Advancer of tonight’s Penticton City Council meeting

JOE FRIES/Special to The Herald 12/20/2010  
A thumbnail sketch of one of the city‘s most important budgets in recent memory will be unveiled tonight at city council‘s last meeting of 2010.  “It‘s a very important budget and a very tough budget. We‘ve been out laying on the line to everyone that we have a financial challenge, and we‘re doing our best to address it,” said Mayor Dan Ashton. A staff report introducing the draft financial plan says it features general expenditures of $54.9 million, with built-in reductions totalling nearly $1.3 million. But the five-page report, attached to the public version of the tonight‘s agenda, makes no mention of expected revenues or the all-important tax rates. “All we‘re doing is getting all the figures,” said Ashton, adding it‘s too early to discuss possible changes to tax rates.

Highlights presented in the report show a $430,000 decrease in gross expenditures and an $860,000 decrease in base service expenditures. Ashton was unable to provide details about those items, but said reduced spending, compared to last year, resulted naturally from staff reductions and the temporary closure of the community centre pool. Notably, the report says this financial plan is unusual in that it does not build in wage increases for city employees, who are currently without a contract and began collective bargaining this month. Last month, council received a sneak-peak at the budget that showed expenditures of $56.8 million and revenues of $55.1 million, for a deficit of $1.7 million. That gap was mentioned when the city axed 21 jobs just a few weeks later. “In my opinion, what we‘re trying to do is get the city back on a straight track and address the structural deficit that‘s in there,” said Ashton.

In January, city council received a preliminary budget of $56.5 million, that called for a 1.6 per cent tax increase. Councillors then trimmed away $637,000 and settled on a 2.5 per cent tax hike. Council will be asked tonight to simply approve a budget deliberations timeline, which calls for the first public open house on Jan. 6, followed by 10 council budget meetings through early February, before adoption of the budget March 7. Tax rates, meanwhile, are expected to be finalized May 2. The financial plan outlines
$5.2 million for capital works, bolstered by a $3 million transfer from the electrical utility. Work items include $1 million for road repair and maintenance, and $600,000 for a pair of storm sewer projects.

Meanwhile, the water utility‘s $7.4 million budget shows a 2.6 per cent user fee increase to help finance new borrowing of $1.7 million for the Upper Columbia project that is in the alternate approval process.
Other notables in the financial plan report include:

• Five per cent increase (50 cents) in garbage and recycling fees.

• No increase to RCMP staff level

• Grants-in-aid to stay at 2010 level.

• Combined Water and electrical utility surplus of $9.2 million.