December 19, 2012

Residents not impressed with Town budget process

As published in The Erin Advocate

Town officials were roasted by ratepayers last Wednesday at a meeting designed to get public input on Erin's 2013 budget. Those in attendance were unimpressed with a tentative tax hike of 17% in Budget Draft #2, even though it was down considerably from the 32% increase in Draft #1.

There were angry questions about cost overruns in the construction of the new fire hall, increases in administration costs, and the "embarrassing" condition of Erin's rural roads. Some were outraged that council agreed to give staff a 3% raise (phased in for a 2.25% impact in 2013).

"A 17.5 per cent increase for administration – that, to me, is just plain unacceptable," said resident Ford Ralph. "We can't afford these kinds of increases. We're all ratepayers. A bunch of us are retired, on fixed incomes, and we're not getting a 17.5 per cent increase in pensions to pay for the tax increases. If you're still working, most companies, if you're lucky, will give you two or three per cent."

He said it might be reasonable for Draft #3 to come in with a 3-4% overall increase, to allow some important initiatives to proceed.

The current plan is to maintain service levels, but the latest draft includes a hiring freeze and a 25% reduction of overtime, in all departments. New initiatives, and some capital costs, have been cut or deferred. Grants to community groups will be reduced 25% overall, though the amounts have not been decided, and the Erin Cinema program is to be cancelled, for a saving of $16,687.

CAO Frank Miele said was important to set aside money in the Administration budget for economic development initiatives ($35,000), since this could help boost the boost the commercial-industrial tax base and reduce the burden on residential taxpayers. Increased salary and benefit costs for the new CAO position also mean an additional $55,255 for Administration.

Treasurer Sharon Marshall explained that some new costs in the budget cannot be avoided, including $65,400 in reduced provincial funding, an extra $6,126 in conservation authority levies, plus an extra $136,971 in debt servicing and $190,000 in unexpected costs related to the fire hall. Combined with the lack of a surplus in 2012, these "non-discretionary" costs alone would bump up the tax rate by 14 per cent.

An average property assessed at $383,000 had a Town tax bill of $995 in 2012. The Town portion represents only 20% of the whole bill, with the County at 55% and Education at 25%. Draft #1 would have increased the Town portion by $323, while Draft #2 increases it by $170.

Some at the meeting promoted the concept of zero-based budgeting, justifying every expenditure instead of adding percentages to the previous budget.

Bruce Hood urged the Town to make better progress on improving the condition of gravel road, some of which are impassable in the spring.

"The status quo is not very good," he said. "I am embarrassed at the condition of our roads."

Matthew Sammut got a round of applause when he said, "It's as expensive as heck to live in this town, but  sometimes I ask, 'Can I stay in this town?' We live in very difficult times. We can't afford the bills we're getting, let alone the increases. You've got to slash, painful as it is.

"Clearly, numbers are getting out of control. It's a slippery slope – once you get on these paths, it can get worse year after year. As much as we have to fight hard to ensure that next year we have some fiscal responsibility, we have to ensure that the future for this town continues to show fiscal responsibility."

From Draft #1 to Draft #2, about $711,000 has been cut from operational costs. Some departments are below 2012 levels, but capital spending for the roads department was increased from $6 million to $7 million. That will be offset by $4 million in revenues, but the overall roads increase to be covered by taxes is still up by about $500,000.

 "You are the shareholders of the corporation," Mayor Lou Maieron told the crowd about 50 at Centre 2000. "We are trying our best to come in with a reasonable budget. I'm a believer in saving for what we want to do. We need money for roads and infrastructure."

Councillor Barb Tocher was in attendance, but Councillors Josie Wintersinger, John Brennan and Deb Callaghan were absent due to other commitments. The proceedings were recorded so they could hear the taxpayers' concerns.

There were complaints about the meeting format. Draft #2 was not available on the Town website prior to the meeting, so people prepared their comments based on Draft #1. Also, some of the figures on the screen were too small to read, and there was difficulty in hearing the staff presentations, since there were no microphones.

The full presentation from last week's meeting can be downloaded from the Town website, Members of the public can continue to provide input by contacting council members or CAO Frank Miele. Staff will be providing council with additional recommended changes. The next public deliberation of the budget will be the January 8 council meeting, at which time it could be approved.

County Councillor Ken Chapman used the occasion to launch an all-out assault on the town's Planning Department, saying it should be abolished. He echoed public comments made by Mayor Maieron in the past year, arguing that Erin could have all of its planning needs provided by the Wellington County Planning & Land Division Department, to which the Town already contributes about $200,000 a year.

"All told we are paying $345,000 annually for planning, of which $145,000 is not necessary," he said.
Planner Sally Stull was not at the meeting, but had included a warning in her section of the draft budget that Erin will need to allocate more planning staff and resources "to proactively manage and address upcoming development pressures".

Chapman asked if this was "the beginning of the empire being built". He asked whether a proposed $50,000 roads deficiency capacity study (not approved) was a "make work project for the planning department". He also was of the opinion that the department had caused "unnecessary delays" in the construction of the Medical Centre and Tim Horton's buildings.