Municipal Budgets Challenging

Jan 30, 2019 | News, President & CEO News Articles

The City of North Bay Budget process is underway with the water and sewer side of things almost completed during the last meeting.  There was much discussion amongst the Councillor’s as to the proper use of reserves and budget surpluses.  By the end of the meeting, a consensus was achieved however, it was not unanimous.  Differing opinions and discussion regarding these budgetary concerns is healthy and required to make proper decisions, as the budget process moves forward.  There is no doubt that these topics of discussion will not end with the wrap of the water and sewer budgets.

Late last week, Deputy Mayor Tanya Vrebosch announced the starting point for this year’s operating budget at just under eight percent, prior to any adjustments or cuts.  This will be where the subject of the reserves and surpluses will begin again.  It is not easy to put forth a budget at this starting point and will prove to be even more difficult to get it passed through Council over the next number of weeks.  The Deputy Mayor has indicated that one of the primary reasons for the increase, is due to the use of surpluses and reserves over the past term. 

The use of one-time funds to offset increasing budgetary spends, have only given the appearance of low tax increases for the past years, as detailed in her Nugget interview last Friday.  Funds utilized to offset present year expenditures have this nasty habit of compounding each year and only seem to become important or relevant when you try to wean off them. Past Council’s had been cautioned by the CFO as to the future effects of this type of support however, those warnings were not heeded.  It is a vicious circle and the writer is not a fan of these types of artificial props to our annual tax bill. 

It does catch up to us eventually and kudos to the Budget Chief for recognizing this must stop.  In saying that, the budget must go on and there are significant ask’s before Council in this 2019 budget process.  Funding requests from internal and external stakeholders represent a sizeable portion of the increase proposed but it also recognizes the utilization of one-time funds in the past.  As significant as the increase that has been proposed, the asks will need to be assessed and ranked with Council’s priorities for the upcoming term.  If the goal for the City is to expand its tax base and create employment, Council is going to have to make hard decisions regarding strategic investments, to accomplish the same.

Peter Chirico is the President & CEO of the North Bay & District Chamber of Commerce.