Council holds its nose and votes a tax increase

City Council held its nose and voted 4-2 to approve a preliminary 2011 budget that includes a four per cent tax increase for residential property owners. That amounts to a tax increase of about $45 on a property worth about $300,000. Here, Mayor David Raven pours a glass of water for Councillor Tony Scarcella before Tuesday's key Council meeting on the municipal budget. Scarcella and Chris Johnston (left) voted against the budget. David F. Rooney photo

By David F. Rooney

City Council held its nose and voted 4-2 to approve a preliminary 2011 budget that includes a four per cent tax increase for residential property owners. That amounts to a tax increase of about $45 on a property worth about $300,000.

There were no tax increases for business or heavy and light industry. Nor was there any tax relief specifically aimed at Downie Sawmills.

The budget, which cuts spending by 2.5 per cent this year and 2.5 per cent in 2012, forecasts revenues of about $16.4 million for 2011 with municipal expenses of about $15.9 million. The respective figures for 2010 were $16.6 million and $16.4 million.

But this budget (You can read the full five-year plan here.) will please those people who opposed cuts to Parks, Recreation and Culture programs. Funding for that department’s services has, for the most part, been restored.

Pressure from Parks and Recreation user groups through a Facebook page movement organized by Sonia Cinelli, shown here speaking to Council about the importance of Parks and Rec programs at the Aquatic Centre and the Forum, helped convince Councillors to restore funding to those programs and services. David F. Rooney photo

Also restored is spending on maintenance of the Engineering and Public Works Department’s vehicles and machines.

Ultimately, Council’s choices were boiled down to alternatives. One called for a residential tax increase of 3.5% and restored maintenance spending, which was deemed crucial and was proposed by Councillor Antoinette Halberstadt, but not Parks and Recreation spending at the Aquatic Centre and the Forum. The second option — the one all Councillors except Tony Scarcella and Chris Johnston supported — did include a restoration of Parks and Rec spending.

“Motherhood, apple pie and Parks and Recreation spending are all fine, but this isn’t what I had in mind,” Johnston said. “I just don’t see this taking us where we want to go.”

Johnston’s comments were echoed by other Councillors. Tony Scarcella wanted a residential property tax increase of no more than two per cent and was visibly angry with Finance Director Graham Inglis for not tasking his staff with creation of a new version of the budget that would include a full five-per-cent cut right now. Inglis maintained that he was fulfilling the wishes of Council which had asked for the two versions brought before it on Tuesday afternoon.

Phil Welock voted for the preliminary budget even though he was not in favour of the increase in residential taxes and disliked the fact that it did not contain a tax break for Downie Sawmills.

Steve Bender also voted for it, but noted “it should be two per cent. Unfortunately, there is oodles of proof that if you don’t keep with infrastructure you’ll pay a lot more later.

“I’ll hold my nose and vote for the four per cent.”

Peter Frew said it was “palatable” but noted that “perhaps the budget is still too fat” and requires further trimming. He, too, voted for it.

As for Antoinette Halberstadt, she took a Goldilocks approach and, liking neither option, would have preferred something in between. However, she, too, voted in favour of the spending package.

As for Mayor David Raven he said the vote “is probably the most important decision we’re going to take this year, before this fall (when the civic elections will be held).

“A four per cent increase to the residential sector is significant,” he said. “I’m very disappointed we have not been able to address the concerns of the heavy industry sector.”

Raven also said he was optimistic that Council will nonetheless be able to achieve some major improvements with the 2012 budget.

“It’s not nice but it is realistic and maintains the lifestyle and services we become accustomed to,” he said.

The preliminary budget will now be put before the public for 30 days of review and comment. (You can read the full five-year plan here.) At the end of that period, Council may make additional changes based on those comments.

Pressure from the Chamber of Commerce, whose directors are shown here in a meeting with Planning Director John Guenther, convinced Council that it has to keep a lid on business property taxes. It managed to do that but only at the expense of a four per cent increase in residential taxes. David F. Rooney photo