Coun. George Maroosis, right, explains his reasoning for supporting the approved 2.17 tax levy increase on Monday night after Coun. Mike Anthony, left, voted against the spending plan. PHOTO BY LIAM BERTI
The City of North Bay finally has a spending plan for 2015.
Four months of specialized meetings and endless brainstorming sessions came to a head on Monday night as City Council passed the operating budget by a 7-3 vote.
Moving forward then, the 2015 operating budget is set at just over $84.6 million, $79.3 million of which will fall on the taxpayer for this year’s levy, up 2.17 per cent over last year.
After city staff originally presented what was deemed to be a “realistic and responsible” levy increase of 5.88 per cent, City Council and chief administrative officer Jerry Knox managed to find close to $2 million of savings over the past few months.
Most notable of those line items include reducing capital spending by $1.2 million, dipping into their reserve tax rate stabilization fund for $390,000, and setting an annual savings target of $200,000 for Knox to find.
The city will also be enacting a winter maintenance service level reduction, cancelling the culvert replacement program, delaying the opening of West Ferris Arena, and increasing transit rates, to name just a few of the over 60 items discussed in the meetings.
However, there will also be enhancements to areas like the city’s economic development and transit, for example.
“I heard six per cent, I heard zero per cent and I heard everything in between,” said Mayor Al McDonald. “I heard 60-80 different suggestions around the table and I can tell you it was a give-and-take by just about everyone for a consensus budget, and that’s exactly what this is.”
While all of the new cuts were reached by a consensus vote, some councillors seemed skeptical as to whether the 2.17 per cent increase would garner the minimum required votes as late as last week.
In the end though, Mike Anthony, Mark King and Tanya Vrebosch were the minority who voted against the budget on Monday night.
Anthony said he thinks more could have been done in staffing efficiencies and cutting infrastructure spending, King felt they should have echoed Sudbury’s use of reserves to ensure a tax freeze, while Vrebosch said she thinks they are setting themselves up for failure.
“I feel that this budget is too tight and we saw the affects of a budget that was too tight last year,” said Vrebosch. “I do think we are going to get ourselves back into trouble again this year.
“We are making decisions without a plan and basically throwing our financial policies out the window,” she added.
But, while the preliminary plan has been put in place, the challenges are far from over.
The approved budget assumes Knox will be able to find $200,000 of findings before the end of the year, while also taking the one-time $390,000 payment into account. If neither target can be found in this year’s budget, council will be facing an automatic shortfall in 2016.
The city is also expecting to have their portion of Ontario Municipal Partnership Funding cut by roughly $500,000 next year.
And with just $10.5 million left in their reserve funds, the pressure is on to limit the damage to the rainy day accounts after having to draw on them quite frequently in recent years.
“We are tasked right now with $1.1 million in unidentified savings that we need to find over the course of the next year,” said Coun. Chris Mayne. “But I do think there are still ways that the city will become more efficient and I look forward to working with everyone over the next year to find those savings.”
Last week, the city’s chief financial officer, Margaret Karpenko, said the new-look budget is slightly optimistic and comes with some inherent risks.
But for now, it appears as though council seems comfortable with those risks until they sit down next Fall to start the 2016 budget process.
“There’s a lot expected from the Mayor and council in building a city and we all need to work hard and together, and that means lots and lots of hours, which means a lot of sacrifices,” McDonald said after the meeting.
On top of the $84.6 million total, council also approved the District of Nipissing Social Services Administration Board levy of $11.2 million, Humane Society budget of $351,900 and the North Bay Police Services Board budget of $17 million on Monday.
City staff will now switch their focus to tax policy implementation, which they hope to table for council in two weeks' time. From there, the policy structure will move through the committee level and council before tax bills are issued for the first week of June.
But ultimately, individual tax assessment could vary far from the 2.17 per cent overall increase.
The budget vote also came on the same night that council authorized using reserve payments to address the remaining 2014 deficit of just over $1 million.
The initial 2014 deficit of some $2.4 million was cut by more than half after the city found savings under Knox’s direction and from unexpected revenues at the end of the year.
Check BayToday for more on balancing the 2014 budget deficit soon.
@BertiLiam
