More Taxes? Maybe just in a different format.

Last week at the council meeting there was a motion made by Councilor Saje to approve a recommendation from administration to conduct a Facility Audit/Needs Assessment at a cost of up to $90,000.


The motion was passed by a vote of 5-2, (councilors Mitchell and Londsbury opposed). No question this process needs to take place some of our building are in bad shape, there were questions raised by various councilors regarding facilities that were not on the original list, fire halls, seniors facilities etc. To my surprise knowing the positions that some of the councilors previously took nobody raised the Crowsnest Centre.

The big question in my mind is how was this going to be paid for? Administration is recommending that the dollars be taken out of the MSI funding that the municipality receives every year from the provincial government. This is a reasonable approach except it now creates a hole somewhere else. That money has been received by the municipality for quite a few years it’s always been spent, now some where down the line there will be a $90,000 shortfall.

But the optimistic side of my brain says that’s no problem there will surely be saved $90,000 some where in the operation by finding more efficiency improvements that were so often spoke about in the last year this hope did not last long.

Last night I attended the G+P meeting to my surprise during a discussion about organizational responses to public correspondence/calls. The acting CAO made the comment that administration could well be looking at 1-2 more clerical positions for the office. Obviously, no improved efficiency savings in that part of the operation, keep in mind that every person added to the municipality adds another $50-60 thousand per year.

Going back to my original comment where are they going to find additional revenues.

To very little surprise item #5 under topics for discussion is Franchise fees, what has become a great revenue generator for municipalities over the years and allows politicians the opportunity to claim they did not raise your property taxes, very similar to municipal water/sewer/garbage bills.

Right now on your utility bills you will see a line item marked Municipal Franchise fee between the various companies it brings in $360,000 a year, council will be reviewing these rates in the very near future.

On behalf of the over taxed residents of this community I surely hope that all these studies, audits, task forces are going to be paid for by dollars saved in improved efficiencies not by increases in taxes (property, utilities, franchise fees, user fees etc).

Coming soon, time to pay the piper

Last week at the council meeting the head of finance was giving the council an update on the financial state of the municipality to the middle of August. Within that discussion somebody pointed out that there is an almost $300,000 liability for accumulated sick time for the municipal staff, a couple of other councilors seemed unaware of this. Which surprised me in the sense that this number appears in the annual municipal financial statements every year, which council just reviewed three months ago.

For the benefit of my readers where does this come from?

Municipal employees hired after July 1 2008 receive one and a half sick days per month (prior to that it was two days per month this was changed during the bargaining process at that time). If they do not use these days they get to accumulate them up to a maximum of 120 days, which they are then paid out on a 50% basis when they retire. (For example 60 days times 8 hours @ approx $30 per hour equals $14,400 per employee). The difficulty with this benefit is that after an employee has been with the town for less than seven years the 120 days are accumulated and in some cases it becomes an additional 18 days a year off. If they do not use them they lose them, there is simply no incentive to not use them.

Now they are aware maybe this council will have some ideas to deal with this issue.

The next issue related to this and where it becomes increasing difficult to manage the municipal finances especially when the workforce is expanding is the cost of payroll. I am told that the town of Pincher Creek’s employees just turned down a three year contract with a wage increase of 3%, 2.5% and 2.75%. The Municipalities contract with CUPE is up at the end of the year, applying those same increases to the Pass would see some huge additional costs. In the 2010 financial statement (which would not cover the new positions created this year total cost of Salaries, Wages and Benefits was $4,923,486 increase those numbers by the percentages above 2012 would go to $5,071,191, 2013 $5,197,970, and 2014 $5,340,915.

That’s an additional $839,618 over the next three years or to put it in very simple terms it would take an average increase of 2.4% in taxes each year to accommodate those additional costs. Several factors that will come in to play here; the impact of the new positions created this year, maybe Cupe will be willing to accept less in this round of bargaining than they would in Pincher and surrounding areas. Or the workforce through gains in efficiencies will shrink enough to offset any additional wage increases.

Just some things to think about especially if there is further consideration to increase the municipal workforce.