Coldstream trims tax hike

By Jennifer Smith - Vernon Morning Star - April 02, 2008

Coldstream taxes have officially received the axe, although the cut isn’t as deep as some had hoped. Following a special budget meeting Monday dealing with a surplus left over from 2007, the majority of councillors agreed to cut the tax hike for 2008 from 9.17 to 6.95 per cent. “We could go to zero on our tax increase and look really good to the people but I think it’s poor management,” said Coun. Jim Garlick. Instead of allocating additional funds to lowering taxes, the extra money will be spent on the following:n replenishing the street sweeping and general road maintenance budget (which was initially cut by approximately $25,000 for the 2008 budget),
n $18,000 to complete the Coldstream Creek environmental study,
n $50,000 for the water budget, as precautionary funds following Vernon’s planned drop out of the Greater Vernon water utility,
n $100,000 for roads,
n $15,000 added to the equipment replacement reserve,
n $50,000 for snow removal budget, $15,000 for furniture and equipment and $5,000 for new fire hall signage.

Keeping a healthy financial budget was an important factor in determining the numbers, said Coun. Carol Williams, who was comfortable with where the tax increase ended up. “Generally speaking, we have to have taxes every year. I just think that we have to be very careful,” she said, while pointing to how a further tax cut could impact services. “What we’re doing then is there’s a possibility we’re cutting back on a service to our community.” Coun. Doug Dirk agreed that the approximately two per cent cut from 9.17 was prudent. Meanwhile councillors Mary Malerby and Glen Taylor rooted for a 5.5 per cent tax increase. While inflation and building up reserves for the future could warrant a tax increase, Malerby said it is not fair to load that on the people. “I think this is a bad year to balance tomorrow’s budget. That’s, again, today’s people paying for tomorrow’s services.” Coun. Bill Firman suggested a compromise of meeting in the middle at 6.17, but in the end agreed to settle at the 6.95 per cent tax increase. Council agreed that it is important that residents educate themselves on how taxes affect them in accordance with their assessments.How the mill rate (or tax per dollar of assessed value) works is based on averages. So if the average assessment increase is $50,000 and your home went up $10,000, you would pay less, explained Catherine Lord, director of financial administration.

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A taxing situation By Richard Rolke - Vernon Morning Star - April 02, 2008

There’s likely a sense of relief among Coldstream residents as a looming tax hike has been pared back. But how a 9.17 per cent increase has gone to 6.95 per cent is a rather interesting situation when you consider council members previously insisted the 2008 budget was written in stone. “It isn’t a question that nobody here didn’t try to cut it,” said Coun. Mary Malerby in January. “We cut everything that we could.” But obviously that wasn’t the case, because it was only a week ago that a decision was made to close the community policing office, saving more than $120,000 a year. Once again I go back to comments made by Malerby in January. “It was probably 25 to 35 hours that we did spend on that budget,” she said. If council and staff were so thorough in considering all aspects of municipal activities, why wasn’t a decision on the policing office made prior to the 2008 budget being adopted Feb. 11? District officials also claim they are able to take the axe to the tax increase now because they have a better understanding of the 2007 financial picture. A review has shown there are extra funds from higher-than-anticipated building permits, $100,000 less in RCMP costs and lower road maintenance expenses.

And that’s all positive, but once again there is a question about process. It is extremely common for municipalities to have a year-end financial wrap-up at about this time, so why wasn’t finalization of the 2008 budget held off on until that had occurred? Provincial legislation doesn’t require municipal budgets to be adopted until May 15, and that’s something council was constantly reminded of. “There’s absolutely no reason for Coldstream to gallop,” said Andy Danyliu, former Coldstream Ratepayers Association president, in January. Even Coldstream officials alluded to that fact by stating that the budget could be amended any time until May 15. If that was the case, why was there such a rush to adopt it Feb. 11? Unlike neighbouring Vernon where its 2008 budget is still being considered, the perception among some Coldstream residents is that council was only bent on getting the job done and not actually on minimizing the impact on taxpayers as much as possible. One has to wonder if we’d even be talking about a 6.95 per cent tax increase if it hadn’t been for some residents openly challenging council.

Demands from the Coldstream Ratepayers Association for forensic and management effectiveness audits were certainly over the top and highly unrealistic. But the most recent actions of council indicate the association was right to question the entire budget process and the timelines involved. In the end, the taxman won’t be digging as deep as anticipated and Coldstream’s politicians and bureaucrats deserve credit for developing a budget that balances both the interests of property owners and the community at large. But hopefully they have learned some lessons from this year and planning for the 2009 budget won’t be as painful.