City coy on reserves

By Scott NeufeldMonday, January 15, 2007 http://www.dailycourier.ca/article_879.php

The City of Vernon has cut spending to limit this year’s tax increase but one city councillor is still puzzled about the city’s budget.Coun. Barry Beardsell said he’s yet to see what staff have done with the city’s financial reserves. Until he sees what’s in the reserves, Beardsell said it’s difficult to get a clear idea of what the city will do with all of the taxes it will collect from taxpayers this year.“I’m surprised that by now they haven’t told us exactly what’s in reserve,” he said. “In my mind that’s an integral part of the budget process.”

One of the concerns is with the policing reserve. Although residents were taxed to pay for 49 officers, only about 46 were paid last year. Beardsell said there should be several hundred thousand dollars left over in the policing reserve, but the money may have been moved into the general budget.“If the poor taxpayer is being charged for policing then that money better go into policing,” he said. “It was put it into reserve for policing not for other things, it’s still not clear that is what was done last year.”

Staff are telling council that some of the reserves are operating at very low levels, but Beardsell said it is difficult to remedy that without knowing the situation in each reserve.“Until I’ve got definite answers I can’t say I can feel confident with the budget process,” he said.There are also some questions surrounding the handling of the policing reserve.In city finances reserves are used to insulate the city from the need for sudden expenditures. The cost of sudden fierce snowstorms are paid in part by the snow removal reserve, while additional police officers are paid for out of the policing reserve. If the reserves dry up it’s more difficult to cover unexpected expenditures.

During last year’s budget process Beardsell criticized fellow councillors for creating a series of “slush funds” by pouring money into new reserves, including $300,000 for a grant matching reserve, $200,000 for a transit reserve and $100,000 for environmental policies.After lengthy debate last year’s tax increase was whittled down to 1.46 per cent, so far this year’s budget increase is set at about 2.84 per cent, after city staff chopped one per cent of expenditures from each department.

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Don Quixote Note: The Policing Reserve missing money appears to be the same monies that I referred to in the post A $350,000 Sleight of Hand (Or I'm so mad I could piss nickles !) . Coun. Beardsell uses the KISS* method of explaining accounting movements of money much better than I did in my one page rant went he simply states ' Beardsell said there should be several hundred thousand dollars left over in the policing reserve, but the money may have been moved into the general budget.'

*KISS - (KEEP IT SIMPLE STUPID !