The city expects to see anywhere from 50 to 100 employees accept an early retirement package aimed at cutting labour costs.--NEWS FILE PHOTO
cgallant@medicinehatnews.com@CollinGallant
A high-profile series of municipal budget battles across Alberta may bypass Medicine Hat, according to Mayor Ted Clugston ahead of a city budget update later this month.
He told the News that Hatters “could be relatively pleased” with the update on Dec. 16, but a group calling for spending restraint say it wants more oversight and input at city hall.
The Medicine Hat Ratepayers Association was officially formed earlier this year and leader Alan Rose says his members want to work closely with the city administrators looking for ways to trim the budget and lower tax increases.
“In this day and age people are getting desperate with taxes increasing, and we want to offer an outside opinion and some guidance,” said Rose, citing several city construction projects and the lack of detail in publicly available budget documents as areas of concern.
“There are examples where we feel money hasn’t been properly spent.”
Rose says his group, which is aligned with the Canadian Taxpayers Federation, comprised of 26 registered members who are upset over project and program budgets.
He said more than 300 residents have signed a petition saying that cutting operating costs should take precedent over raising tax revenue to balance the budget.
Clugston said he’ll likely give Rose a chance to address council at the budget update presentation on Dec. 16, but stressed that oversight is in place in the form of councillors.
“City council is elected by citizens to be oversight of administration,” said Clugston, adding that spending restraint measures at city hall haven’t been well publicized.
This month’s update comes just one year after council adopted the 2019-2022 budget, but was called for due to new forecasts for gas division performance and also changes to provincial funding.
The current property tax plan calls for 4 per cent increases in each of the next three years to help shrink a structural deficit that appeared when gas production profits dried up four years ago.
About $16 million in reserve spending will be used this year as changes are phased in, but Clugston said reversing the that program would be “kicking the can down the road.”
The “Financially Fit” budget policy states the city should raise revenue via fees and taxes, while also containing or reducing costs and spending over 10 years.
The Medicine Hat Arena and Heald Pool were closed during the previous budget, though council reversed changes to the transit service that would have saved $650,000 per year.
Administrators are now looking at different management models to reduce city spending on seniors services and the Veiner Centre.
Rose says the transit reversal and yearly cost increases to operate the Canalta Centre show council and administrators need help.
“People should be going in and asking ‘What’s going on?’,” he said. “We want to be non-confrontational, and we’re not asking for anyone to get laid off on Christmas Eve.”
Clugston says department managers have held the line on spending and found efficiencies, but the trims are not high profile.
“There are a lot of $50,000 line items that add up to a lot,” he said.
The biggest portion of the financially fit budget plan though, comes from a slate of tax increases of 4 per cent yearly until 2027.
“I get why people are asking for zero, because their taxes are going up,” said Clugston. “But a zero would only push the problem down the road.”
Compounding the issue are reductions in funding from the province as laid out in the recently passed Alberta budget.
The province will stop paying a $250,000 grant to Medicine Hat next year that would have accounted for property tax on provincially-owned buildings. The reduction will double to $500,000 in 2021.
As well, the province will take a greater percentage of local police fine revenue and increase the cost of services provided by Alberta Justice.
Sources say the city could receive $1.4 million per year less in operating revenue, not including a scale-back in money for construction.
The operating reduction equates to about a 2 per cent property tax increase.
