Members of the public attend council meeting at city hall on Monday. Another meeting to discuss the next two-year budget cycle could be added to the schedule.--NEWS PHOTO COLLIN GALLANT
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Medicine Hat city council may consider adding another preliminary budget meeting to hash out details in the next two-year business plan before it needs to be passed in December.
That possibility arose at the end of Tuesday’s three-hour committee of the whole session that saw administrators take council members through the municipal operating budget, the largest topic of four such meetings this fall.
Administrators are recommending a 5.6 per cent tax increase in both 2025 and 2026, stating they have contained some costs related to high inflation, and trimmed a capital projects list with more cuts planned after next year.
They will also use more reserve cash than initially planned to balance the budget, but said maintaining reserves in a prolonged power slump will be crucial.
Coun. Andy McGrogan told the meeting he’d like time added for discussions to go through the budget proposal and recommended a deferred projects list.
“It seems like there’s a step missing, an opportunity say; we’re at 5.6 per cent, but what else is there here on items A, B and C, that need a little arm wrestling on some of the details,” McGrogan asked at the conclusion of the committee of the whole session.
Largely new this year, the meetings began last spring as information sessions where councillors could ask questions and give general initial approval for budget authors to advance work or generally alter plans and targets.
In July, councillors called for a more defined and smaller capital projects list and received one in October.
City manager Ann Mitchell said time could be added at the end of the final session set for Nov. 13, when land and economic development will be discussed, or a special meeting of council could be called.
“We’re happy to have another meeting and give council a chance to go through the package,” said Mitchell. “We’re happy to have a more robust discussion.”
The final draft of the 2025-26 budget is due at council on Dec. 2, and must be in place by Jan. 1, 2025.
Mayor Linnsie Clark requested more information on capital projects related to both maintenance or “new growth” opportunities.
Coun. Cassi Hider also supported another session, while Coun. Allison Knodel requested a memo on lining budget items against a recently adopted strategic plan.
“There’s an opportunity to reflect now, outside of any significant issues, it’s more about tweaks at this point,” said Coun. Robert Dumanowski. “It’s figuring out wants and needs against the property tax increase.”
On Tuesday, finance officials reiterated that a tax hike is required to align programs and spending following a two-year tax freeze in 2020 and 2021 while facing high inflation this year.
The city will use $11.9 million in reserve funding in 2025 to balance the budget, not including a new $5-million revenue line from investment income from the Medicine Hat Endowment Fund, and $5.1 million in 2026.
The current capital list is $11.7 million less than the original proposal from June. Departmental budgets were also frozen at 2024 levels going forward while $2.6 million in inflationary pressure was contained.
Net employment will also be held even year over year as 10 new positions would be offset by eliminating others.
A further $2 million is savings would be sought in 2026.
“We’ve done what we think we can to cut from the budget without reducing services at the level that citizens expect,” said Aaron Hoimyr, the city’s accounting supervisor and budget lead. “The next step is to evaluate those service levels.”
The city also expects revenue from provincial government operations or grants, including fine revenue, to be $500,000 less going forward.
