City staff have proposed a budget for 2013 that would see a 2.3-6.5% tax increase, depending on which recommended program changes are approved by city council. Over the next few weeks, council will review the budget in detail and make recommended changes, with final approval Tues. Feb. 19 for the capital budget and Mon. March 18 for the current (operating) budget.
We must do better than a 6.5% increase, and that will require some tough choices.
I’ve provided some preliminary thoughts below, subject to further research and review. I’m looking for your input on whether these suggestions are headed in the right direction. Council members can submit proposed changes to the budget by Feb. 1 (for the capital budget) and by Feb. 19 (for the current budget). Any requested change must be supported by a majority vote at council (4 of 7).
Top of mind for me is balancing the requests for budget increases with the economic pressures on our community, and your ability to pay. The Bank of Canada has recently forecast continued slow economic growth until at least the second half of 2014. Many of you have experienced pay freezes, or cuts; we have many seniors in our community living on fixed incomes. We need to be very careful about increasing spending in this difficult economic climate.
Budget planning has changed this year, to a “base-plus” model, namely increases to the base (or “existing”) budget roughly in line with inflation, plus service increases or reductions supported by a business case. The base-plus-business-cases add up to the total tax impact. The business cases have been grouped into two categories: recommended by staff and not recommended.
Council approved this model in the summer, but after seeing it in action, I believe we need to make some changes to it. Does an across the board inflationary increase encourage finding efficiencies? Why are there are new spending items in the base budget, which wasn’t the intent of the inflationary adjustment? I’ll be asking these questions.
I support the notion that increases should be tied to measurable outcomes, but a lot of the business cases don’t have that detail. In addition, the business cases are one-off wish-lists, without direct ties to an overall strategic focus. I’m concerned we’ll spend a lot of time debating small items, and lose the forest for the trees. In that respect, this budget process may not end up being that much different than previous budget discussions. I’ll be doing further research into how any increase will improve service to the community, and asking if there’s another way to deliver that service without a tax increase.
To keep things simple, I will list the key increases to the budget, regardless of whether they’re in the base or one of the business cases, and provide some preliminary comments. More detailed description of budget line items is available on my website here.
Let me know your thoughts by email at Marianne.email@example.com, comment below or participate in the city-wide public budget committee meeting (Jan. 30).
You can access budget documents, staff reports, overview presentations, and more here.
Summary of budget increases
- 1.25% increase for capital renewal
- Includes an additional $300k for local road resurfacing, bringing the total to $2.142m annually. That still leaves an annual gap of about $1m in funding; $3m is needed to stabilize the decline of the road network.
- Includes a .5% increase ($610k) in the dedicated infrastructure renewal levy.
My take: I support these increases as part of our commitment to focus on need-to-have infrastructure repair and renewal. The city has $2.2billion in assets with roads, and facilities and buildings the largest two categories (52% and 16% respectively); 64% of identified renewal needs are being met. The 2013 capital budget is $55million; tax supported funding accounts for roughly 50% of the budget, with the remainder coming from debt, reserve funds, development charges and recoveries.
- $300k annually for strategic plan implementation (a reduction of $100k from last year’s budget)
Question: It’s not clear what’s included. Can this be reduced by putting some expenditures on hold, or identifying specific programs in each budget year with a specific business case, rather than lump sum funding?
- 2% inflationary increase to local boards and committees (the library, BPAC, BAC etc).
My take: Need further review on how increases will be spent, and how efficiences are maintained; some costs are more driven by inflationary pressures, and others aren’t.
- E-government facility rental & communications $165k
Question: Can this be reduced, or removed without significant impact to customer service delivery on e-government? Council already approved $400k in spending on this project.
- Increase in custodial and rental rates for board properties $83k
Question: Can this be recovered through increased fees?
- Snow removal shifting from Roads & Parks Maintenance to Parks & Recreation $68k
Question: Why the increase, when service is shifting departments?
- Teen Tour Band trip:
Annual contribution to the trip (which occurs every second year) $15k; there is another $15k in the business cases. Why are two line items, in different places, if the request is $30k? Does the city provide any funding for the band now, and should we be contributing to travel, as opposed to, say, uniforms or equipment?
- Lakeshore Road Multi-Use Path Reconstruction
$300k, from capital, for Torrance to Guelph Ln: to accommodate pedestrians and recreational cyclists. Coincides with the reconstruction of the entire road, at $500k, which may or may not include a reduced centre turn lane to accommodate bike paths, depending on council vote Jan. 28.
My Take: I do not support removing the full centre turn lane to accommodate bike lanes, but I do support the investment in improving the multi-use path as a commitment to active transportation, including cycling, blading, skateboarding and walking. The 2013 budget includes $1.25m in multi-use path developments or improvements across the city.
- New Street Resurfacing, Martha to Guelph Line
Resurfacing in 2014, with potential Environmental Assessment Study in 2013 to engage the community and obtain feedback on design options to introduce on-road bike lanes. Study, $45k, approved in 2011.
My Take: I support public engagement on the road reconstruction and potential bike lanes; the study money has already been approved. Proper public engagement has been sorely lacking in the Lakeshore Road cycling lane discussion.
- Parking Meter Replacement:
Replacing parking meters that have reached the end of their life cycle with Pay n Display machines; one machine covers 8 spaces. $124k from reserve funds. In 2013, the focus will be on Brant St, from John to Locust (20 machines in total)
My Take: I support this as a customer service improvement for residents – easier to pay.
- Parking Garage Renewal, 200K
- Burlington Art Centre
Replace HVAC system, $400k, from capital. Total 2013 capital budget: $481,000, plus repair and renewal of 1/3 of parking lot, HVAC, LED lighting throughout; new Lakeshore Road sign, new parking lot sign, kilns, potters wheels lighting screens, hardware & software replacement; equipment and flooring: $81k, from capital.
My Take: I will be asking: are local boards required to build capital improvements into the own budgets, and by how much?
$1.33m for automated transit upgrades, including computer aided dispatch, automated vehicle and stop announcements, traveler information and passenger counters.
My Take: I support these as customer service improvements.
- Merit pay increases:
Human resources accounts for 49% of the budget; 8 positions have been redeployed to cover new positions proposed in 2013. The budget includes a 1.5% merit increase for staff, with no cost of living increase, and a 1.85% increase for council members, tied to the estimated consumer price index increase for 2013. Union increases for 2012 were 1.9%. The city aims for similarity between union and non-union increases.
My Take: I support, in principle, the notion of non-union compensation being similar to union compensation; that said, I have asked for more information about the tax impact of reducing non-union compensation to 1% (a .5% reduction). Any increase for council members should be the same as the increase of non-union staff.
- Randle Reef:
$230k annually for 10 years for the clean up of Randle Reef, funded by reallocating $230k of the $350k annually allocated for the Railway Crossing Reserve.
My Take: I voted for Randle Reef funding at both the city and regional councils as our part to help clean up the bay we share with Hamilton.
NOTE: All of the above increases are included in the “base budget” increase of 2.3%. Some of these are offset by increased revenue, detailed below.
Group 1 increases: brings tax impact to 4%
- JBMH levy $1.2m increase
My Take: I support the increase to reduce reliance on debt to fund the city’s important commitment to the hospital redevelopment of $60m.
- Leadership training to develop a municipal management program at DeGroote School of Business: $160k
My Take: I need to understand what the spending is for; there is already $80k in the base budget for professional development.
- Risk & consulting services 3 positions for 3 years $909k:
Question: Can these be eliminated or deferred?
- Alton community centre parks & recreation resources $324k
My Take: Support, as part of our commitment to this new community in our city
- Sound of music festival $37k:
My Take: Support. The city earns back its contribution from fees and charges to the festival. This is a contribution to both local culture (many local groups play in the festival), and to our young people – the festival is the highlight of the year for many of our youth.
- Reduced service for sidewalk clearing, $31k:
My Take: Do not support. Many residents have asked for enhanced sidewalk clearing, to improve walkability. Sidewalk snow cleaning is an investment in active transportation and transit use.
- Eliminate taxi script service for Handi-van (-$27) and auxiliary taxi overflow (-$90k):
My Take: Do not support. Many of our residents would be isolated and housebound without Handi-Van, and there is increasing demand and long waits for this service. The taxi script and overflow provide service when Handi-Van is booked solid.
Base plus Group 1 business cases = 4%, – .75% (cut risk/consulting), -.065% (reduce leadership training by half), +.03% add sidewalk plowing, +.09% add taxi script and auxiliary taxi for Handivan = 3.3%
Group 2 increases: brings tax impact to 6.5%
- Expanded transit service $584k:
My Take: Support, as an investment in alternative transportation.
- 4 firefighters for station 8 $431k
My take: Need more information on how the station is currently functioning, and any response or service impacts
- 4 firefighters for suppression staffing $431k
My take: Need more information on how the staffing level is currently being covered, and any response or service impacts
- Corporate projects/accessibility coordinator (1FTE) $80k
Question: Can internal staff and/or the accessibility committee be deployed for this?
- 7.1 FTE for new Alton library $463k:
My Take: I support the addition of staff for the new library but question the number. Need additional information.
- Library marketing, .4 FTE, $19k:
My Take: Need to understand what the measurable outcomes are for this investment.
- Library visiting to seniors, .3 FTE, $15k:
My Take: Support in principle, subject to further review.
- Burlington Art Centre funding for fundraising/foundation board development: $125k
My Take: Would like to see this expertise delivered via board/community expertise, or bundled with positions at some of our other boards (for example the sales associate position at BPAC). Can city staff be deployed to assist? What are the goals on the fundraising?
- BAC compensation adjustment $45k:
- Museum convert part-time curatorial to full-time: $7k
My Take: Support in principle, subject to further review.
- Burlington Performing Arts Centre: 1FTE technician, 1FTE sales associate, $132 total
My Take: Understand the need for the technician position, to cover 15 weeks of lieu time; would like to see it covered from ticket sales and booking revenue; do not support the sales associate position if the net revenue is only $20k.
- BPAC $225k to offset revenue shortfall
My take: While I support a city contribution to the centre, it is not a backstop to cover annual shortfalls. I do not support it being part of the city’s base budget. Any municipal contribution must be tied to policy goals of supporting local culture, and making a reasonable contribution to capital; taxpayers should not be subsidizing professional entertainment. I have requested additional information about performance last year and projections this year, as well as local bookings.
- Burlington Economic Development Corporation resources plus 1FTE for economic analyst $370k:
My Take: I support an investment in BEDC to allow it to shift staff currently involved in fundraising/networking events, and redeploy them into sales calls and business attraction. However, the BEDC model still includes significant fundraising events. I question the economic analyst position; I’d like to see a sales/business attraction position instead.
3.3% carried from above, plus transit (+.48%), plus Alton library staff (up to +.38%), plus a contribution to BEDC tied to business attraction activities (up to +.3% ), plus library marketing/visiting services, (+.03%) plus museum (+.01) = 4.5% city tax impact
Suggested base savings would add up to another .5% decrease.
Your Take: What would you include or exclude from the budget? Leave a comment below, or email me at Marianne.MeedWard@burlington.ca
For access to budget books and additional budget information click here.
Revenue that offsets tax increases
The city benefits from increased revenue sources. This revenue is already built into the base budget assumptions above.
Increased revenue from transit fare revenue due to increased ridership, rental and programming revenue from fee increases ranging from 1-5%, increase in planning & building revenues
Supplementary taxes of $1.35m
These are new taxpayers being assessed by MPAC and beginning to pay. MPAC is aiming to provide assessment of new buildings within 6 months of occupancy.
.87% increase in taxes from new taxpayers, and increases to property values.
Additional costs are offset by a 1% increase in non-tax revenues, including increased fees for planning & building, increased transit revenue (above), increased rental and programming revenue in parks and recreation, increased recoveries under the Regional Road Maintenance Agreement.
Additional non-tax sources of revenue include investment earnings, penalties and interest, grants and subsidies from upper levels of government.
Retained savings and reserve funds
Staff are projecting $3-4m in retained savings from last year’s budget (report to follow in February); they are further recommending that $1.1m of this go into the tax rate stabilization fund. Drawing from this fund will be used to offset tax increases due to additional spending this year by roughly 1%.