax increase.

Kris Dalio, director of finance, explained that removing the item from the budget wouldn’t have a direct impact on real dollars in the budget because the city would borrow for the renovations and wouldn’t actually start paying that loan back until 2020. He added the city is in a good position when it comes to borrowing money.

“Our debt servicing costs just over $15 million, just over $7 million is the Fortis ‘in-out’ agreement that will (expire) in 2021,” he said. “We’re not even at the halfway mark of what we’re allowed to borrow before the province starts have an issue. We’re doing well as far as debt capacity goes.”

At any rate, removing the mausoleum item might have been tough to get past other councillors.

“With all the talks I had with seniors will continue to advocate for mausoleum,” said Coun. Murry Krause.

Coun. Susan Scott also supported the mausoleum

“Not only seniors, but a great deal of people are looking forward to having that done,” she said.

Dalio added the goal is to not subsidize the cemetery and that the business model is that it will pay for itself.

Council also zeroed in on a $2.7 million expenditure over the next two years to refurbish Masich Place Stadium. This is over and above the $4.5 million in upgrades that were completed last year.

Sampson questioned the Masich Place expenditures ($1.5 million in 2019) asking whether the extra refurbishments were necessary.

“Are some of these luxuries,” he asked. “This is a significant investment over the $4.5 million investment.”

Engineering and public works director Gina Layte Liston said the $4.5 million dealt with major components for the stadium and now that the stadium is a “premium venue” with more bookings, they are looking at upgrading field lighting, the score clock, pathways, and a fibre optic connection.

“Some of these pieces are for the B.C. Summer Games in 2022 and we would like to see them worked on over the next couple of years (rather than delay and do them all in one year),” she said. “These are requests that we’ve seen coming from different groups. It has been said these are necessary to maintain service levels.”

She said a number of the items are “integral” to the facility, such as the score clock and public address system.

“The fibre optic connection is needed to be brought in so they can do some televised events,” she said. “The electric kiosks are integral to that.”

“So we cut the fluff already and are looking at the necessities,” said Sampson.

Coun. Garth Frizzell also questioned a $578,000 item to replace the boards at CN Centre. The replacement boards have been mandated by the WHL.

After some discussion, Sampson put forward a motion, which was approved, that the city see if they can cost-share the new boards with the Prince George Cougars.

While council added slightly to the budget before them Monday, it was still lower than the 5.03 per cent hike put forward to the finance and audit committee in December.

Snow removal, depending on the weather, of course, is another area that can hit the city budget hard. For the past couple of years, the city has set the snow removal budget at $7 million, but over the past few years has overspent that amount, which it taken out of reserves. To better reflect what is actually spent on snow control, council approved budgeting $8.5 million.

Council also approved increasing the road rehabilitation budget to $5.65 million. Part of the reason for this is to include three other recurring annual projects that are part of the road network that have previously been funding through other reserves: bridges; urban lanes; and gravel roads.