So, the 2010 budget has been delivered.
The good news - Senior citizen tax break has increased to 20%, curbside re-cycling will commence.
The mil rate dropped 0.09. It is now 10.1 for residential tax. Most of us will be faced with a tax increase!!
Three councillors voted against the budget - Hann, Tilley and Breen. They echoed a similar theme - mil rate should have decreased more. Hann insists the city has to find alternate revenue sources and the only one is development. Tilley campaigned on voting against tax increases and Breen felt the city didn't dig deep enough in finding efficiencies.
Breen's comment is interesting when considering Mayor O'Keefe's assertion that a fine tooth comb was used to set the budget!
The 3 dissenters sounded like they were setting up their arguments for 15-story developments in the downtown.
Yes, the city does have to find revenue sources and development is one of them but it also has to be more efficient. As I have mentioned before, the Economic Development and Tourism department is one place to look as is the operations of the 3-1-1 call centre.
And of course, from what I've seen and heard so far, councillors did nothing to adjust their own pension scheme.
Overall, the budget is a disappointing document and the city could have and should have done much better.
Wednesday, December 16, 2009
Wednesday, November 25, 2009
Affordable St. John's?
St. John’s city councillors are currently in the process of setting the city’s budget for 2010.
They have invited input from citizens and organisations from within the city. I applaud them for this.
The city’s budget has almost doubled since 2000, from a budget of approximately $105 million to an anticipated 2010 budget of at least $200 million. The 2010 budget will have an expenditure increase of 10%. During these years the city has invested in infrastructure projects. This has enabled the city to create the Riverhead Waste Treatment plant and clean water initiatives such as Bay Bulls Big Pond.
We are experiencing the impact of operational costs for these major projects - $4.6 million for the Riverhead plant and increasing water taxes. It is anticipated we will face a $50 increase in our annual water tax next year. Add to this the cost of curbside re-cycling ($2.2 million) and increased employment expenses ($4.1 million), it is easy to see how the city’s budget is growing.
However the time has come for the city to take a closer look at this growth and begin to reduce the rate of expenditure growth to a level that is more akin with the inflation rate of the province. Capital projects that incur on-going operational costs have to be planned to have a minimal impact on the budget. (Next year’s budget is hit with $6.7 million from sewage treatment and re-cycling). While these initiatives are essential for the city, having them come into operation in the same year has a significant financial impact on citizens.
We are not an endless supply of income for the city. Affordability is a key issue for many citizens, especially those on low or fixed incomes. St. John’s is becoming too expensive for them. The city has to look at ways to ease the financial impact on these people. This may mean increasing the Seniors’ discount tax allowance and/or having a means-tested tax allowance that provides a rebate on their tax bill.
It may also mean the city has to look at suspending or cancelling some of their own programmes and services. The city should concentrate on its core services and review their non-core services. Non-core services such as the department of Tourism, Economic Development and Culture will cost the city approximately $2.4 million in 2010. Are there ways of achieving this department’s mandate in a more cost effective manner? A possible solution is to pass the responsibility on to Destination St. John’s and provide a operating grant to assist them with any additional resources required.
Collective Agreements with various unions are due for renewal in 2010. The city will have to keep expectations low and even ask its employees to accept no salary increases for a couple of years. Councillors can lead the way on this issue by declaring no further salary increases for themselves during the current term. City Managers should also adhere to a no salary increase policy. Is it time for a hiring freeze?
The city must also review the Municipal Plan as soon as possible. The ever-expanding city is costing more and we need a public discussion on urban sprawl versus urban density.
Most, if not all taxpayers are going to pay more taxes in 2010 than they did this year. This is because the average increase in assessments is 23%. Together with the expenditure commitments for 2010, we will be fortunate to see the mill rate drop from its current 11.0 to 10.5. And the water tax will increase.
It is time to get back to the basics. To take a deep breath and reflect on where the city has come from and where we want it to go.
We need to know how sustainable our city is. We need to set the city’s priorities.
They have invited input from citizens and organisations from within the city. I applaud them for this.
The city’s budget has almost doubled since 2000, from a budget of approximately $105 million to an anticipated 2010 budget of at least $200 million. The 2010 budget will have an expenditure increase of 10%. During these years the city has invested in infrastructure projects. This has enabled the city to create the Riverhead Waste Treatment plant and clean water initiatives such as Bay Bulls Big Pond.
We are experiencing the impact of operational costs for these major projects - $4.6 million for the Riverhead plant and increasing water taxes. It is anticipated we will face a $50 increase in our annual water tax next year. Add to this the cost of curbside re-cycling ($2.2 million) and increased employment expenses ($4.1 million), it is easy to see how the city’s budget is growing.
However the time has come for the city to take a closer look at this growth and begin to reduce the rate of expenditure growth to a level that is more akin with the inflation rate of the province. Capital projects that incur on-going operational costs have to be planned to have a minimal impact on the budget. (Next year’s budget is hit with $6.7 million from sewage treatment and re-cycling). While these initiatives are essential for the city, having them come into operation in the same year has a significant financial impact on citizens.
We are not an endless supply of income for the city. Affordability is a key issue for many citizens, especially those on low or fixed incomes. St. John’s is becoming too expensive for them. The city has to look at ways to ease the financial impact on these people. This may mean increasing the Seniors’ discount tax allowance and/or having a means-tested tax allowance that provides a rebate on their tax bill.
It may also mean the city has to look at suspending or cancelling some of their own programmes and services. The city should concentrate on its core services and review their non-core services. Non-core services such as the department of Tourism, Economic Development and Culture will cost the city approximately $2.4 million in 2010. Are there ways of achieving this department’s mandate in a more cost effective manner? A possible solution is to pass the responsibility on to Destination St. John’s and provide a operating grant to assist them with any additional resources required.
Collective Agreements with various unions are due for renewal in 2010. The city will have to keep expectations low and even ask its employees to accept no salary increases for a couple of years. Councillors can lead the way on this issue by declaring no further salary increases for themselves during the current term. City Managers should also adhere to a no salary increase policy. Is it time for a hiring freeze?
The city must also review the Municipal Plan as soon as possible. The ever-expanding city is costing more and we need a public discussion on urban sprawl versus urban density.
Most, if not all taxpayers are going to pay more taxes in 2010 than they did this year. This is because the average increase in assessments is 23%. Together with the expenditure commitments for 2010, we will be fortunate to see the mill rate drop from its current 11.0 to 10.5. And the water tax will increase.
It is time to get back to the basics. To take a deep breath and reflect on where the city has come from and where we want it to go.
We need to know how sustainable our city is. We need to set the city’s priorities.
Sunday, November 22, 2009
No Toll Road
Because of the agreement between the province and federal government on building and extending Gushue Highway, the city will not be able to toll the road.
Mayor O'Keefe had floated the toll idea earlier (see previous post), so the citizens of St. John's will now have to bear the maintenance costs of the highway.
Estimated annual costs is $700,000.
The road is expected to be completed in 2011.
Another impact on our taxes here in the city.
Mayor O'Keefe had floated the toll idea earlier (see previous post), so the citizens of St. John's will now have to bear the maintenance costs of the highway.
Estimated annual costs is $700,000.
The road is expected to be completed in 2011.
Another impact on our taxes here in the city.
Tuesday, November 17, 2009
Gushue Highway Maintenance
Mayor O'Keefe is threatening to charge a toll on the extension to Gushue Highway and charge the residents of Mt. Pearl for using the road. This comment emanates because Mt. Pearl has, once again, informed the city it will not contribute towards the maintenance costs of the road.
O'Keefe has successfully directed the public's attention away from the key issue here.
Why does St. John's want to pay for the maintenance of a provincial highway?
From day one, St. John's knew Mt. Pearl would not contribute to this highway. It appears St. John's has been outsmarted by the provincial government on this. The city should have paid the $10 million they initially offered as a contibution to build the highway (even this gesture is generous) and left the maintenance issue to the province. This way the city would have had a one-time cost and not the annual cost it is going to be faced with.
This orchestrated debate is an attempt by the city to deflect our attention away from the committment the council has burdened us with.
If we follow O'Keefe's logic, those of us who do not use the Gushue Highway will be able to request a rebate on our taxes - if, as he says, St. John's residents who use the road will not have to pay a toll.
This stance by the city of pitting one city against another displays a lack of leadership and does nothing to contribute to the argument of regional co-operation.
If it is to be a toll road, it will have to be a toll road for all who use it and not for selective users. Where do non-Mt. Pearl residents fit in this scenario or tourists?
O'Keefe and co. should have placed the Gushue Highway options before us and had a public discussion on the issue. An inclusive approach to the issue is much better rather than creating an "us" vs."them" scenario.
If nothing else, O'Keefe has certainly deflected the public attention away from the core issue of his decision to commit the city to the maintenance costs of Gushue Highway.
O'Keefe has successfully directed the public's attention away from the key issue here.
Why does St. John's want to pay for the maintenance of a provincial highway?
From day one, St. John's knew Mt. Pearl would not contribute to this highway. It appears St. John's has been outsmarted by the provincial government on this. The city should have paid the $10 million they initially offered as a contibution to build the highway (even this gesture is generous) and left the maintenance issue to the province. This way the city would have had a one-time cost and not the annual cost it is going to be faced with.
This orchestrated debate is an attempt by the city to deflect our attention away from the committment the council has burdened us with.
If we follow O'Keefe's logic, those of us who do not use the Gushue Highway will be able to request a rebate on our taxes - if, as he says, St. John's residents who use the road will not have to pay a toll.
This stance by the city of pitting one city against another displays a lack of leadership and does nothing to contribute to the argument of regional co-operation.
If it is to be a toll road, it will have to be a toll road for all who use it and not for selective users. Where do non-Mt. Pearl residents fit in this scenario or tourists?
O'Keefe and co. should have placed the Gushue Highway options before us and had a public discussion on the issue. An inclusive approach to the issue is much better rather than creating an "us" vs."them" scenario.
If nothing else, O'Keefe has certainly deflected the public attention away from the core issue of his decision to commit the city to the maintenance costs of Gushue Highway.
Tuesday, November 10, 2009
SJSEL - Subsidy Request and Approval
St. John's city council approved St. John's Sports and Entertainment Limited (SJSEL) request for a $1.5 million subsidy for 2010.
In relative terms this is good news for the citizens of St. John's. The subsidy is being reduced!
However, will this be the size of the subsidy for the forseeable future? What does SJSE have planned for the future operations of Mile One and the Conference Centre?
Remember, this is the organisation that had a corporate plan that would see it "debt free and subsidy free by 2010". Here we are with a 2010 plan for a subsidy of $1.5 million and a debt of $7.3 million.
Since 2002, citizens of St. John's have contributed $13 million (Subsidy plus Operating Loss) towards the operations of Mile One and the Conference Centre.
Will SJSE advise us what the long term plans are for the Centre and what options the city could consider for the place - Sell it? Lease it?
It is currently one very expensive hockey-designed concert venue requiring taxpayers' funding - funding that could be used for more essential city operations.
In relative terms this is good news for the citizens of St. John's. The subsidy is being reduced!
However, will this be the size of the subsidy for the forseeable future? What does SJSE have planned for the future operations of Mile One and the Conference Centre?
Remember, this is the organisation that had a corporate plan that would see it "debt free and subsidy free by 2010". Here we are with a 2010 plan for a subsidy of $1.5 million and a debt of $7.3 million.
Since 2002, citizens of St. John's have contributed $13 million (Subsidy plus Operating Loss) towards the operations of Mile One and the Conference Centre.
Will SJSE advise us what the long term plans are for the Centre and what options the city could consider for the place - Sell it? Lease it?
It is currently one very expensive hockey-designed concert venue requiring taxpayers' funding - funding that could be used for more essential city operations.
Friday, November 06, 2009
Councillors Receive Pay Increase
Did you know St. John's city councillors received a 1% pay increase on October 12?
This increase was originally tabled by council at their April 13th, 2009 meeting when they approved a 2% salary increase effective October 13th, 2008 and the above increase scheduled for this year.
In the spirit of openness and transparency, council should have announced receipt of this latest increase at their October 12 council meeting. Public announcement of this latest salary increase is eerily similar to how we found out about the provincial MHA's receiving their 8% increase.
Council has to improve its communication with citizens.
I look forward to Mayor O'Keefe acknowledging this salary increase at the next council meeting.
This increase was originally tabled by council at their April 13th, 2009 meeting when they approved a 2% salary increase effective October 13th, 2008 and the above increase scheduled for this year.
In the spirit of openness and transparency, council should have announced receipt of this latest increase at their October 12 council meeting. Public announcement of this latest salary increase is eerily similar to how we found out about the provincial MHA's receiving their 8% increase.
Council has to improve its communication with citizens.
I look forward to Mayor O'Keefe acknowledging this salary increase at the next council meeting.
Wednesday, November 04, 2009
Council Members Compensation
The following is the compensation package for city councillors:-
Salary
Mayor...................$97,597
Deputy Mayor .......$45,253
Councillor..............$35,024
All the above attract 1/3 Tax Free Allowance
Each member also receives the following Group Insurance Benefits
- Life Insurance coverage of $100,000
- Accidental Death and Disability coverage of $100,000
- Health Insurance including private hospital, 80% prescription drugs, 80% extended health, $200 Vision care every 2 years, $35 eye exam every 2 years and travel insurance
The first two are paid by the city while councillors have to contribute 4% of the cost of the Health Insurance Plan.
Pension Benefits
Eligibilty: Served two terms and at least aged 55 years.
Benefit: Percentage of base salary as follows:
Two Terms............20% of Base Annual Salary
Three Terms..........40% of Base Annual Salary
Four+ Terms..........60% of Base Annual Salary
Base Annual Salary for pension is 2/3 of salary noted above. Mayor's Salary is $65,065, Deputy Mayor $30,169 and Councillor $23,349
The pension has an annual index of 1.25%
Health Insurance will continue for a councillor upon retirement as long as he/she is a member of the group plan at time of retirement and is an active member of council immediately prior to date of retirement. The city pays 100% of the health premium for those councillors who qualify.
Salary
Mayor...................$97,597
Deputy Mayor .......$45,253
Councillor..............$35,024
All the above attract 1/3 Tax Free Allowance
Each member also receives the following Group Insurance Benefits
- Life Insurance coverage of $100,000
- Accidental Death and Disability coverage of $100,000
- Health Insurance including private hospital, 80% prescription drugs, 80% extended health, $200 Vision care every 2 years, $35 eye exam every 2 years and travel insurance
The first two are paid by the city while councillors have to contribute 4% of the cost of the Health Insurance Plan.
Pension Benefits
Eligibilty: Served two terms and at least aged 55 years.
Benefit: Percentage of base salary as follows:
Two Terms............20% of Base Annual Salary
Three Terms..........40% of Base Annual Salary
Four+ Terms..........60% of Base Annual Salary
Base Annual Salary for pension is 2/3 of salary noted above. Mayor's Salary is $65,065, Deputy Mayor $30,169 and Councillor $23,349
The pension has an annual index of 1.25%
Health Insurance will continue for a councillor upon retirement as long as he/she is a member of the group plan at time of retirement and is an active member of council immediately prior to date of retirement. The city pays 100% of the health premium for those councillors who qualify.
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