On Dec. 9, director of corporate services Dale Culler detailed changes that had been made to the proposed 2014 operating budget, which had originally been based on a 2.5 per cent increase to property taxes. The 2014 operating budget is still awaiting the final approval of council.
“What we did is we took all of the information from the budget presentations to date, and took the input that we received from council, and the budget committee took a look at where we could make changes to the budget to come in at that 1.5 per cent. So there’s a number of assumptions that are built into this budget to get us balanced. We are balanced, currently on the operating side, at 1.5 per cent. Part of what we heard from council was about fine revenue.”
A number of line items were either conservative in estimated forecasts, or other efficiencies could be found, according to Culler.
“The first line, net taxes available for municipal purposes, there’s a reduction there of about $76,790, and that’s getting it from the 2.5 per cent that was presented for illustration purposes at the last meeting down to the 1.5 per cent. The next one, sales and user fees, there’s about $25,000 there. We didn’t amend the rates at all, but we looked historically, and also at our forecasts — this extra $25,000 is coming from our bulk water sales. Historically, we’ve been a little bit conservative on the bulk water sales. Franchise and concession contracts, we felt there’s about $10,000 in there.”
Culler went on to note other areas where dollars could be found to help balance the budget reflecting a 1.5 per cent increase.
“Penalties and costs of taxes, same sort of thing. We looked at it historically, and looked at our forecasts, and we feel that basically, based on the numbers that we’re seeing, there’s probably about $20,000 there. License and permits, we felt there’s about $5,000 there that we thought we could find. Another $10,000 is coming from admissions, specifically from the pool.”
The largest change to the previous proposed document was in the area of fine revenues, which have been boosted from an estimated $421,250 to $501,250 for 2014.
“The big one is the fine line. The fine line has some assumptions built in to it,” said Culler. “Nothing has been discussed with the police commission, but this is essentially taking a look at historical and forecast information on fines. We believe there’s about $80,000 there.”
Efficiencies and cuts to expenses amounted to roughly $280,000 to come to an effectively balanced budget.
“Under contracted and general services, we identified a number of things, almost $120,000, that could be taken out of those lines,” said Culler. Materials, good and supplies, we were able to take about $58,600 out. So that brings us to a net change, or decrease, of $338,760, which was what we were unbalanced at the end of the last presentation.”
Coun. Rick Popadynetz was cool to the proposition that an extra $80,000 could be found through fine revenues in 2014.
“Maybe you could enlighten me about fine revenues — $100,000 seems pretty liberal. Usually fine revenues come down as a deterrent.”
Culler admitted basing operating numbers on a potentially volatile revenue source did present risks.
“Historically, that fine line has been understated in the budget from a revenue perspective. Our surpluses historically have come from two places — an underestimation of revenues, and from some projects not being done, or some positions not being filled. So a combination of having some extra revenue coming in, and less expenditure. So we were challenged to take a hard look at our revenues. So when we did our forecasts and took a look at some historical numbers — now, in that particular case, that is a very difficult one to forecast, there’s no doubt.”
Mayor Henk De Vlieger, who previously served as chair of the Taber Municipal Police Commission, seemed less troubled by the idea.
“Based on past figures, we can assume by the law of averages that we could have this $80,000.”
Coun. Popadynetz was quick to suggest that if fine revenues fall in 2014, the town could be looking at a deficit.
“You would be, but you also have about three years of surpluses,” said Culler. “At the end of the day, there is an accumulated surplus with the town of a little over $2 million. If the program works, and there is $100,000 less, you would run the risk of having that particular line (as a deficit).”
Basing operating budget numbers on fine revenues is morally and ethically suspect, according to Coun. Popadynetz.
“I don’t think $100,000 is being realistic with fines, personally. I don’t want to see more photo radar set up to raise fine revenues. We live in a safe community — I’m happy with my community — and I don’t want to see deterrents in town, set up on holidays and in school zones. It bothers me to see this kind of thing, it’s like we’re trying to trap our own citizens to increase fine revenues. I don’t like that idea.”
Coun. Joe Strojwas pointed out the town wasn’t asking for a photo radar blitz in 2014 so they could balance their operating budget.
“The police commission has responsibility over that, how they allocate that. We can’t tell them how much to put the photo radar out there. We just decide on the amount, and they have to take it from there.”
Coun. Laura Ross-Giroux agreed with that assessment.
“I agree, we’re not asking them to go out there and do that. As Mr. Culler says, historically, they’ve been understating their revenues. To me, it’s more realistic.”