Monday, April 8, 2013

Mumbling and Bumbling at the Eleventh Hour-2013 Mill Rate

Today at 3pm I attended a Special Council Meeting fully expecting to hear First Reading on the mill rate bylaw. 
The bylaw that drives the revenues, that operates the municipality, it's programs it's facilities and everything else that matters to us the taxpayers. 

Well after five months of intense debate, numerous meeting, two years of working on the tri annual budget and a Council commitment to not increase the mill rate by more than 2.5% per year we have a big oops.

Here at the eleventh hour we find out that the 2% reduction in the assessment base that administration and council had anticipated is really a 5% reduction. 
What does that mean in simple terms? a short fall of "$295,000" this year, what did administration offer as a solution to that short fall? Two options, one to take $295,000 out of reserves or two to increase the mill rate by 7.5%.  
What did council do, they voted to have administration come back with a 4% reduction in the operating budget despite administration claims that the budget has already been cut to the bone and that they would now have to look at reducing services and programs. Let`s not lose site of the fact that cutting the operating budget by 4% over a twelve month period is one thing by the time the mill rate is in place one third of the year will have gone by, in reality that 4% will become 6% over an eight month period. 

Timing-Council must give the mill rate bylaw three reading, which they have not been willing to do in one meeting so they have to find $300,000 in savings and schedule another special meeting between now and next Tuesday the 16th.  If third reading is not done by the 16th bills will not go out on time, (April 30th) the province requires that  residents have 60 days from the date of billing to pay their bills. Administration claims that somewhere between 65-70% of our residents pay their taxes in one payment at the June 30th dead line. Which means if the bills are late the municipality runs into a cash flow problem at the end of June.

Can you believe that we are in this position on April 8th after five months of the Budget process. 


23 comments:

Anonymous said...

And where should the ax fall... on Marion, the CAO or council? Whoever came up with the 2% vs. 5%? Is there no communication between the CFO and the municipal assessor?

This shouldn't be simply a case of oops. But probably will be as there is never any consequences for not being able to do your job properly, just excuses.

Anonymous said...

I would have a lot more sympathy for these guys. If they had not spent the last three years telling us how they are doing everything so well. Think about all those comments and arrogance regarding putting procedures and policies in place to run a municipality the way it should be. All the new bylaws.

Alex

Anonymous said...

Well, they could just "defer" some of the top salaries, couldn't they?

Anonymous said...

Somewhere efficiency was substituted with officiousness. So they talked about bringing efficiencies and brought us officiousness instead.

Anonymous said...

And a certain councillor may once again say that it is just but another 25 cents a day?

Anonymous said...

Guess they can all take their medicine and have a good nights sleep tonight!

Anonymous said...

We could have a pie in the face event, if we could convince the right people to be the "faces".....I'll bet we could raise enough money to cover the deficit.

Anonymous said...

Feb. 19 minutes:
M#6765-13: Councillor Lonsbury moved that Council accept the 2013 Capital and Operating
Budget as presented by Administration.
CARRIED UNANIMOUSLY
A recorded vote was requested.
In Favour: Mayor Decoux, Councillors Gail, Lonsbury, Mitchell, and Saindon
Opposed: Councillor Gallant


That's sort of weird. How was it CARRIED UNANIMOUSLY when it wasn't?

So now they un-accept that Budget. Darn, I was just about to FOIP it, but I guess now it doesn't exist.

And shouldn't they do this:
MGA 194(3) The chief elected official calls a special council meeting by giving at least 24 hours’ notice in writing to each councillor and the public stating the purpose of the meeting and the date, time and place at which it is to be held.

Anonymous said...

Well, after reading, the comment from 9:28, it looks like somebody's not following the rules. I think we should call the RCMP. Isn't that what happened to our VOLUNTEER Fire Chief?

Anonymous said...

Dean, Is this the normal way of calculating a budget? Working strictly off of the mill rate seems wrong to me.Had property values gone up then their budget would have been fine?Working with a budget this way must assume that property values will always stay the same.Why would they not just say that the budget will not increase by more than 2.5% instead of the mill rate?
I expect property taxes to rise every year with inflation.I really do not care if property values fall by 5% and the mill rate rises by 7.5% and my actual tax bill goes up 2.5%.Or the other way around, property value goes up by 5% and the mill rate drops by 2.5% and my actual tax bill rises by 2.5%.
The scary thing about doing things this way is if property values ever really take off,so will your tax bill.

Anonymous said...

They had enough money to plow some streets yesterday morning. They didn't do my street, it melted before they could get to it.

Anonymous said...

Well I hope they focus on reducing the cost of administration. Not the people that keep our streets clean or run our facilities.

Anonymous said...

What else have they projected that they fell short on. Maybe COP fine revenue, is that why they are revising all the Bylaws to create the potential for more revenue????????

Anonymous said...

Want really bothers me more than anything is that they only found this out YESTERDAY at the special meeting of council.
22 days before the tax bill is due to go out, that I am really struggling with.
What happened over the last 3-4 months, I do not question that the value of properties has declined in the last year. Every time a piece of property is sold the municipality is aware of that. So why would this come has a surprise?
It would be interesting to see what other communities in Southern Alberta projected and what actually happened.

Mike

Anonymous said...

"The valuation date set by the Municipal Government Act is July 1. For example, for the 2010 tax year, the valuation date for property assessment is July 1, 2009."
http://www.municipalaffairs.alberta.ca/1538.cfm#Valuation_and_condition_dates

MGA 302(1) Each municipality must prepare annually, not later than February 28, an assessment roll for assessed property in the municipality other than linear property.

Anonymous said...

Council always stated that the mill rate would not increase by more than 2.5 per cent. It always has been one of the fundamental positions of this council to me if they do not honour that position then can we the taxpayers believe any thing else they have to say???

M


Anonymous said...

Anon5:57 Hit the nail right on the head. Who looks after the finances even though not qualified to do so, and how come all the good and qualified people were let go and she is still there??? Very strange.

Anonymous said...

You just realized that you cannot believe anything they say.

Anonymous said...

Dean: I have just reread Gallant's platform which he used as a platform. That whole article smacks of hypocrisy, lies and political promises that are over the moon. I hope to hell he has no intention of using the same statements that have brought us to this financial mess. Promises, promises, promises turn into lies, lies, lies. This council has big ideas votes upon them then decides where they can raise the money to pay for them. Cart before the horse syndrome.

Anonymous said...

The Unapproved minutes give some details:
http://www.crowsnestpass.com/component/docman/doc_download/1991-unapproved-april-8-2013-special-council-meeting

"decrease of $16,489,060 to machinery and equipment was anticipated due to the
closure of Devon
...
decreased fair market value of residential properties of $30,203,420 and a decreased fair market value of non-residential of $3,985,530."


The valuation date was July 1, 2012 and the assessment roll was supposed to be done February 28. Why did this come as a surprise?

This is strange:
Bylaw No.865, 2013 – Mill Rate Bylaw- First Reading
This item will not be given first reading today.

Shouldn't there have been a motion to decide that?

Then there was a 25 minute recess, followed by an 8 minute session. Did they go into a backroom for that recess?

Anonymous said...

Here is the "bumbling" bit:

M#6829-13: Councillor Saindon moved that consideration be given to a third option, that
Council and Administration review the budget and look for a 4% decrease in
operations including from Council.

Councilor Lonsbury made a Friendly Amendment that Administration be directed to bring back a revised
budget which includes a 4% decrease in the Operating Budget.

M#6830-13: Councillor Saindon moved that Administration bedirected to bring back a revised
budget which includes a 4% decrease in the Operating Budget.
CARRIED


After all those "open and transparent" budget meetings, which Saindon invited the public to attend, so that we would not be "ignorant", he hands off the tough decisions to Administration to make in secret.

Anonymous said...

More than anything here the biggest point is that it took six months for Council/admin to figure this out.
Could you imagine the up roar if any level of government worked on a budget for six months then informed the public that one of the basic assumptions they were using was off more than 150 percent. Did not one member of Council ask during the budget process if the 2 percent drop in real estate values was un realistic. Most of us know somebody that has sold a home in the last year 2 percent is just plain silliness. Even 5 percent seems low but then you have to keep in mind that it was based on values to July of 2012. How much are values going to drop for next year very scary.
This whole process points to Incompentence at the minimum.

F.B

Anonymous said...

What I find really silly was watching the Councillors puff up their chests and get really red in the face to appear angry. When they were shocked with the numbers that were presented.
To hear at a later part in the discussion the Mayor mention that they had all had the information since the previous Friday.
I am really surprised Dean that you missed that.