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Town operating budget passes by razor-thin vote

Posted on January 9, 2019 by Taber Times

By Trevor Busch
Taber Times

Although it would come down to the wire through a 4-3 split vote, town council has approved the 2019-2020 operating budgets which incorporate a net two per cent tax revenue increase.

The approved 2019 operating budget shows total revenues of $24,463,638 with total expenses of $29,203,988. For 2020, total revenues are now $24,669,206 with total expenses ringing in at $29,409,556. In the 2021 operating budget — which remains unapproved — total revenues are shown at $24,112,463 with expenses of $29,788,063. The 2021 operating budget is currently showing a $935,250 deficit.

“With this motion — if we pass this motion — we’re approving a net two per cent tax increase,” said Coun. Louie Tams before the vote at council’s Dec. 17 regular meeting. “I think as council we need to be aware, and cognizant that we are agreeing to pass a net two per cent tax increase. My personal feeling is that with the economy we’re living with today in southern Alberta and Taber, a net increase of two per cent is too high. I’m not a believer in zero. But in my mind, two per cent is one per cent too much. Is there room to change this? I think we need to take a good hard look before we pass this budget.”

During a special budget meeting on Dec. 3, council had eliminated a $1.53 million deficit for 2020 through a series of targeted cuts to proposed positions and scheduled maintenance projects. Changes approved included transferring $250,000 for asphalt milling and overlay to the capital budget, while retaining a new capital accountant position ($104,039).

Finance director John Orwa was careful to point out that a net two per cent increase to tax revenue is not a calculation of the town’s mill rates.

“Mr. Orwa, we are spending two per cent more money,” continued Tams. “So if we’re spending two per cent more money, we need to get two per cent from somewhere. I know the mill rates are set, and the assessments aren’t set, but if we’re spending two per cent more money we need to find two per cent more money. In this case, it’s going to come from tax. So the reality is, we are increasing. We’re spending two per cent more money.”

Mayor Andrew Prokop would state that council had given “clear direction” to hold the line at two per cent in October 2018, but some question would arise about whether this was an official position or simply a verbal direction to administration without majority consensus of council.

“I agree with Councillor Tams, it’s two per cent more from the people,” said Coun. Joe Strojwas. “But we’ve got a progressive community, we’ve given direction to administration, and a two per cent increase in taxes is very minimal compared to other urban communities around us. We are holding the line, there’s staff increases, and cost increases. There’s really nothing wrong with approving this budget at two per cent. It’s very minimal, and we need to go forward with it. Now is not the time to start hacking it apart again.”

Coun. Jack Brewin sided with Strojwas on the issue.

“I agree with Councillor Strojwas on this. I believe that every item regarding this upcoming budget has incorporated a two per cent net tax. It’s what we’ve assumed all along through this.”

Following discussion, council voted 4-3 to approve the 2019-2020 operating budgets.

Councillors Bekkering, Tams and Mark Garner opposed the motion. Strojwas was absent from the meeting, but participated in the proceedings via teleconference call.

Under Alberta’s Municipal Government Act, municipalities are not allowed to budget for a deficit and total actual revenues over a four-year period must be equal to or greater than total actual expenditures.

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