Should the taxpayers be allowed to vote on tax increases?

The Mayors Council representing all the metro area's of the lower mainland of B.C. Is looking to raise tax revenue to finance a $7.5 billion transit plan. They are proposing to raise the BC Provincial Sales Tax by half a per cent to fund this project. Nothing unusual government proposing to raise taxes and spend a pile of money.
What is out of the norm is they proposing to give the taxpayers the opportunity to vote on this tax increase. That means they will have to go out and sell the justification to the public for this tax increase. The proposal is to hold a referendum in the spring.


This raises many questions:
How far do you go with referendums? Should the taxpayers be allowed to vote on tax increases? Should referendum be for "one off" tax increases or for all tax increases? Should it be only for tax increases above a certain amount (more than the cost of living)? etc etc.

Our neighbors to the west are having quite a debate on this issue.

PST hike of 0.5% proposed for Metro Vancouver transit referendum

http://www.cbc.ca/news/canada/british-columbia/pst-hike-of-0-5-proposed-for-metro-vancouver-transit-referendum-1.2870043

Taxes; what are our neighbors doing?

Town of Pincher Creek approved their budget for 2015 and 2016.

Their tax rates are going up 1.2% in 2015 and 2% in 2016 plus their franchise fees are increasing by 5% both gas and power.

On the Franchise Fee their gas goes from 20 to 25% and their power goes from 8 to 13%. This will bring them in an additional $76,000 a year.

There is no consideration being given to increasing our franchise fees for 2015.

Presently our gas rate is at 25% and our power is at 16%.

Alberta Conservatives testing the water on tax increases.

The Alberta PC's are running in to all kinds of financial problems, what can be expected when spending is clipping along at 59% more than it was in 2005. Remember the promises during the election about balanced budgets based on $99 a barrel oil, which the opposition and all the experts stated was unrealistic. Well guess what folks we were told what the politicians wanted us to believe and we lapped it up.
Over the last week you have seen some fairly high level government officials talking about the possibility of tax increases, this is what the politicians call a "trial balloon" if the public reacts strongly the leader can come out and deny tax increases if the public does not react we all know full well what will happen.

Below is the link to contact the Premier and voice your opinions on tax increases



http://alberta.ca/Premier_contact.cfm

Spoon fed the truth for Christmass….. Hallelujah

Available on Brian Gallant’s blog in response to Peter Rosners comments it looks like we are getting spoon fed the “truth” for Christmas. Available at the following address:

http://briangallant.ca/wordpress/2012/12/11/municipal-inspection/

I would like to address Councillor Gallants comments, first impression for anybody that did not know better would be that everything is good in our little community:

1. He addresses the volunteer boards issue, looking from the outside I would have the impression that everything with volunteer boards is good. Did it not take six months of advertising to fill all the boards and committee’s if they are indeed filled. Question for my readers does anybody think council would have backed down on the Pool authority prior to the petition, the authority had two letters from administration telling them they were done. Did council not know? Is this one of those cases of the left hand not knowing what the right is doing?
2. He appears to place all the blame on the firemen because they walked out. What did he and the rest of council expect? What would happen at the mine if a Union President was fired on the spot. No suspension pending investigation, no external review by an independent agency.   
3. Peace Officers have given almost no tickets for bylaw infractions (10 in the past six months) despite hundreds of complaints. That would lead me to believe that the community has been cleaned up? Very good. They have given a number of tickets to non-residents, so are our Peace Officers treating residents different to non-residents? I can speed on 20^th avenue but not my friend from Sparwood can’t.. This will work well for community branding “Crowsnest Pass Alberta’s best kept secret home of a little piece of paradise and the non-resident speed trap”.   
4. He speaks to Peter’s comments on the Municipal Inspection, still does not get it 2500 taxpayers are not happy, with the exception of the hundreds upon hundreds that were bullied and intimidated to sign.
5. He addresses the “bureaucratic monster” has no substance. So it’s just a figment of everybody’s imagination at this point in time we really don’t have a CAO, Director of Finance and Corporate services, Director of Planning Engineering and Public Works, Director of Community Services and Protective Services, Manager of public works, Fire chief, Deputy Fire Chief, plus advertising for a Manager of Corporate Services. This is not a “bureaucratic monster” but then has councilor Mitchell very proudly stated a year ago, “The public should keep in mind that we now only have three Directors when we used to have four”.
6. Tax increases no increase in 2011 and only 2.5% in 2012, yes Councilor Gallant puts all the blame for tax increases on the Provincial government and the seniors. Check out the mill rate bylaws in 2010 the Municipality collected $6,432,821 from the municipal taxpayers in that year. 2011 with no increase the municipality collected $123,000 more in general taxation than the previous year (0% increase maybe it was all those new houses going up, or our increased home values). In 2012 with just a 2.5% increase the municipality collected another $265,000 in additional general taxation (2.5% increase once again maybe it was all those new houses going up, or our increased home values). Lots of new homes and greatly increased property values I’m sure most home owners that are deciding to sell are doing well. Then lets not forget the additional tax increase (more commonly known as the Franchise Fee). Some will even attempt to argue that this is not a tax, 2010 it sat at $295,000 increased to $570,000 in 2012 and would have gone to $907,000 in 2013 had it not been for the uproar from the public. Instead, it will only jump to $682,000 next year being Christmas I guess we should be thankful that this little tax only jumped 231% in three years instead of the proposed 308%.
7. Thinking about the Tax increases and the Franchise Fees I guess us Taxpayers should be thankful again, that the municipality as decided over the last two years to take less money out of our left pocket and more out of our right pocket.
8. And now I will present the opportunity for anybody to comment on my points or to list for us all the good things that have been achieved.
9. Being the Christmas season every time I drive by the Blairmore shop I get to say hoe, hoe hoe.       

Crowsnest Pass Public Transit Survey

In the last few days you should have received your utility bill, included with it is a survey on public transit.

For more information on public transportation and the costs associated with it take a look at the following post: http://crowsnestpasshome.blogspot.com/2011/05/public-transportation-in-crowsnest-pass.html


I know most people take those surveys and throw them in the garbage typically out of 3500 surveys mailed out the municipality will be lucky if they get 200 back which represents less than 6% of the population.
The problem with that of course is that all politicians have an agenda, things that they would like to see happen over the course of their term.
For example these surveys are usually filled out by people that passionately care about the issue at hand.
So I expect that the vast majority of the surveys the municipality receives will support public transit.

How will the politicians react? well those that are against spending $300,000 a year of taxpayers money will argue that the response represents such a small percentage of the taxpayers that its recommendations are irrelevant.
The politicians that support spending $300,000 a year of taxpayers money will argue that the over whelming response of the public was in support of this. Obviously the 90% that did not respond would have if they really cared about this issue.

The bottom line here is which ever side of this issue you stand on if you do not respond a very small percentage of the voters will have a much larger say in how this issue is decided. 


Note:

I noticed the absence of one key question on the survey "Would you be willing to have your taxes increase to provide a public transit system?"

 

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.

2011 Crowsnest Pass Budget, dollars and the wonderful things you can do with them.

Council this week looked for more clarification on a few issues, that they appear to be going around and around on.

Administration has given them the opportunity to have a 0% increase on the tax rate.

This is good in the sense that are taxes are high enough, I agree with Councilor Gallant that taxes are a deterrent to attracting people and businesses to the Pass.
Hard enough to say to a coal miner we want you to travel an extra hour a day to work, plus we will charge you an additional $700 a year in taxes to live here.

The bad side to this budget is there is absolutely no allowance for dollars into the reserves for a number of years those reserves were depleted to catch up on infrastructure projects. Two years ago the majority of council put an end to a proposed new shop in Coleman that started out at a cost of less than $400,000 and grew to $1,300,000 which would have virtually wiped out almost all the reserves we had.

Council last year budgeted for $450,000 to be put back into reserves which would have allowed them to grow for the first time in many years. To allow for that same amount to be put in reserves with the present proposed budget you would be looking at a 7% tax increase.

The issue of borrowing money to buy equipment, for the last six years council set aside $250,000 per year for purchasing new equipment. This year that $250,000 is not being put aside its being borrowed in addition to another $300,000 to buy a grader and a track hoe. If that $250,000 was put into the budget for equipment you would now be looking at a 4% tax increase, instead the municipality is taking on $550,000 of debt.

Number of councilors have raised the concern about the justification of the track hoe, administration stated that they are spending $10-13,000 a year to rent a machine. Those numbers by any financial formula do not justify borrowing $250,000 the saving will not even cover the payment on a machine, let alone depreciation.

The issue of hiring, one I struggled with personally for years. I agree with Councilor Saje do an organizational review before you hire more people. Much wiser approach than Councilor Mitchell standard position of “if administration feels we need these positions,then we should fill them”

Administration argues that they have to grow to find the inefficiencies in the organization, with positions being deleted down the road as attrition takes place.

Government positions seldom disappear once they are put in place, work is found to
justify them. In addition you run into labor relations issues with your employees, I have never yet heard of a CUPE local that stated we don’t need that position any more.

Water Meters are going to be sent to the purgatory known as further study.

Administration is also counting on the sale of municipal land to the tune of $125,000 to balance the budget, the current market is almost making the sale of land impossible unless you are prepared to give it away. Should the municipality do that with the taxpayers assets? Should they be in competition with private sellers forcing land values even lower?


Where will the process go from here? A number of councilors have already expressed the willingness to increase taxes by a smaller number than 5.3%.

They will chop at least a couple of the full time positions, placing those savings into reserves, they will increase taxes by 1-2% with the cash like wise going to reserves. The fiscally conservative councilors will get to vote against the increase, which will pass any way.

The track hoe will also go the same direction as the water meters, to be re evaluated when further inefficiencies are found.

Finally Councilor Saje raised the issue of the lack of dollars (zero) for the New Strategic Direction of council, I also have not heard of any dollars for marketing or promoting the community. Likewise for new recreation facilities, affordable housing the only reference that as been mentioned in that regard is Councilor’s Gail idea to put a tax on weekenders that own more than one home in the Pass, which some how will encourage those people to provide those home’s to lower income families.

Special Council meeting "as the die been cast?"

Not trying to confuse anybody but there is a G+P meeting on January 25, 2011.
First of it struck me as strange that at the meeting of January 18, following a one hour debate on the budget. With a lot of questions asked by council, and administration indicating that they would bring those responses forth at the meeting of Jan 25 that they wouldn’t just add the budget to the G+P agenda.
After all, they left Jan 18 still sitting at 5.3% (which means in simple terms an extra $365,000 a year coming out of the taxpayers pockets).

In my mind I felt Administration would come back on the 25th with clarification to the councilors concerns, pull all the give me’s out of the budget. (Item’s that the admin team would like to have, but understand that to keep what they really want, they will have to sacrifice during the final strokes of the budget process to make the politicians look good).

Then I got to thinking maybe the “die as already been cast”, Councilor Saje will not be at the meeting of Feb 1st, if the budget was on the G+P meeting agenda then no motions could be past.

Therefore, what happens Jan 25, in my humble opinion?

Administration brings forth $200-250,000 in “give me’s” carpet in the office; reduce two casuals, float, storage shed for the Hillcrest Fire Department etc, etc. Council digs in there heals a little bit understanding that there will be a negative public reaction to all the new jobs being created, so a couple of them get chopped, in addition the evil water meters go back for further study.

Some councilors will suggest that a few dollars need to be put aside for new initiatives (marketing the community, looking at new facilities) the argument will be made that more time is needed, to review the municipalities services and facilities, wait for the recommendations of the economic task force .
Therefore, council in conjunction with administration will be more than willing to look at those issues next budget.

Then the majority supports a 1-2% budget with much bigger and better things to come next year.

I have been asked how does the municipality find the money to pay for all these new positions, keep in mind that last year council at that time did not allow the new positions which saved approximately $250-300,000.

The previous two councils had taken a position that each year they would put $250,000 aside to replace the aging equipment fleet; the present budget proposes to take on debt of over $500,000 to finance equipment. Where did the $250,000 go? Look at the new positions.

Anyway I may be wrong and if I am that’s Ok, I maybe off on my timing. But I look forward very much to seeing who takes what positions.

And much more importantly who proposes real “change”.

Tax Increases in the Crowsnest Pass

Recently ran a poll on what would be a reasonable tax increase for 2011, offered up six options on what in my mind would provide an opportunity to cover all ends of the spectrum.

They were, with the corresponding results

0-1% 6 votes 10%
1-2% 7 votes 12%
2-3% 7 votes 12%
3-4% 6 votes 10%
4% or greater 3 votes 5%
Get creative and cut taxes 27 votes 48%

Well from amongst the people that spoke here, the message is loud and clear.

Why is this relevant? for the following reasons: Tuesday Night Jan 18th Mayor Decoux asked council at least twice, "does council feel that they were elected to maintain the status quo, or to bring change to the municipality"

If you read my post on the meeting Councilor Saje offered up change in the form of a budget with some different ideas. Councilor Saje also spoke about how our population and tax base continues to decrease, but our spending goes up and up.

Councilor Saje also spoke about our organizational structure, why does the Pass have a Financial Department and an HR Department, when most other municipalities group the two together?

Councilor Saindon talked about the need to increase user fees, spoke to how the general public can no longer be expected to support programs that only 20% of the public uses. He also addressed the issue of performance of our various facilities.

Councilor Gallant also raised the issue of the Albert Stella arena how it brings in so little revenue versus its costs to operate, he also stated that there is no greater deterrent to bringing in new people and increased tax base than municipal tax increases.

Mayor Decoux stated that positions taken regarding no tax increases are very short sighted, that in the long term you need dollars to invest in the infrastructure of the municipality, or people will go else where, where the streets are all paved and facilities are provided.

Administration responded by making the case that the municipality needs to hire "more" people to find the efficiencies, so that in time as attrition takes place the positions at the municipality will "change" and where possible those efficiencies that the new people find will take place "in time".

Councilor Saje in his motion proposed that operating costs of some departments be reduced by 7%, in a previous post I stated that if you want to find real efficiency improvements that is the way to do it.
If council attempts to "find" the inefficiencies the debate between them and administration will go on forever, give administration clear direction and goals and let the people that do the job every day find the inefficiencies.


Status Quo, versus change, versus being creative.

As far as the 2011 budget, I clearly heard on one hand Councilors Saindon, Saje and Gallant talking about zero tax increases.
On the other hand I heard Mayor Decoux, Councilors Mitchell, Londsbury, and Gail talking about tax increases.

Council Meeting of January 18, 2011

Council Meeting of January 18, 2011

Public Hearing: None

Adoption of Agenda

Additions:
#5 under other business-High water levels in East Coleman
#6 Office Procedures

Under In Camera #1 Land

Motion to accept Agenda as amended passed unanimously

Adoption of Previous Minutes Jan 4, 2011
Correction, Motion made by Councilor Mitchell that states Councilor Mitchell abstained it should have been Councilor Londsbury
Motions to accept corrected Minutes passed unanimously

Delegations: None

Admin and Agency Reports: None

Business Arising from Minutes: None

Correspondence: Two letters one from John Pundyk and the other from Shane Stewart regarding tax increases. Both spoke to the high cost of taxes in the Crowsnest Pass, and the impact on attracting new people to the area.

Councilor Mitchell stated that both letters were good but offered no solutions to the municipalities financial problems, Councilor Saje stated that the solution is not to raise taxes.

Committee Reports: Minutes from G+P meeting of Jan 11,2011
Motion to accept minutes as presented passed unanimously

Bylaws: None

Notice of Motions: None

Other Business:
1. Get Outdoors Weekend: Motion made to support this initiative passed unanimously

2. Elected Officials Course: Motion for all of council except Councilor Saje will participate in an Economic Development Course in Pincher Feb 3, motion passed unanimously.

3. Councilor Saje requested approval for absence for the Feb 1st meeting, motion passed unanimously

4. Budget 2011: Some points regarding the budget

Proposed Budget sitting at a 5.3% increase

Various members of council spoke to a tax increase of between 0% and a small increase (?)

Administration to bring back program/service reductions for the meeting of January 25, and clarification for individual councilors concerns.

Various new positions are included in the budget-additional person in the HR department, one new programmer in the Recreation area, a full time Agricultural service field man, a Foreman for public works, and a part time position for the finance department, also two additional casuals over last year usage. (This will be served up Jan 25 as a cost reduction)

There was a lot of debate around the performance of facilities and various services/programs.

Prior to the debate Councilor Saje attempted to make a motion on the budget which the Mayor requested that he hold of on until the debate took place.

After the debate Councilor Londsbury moved to table the budget until Jan 25, to which Councilor Saje stated that he had attempted to make a motion prior that dealt with the budget.

The Mayor asked Councilor Londsbury to withdraw his motion, to allow Councilor Saje motion to be dealt with.

Councilor Saje then made a motion to accept the 2011 budget with the following conditions:

1.The $230,000 for the back hoe to be removed from the budget
2. IT archiving to be suspended until outside options can be looked at
3. IT Desktop be reduced to $10,000
4. IT soft ware be reduced to $12,000
5. Parade Float be reduced to $5,000
6. All departments with the exception of culture, and FCSS have their operating budgets reduced by 7%
7. No hiring for 2011
8. All non union staff be limited to a 2% wage increase for 2011
9. Municipal advertising be limited to $25,000
10. $65,000 be side aside to upgrade the municipal web site and for rebranding the municipality

After debate, and with everybody knowing that this was coming back on Jan 25th, the motion was defeated by a vote of 6-1 with only Councilor Saje in support.

Motion was then made to table the budget until Jan 25, which passed unanimously

6. High water levels in east Coleman: Councilor Mitchell requested that admin to bring this back at a later meeting providing council with information

7. Office procedures: Admin advised that they are working on this and will bring back at a later date.

Council Member Reports: Several councilors spoke about meeting they had attended.

Public Input: Mayor did not offer the opportunity for anybody to speak.

Budget starts In the Crowsnest Pass 2011

Monday @ the municipal office starting at 4pm.

Just a couple of what I believe to be relevant information from the election campaign now this process is beginning.

As a councilor, I will not vote for any increase to property taxes for any reason - period! It is time to take a hard look at the services we have and the way business is conducted by the municipality.

My many years of experience in operations within large corporations reveals to me that we have a huge opportunity to take these cost reductions and use them to keep our tax increases at or near 0%.

First comment there is no possibility of miss interpretation of that statement, the second comment what is near to zero?