The average homeowner in Prince Rupert faces an extra five percent on their taxes for 2008, as Prince Rupert city council gave their first approval to proposed tax increases.
That’s an increase of one per cent from last year when taxes for 2007 went up four percent
and a jump from 2006
when the city collected an extra 500,000 dollars from civic taxpayers. Quick math tells us that’s about a 13-15 per cent jump in three years.
For 2008 the average homeowner with a house valued at 147,000 dollars will find that they need to provide an extra sixty six dollars to help the city meet its financial goals, obligations and aspirations in 2008.
By a vote of four to two, council approved the plan to go to the well of local homeowners to help to fund upcoming expenditures made up mainly of pay raises for city workers and the hiring of an additional RCMP officer.
Other key expenditures for 2008 include repairs to the arena roof at a cost of 95,000 dollars, a ferry refit expense of 50,000 dollars and for a plan to keep 42,500 dollars in additional grant money destined for the museum.
Councillor Kathy Bedard led the tax and spend side of the agenda by declaring that “people do not want to see any further cuts to services and that the proposals to reduce the five per cent increase wouldn't be worth the pain.”
Councillor Thorkelson suggested that many Rupertites had bought into the theory that the Container port would have the city rolling in money (a theory that seems to have at least had some help from some occupants of city hall
over the months) but that hasn’t been the case, as it will be jobs associated with the port development, that will change things and that most anticipated day has not happened yet.
We should point out though that it seems that the city doesn't seem to have been particularly pro active in the Industrial development side of late, relying instead on the pull of the Port Corporation, the rather short tourism season and a somewhat whimsical wish that the pulp mill would somehow return to some form of operation as its main planks for industrial development.
The Mayor observed that the city's taxes have not increased as much as other municipalities, pointing to Terrace which may only have a tax rate of four per cent this year, but will rely heavily on reserves to conduct the business of the city, while Rupert works on a cash in – cash out basis.
Locals will be looking over those ten year tax statistics carefully, as the perception in Rupert over the years is that this is one of the most heavily taxed communities in the province, especially in the business taxation sector, a suspicion backed up by recent think tank reports
In addition to the rising home taxes, the movement two years ago of the city utility bills to the start of the year with their own increases of 2007
didn't do much to dissuade local voters about their share of the burden.
Councillor Cote seemed to revisit the Pandora ’s Box of the fire department in his commentary that the city needs to revise some of its “big ticket items”
for 2009 including the fire department, funding of grants and in the area of by law enforcement. Visions of the mixed paid/volunteer fire department prospect spring to mind
and the anxiety and concerns that the suggestion caused the last time the trial balloon was floated.
The recent labour agreement with city workers didn’t seem to gain much of a discussion in the budget run up, and while no one begrudges a long overdue pay increase to the city’s dedicated workforce, the recent settlement numbers are a little hard to figure.
If the city is in such financial straits that once again they need to raise taxes, you have to wonder if perhaps the negotiations could have been a little more beneficial to those that have to pay the bills.
Some critics of the city point to particularly well compensated recent hiring’s over the last few years in the administration department as being of interest, as well as the reliance on consultants of late on any number of issues, especially considering the constant state of crisis that the finances seem to dictate.
There are a number of areas that the city needs to conduct a meticulous review of its operations and subsidiaries, in order to determine whether we are on the correct path as far as revenue generation and proper civic financial stewardship.
It might make for a rewarding approach for the upcoming municipal election campaign this fall, where a blue print for the future steeped more in facts and less in unfulfilled expectations could come in handy.
The declining home ownership base (and taxpaying and voting pool), which seems to continually be the ATM of choice for council would appreciate the details and perhaps a break from the frequent need to pull out their wallets.
Four months later those rising house prices and a municipal budget with a number of spending requirements included seems to suggest that yes, it apparently did mean that taxes would increase...
The Daily News featured the developments at city hall as their front page story in Tuesday's paper.
PROPERTY TAXES RISE BY FIVE PERCENT AS BUDGET FIRMS UP
Councillors decide not to make fresh wave of cuts but to spend on services
By Leanne Ritchie
The Daily News
Tuesday, April 29, 2008
Pages one and three
In a four-to-two vote, Prince Rupert city council gave preliminary approval to a five per cent tax revenue increase over 2007 levels.
The increase is expected to cover a three per cent raise for the majority of city workers as well as fund one additional RCMP officer. The rise in property tax will cost a homeowner with property valued at $147,000 about $66 more each year.
The decision came after council instructed staff to provide it with options to reduce the proposed five per cent increase by one to 1.5 per cent at their last council meeting. Each one per cent increase represents $100,000 out of the city's budget.
While Coun. Ken Cote and Tony Briglio wanted city staff to look at cutting another $38,000 out of expenditures as well as cutting $50,000 out of the grant budget, Coun. Kathy Bedard, Joy Thorkelson, Sheila Gordon-Payne and Mayor Herb Pond felt the average household could afford the $12.50 difference between a five per cent and four per cent tax increase.
Coun. Kathy Bedard said that people do not want to see any further cuts to services and that the proposals to reduce the five per cent increase wouldn't be worth the pain.
Staff suggested council cut five per cent by not adding the additional RCMP officer, a saving of $87,000 to the city, not repairing the arena roof (saving $95,000), not putting aside $50,000 for the 2009 ferry refit and reducing the grant to the museum by $42,250, which would keep the museum grant at 2007 levels.
"All this would do is delay the inevitable," said Bedard. "To look at delaying these specific infrastructure items would do more harm than good."
She said people want infrastructure, fixed roads and security; they don't want to see reduced recreational facility hours.
Coun. Joy Thorkelson noted that city staff have already stripped $176,000 out of operations compared to last year and to ask them to do any more with any less would be detrimental to morale.
"If anyone thinks we have a huge slush fund, they are sorely mistaken," she said.
"The city is going to fall apart if we don't look after it," said Thorkelson who added that a lot of people bought into the idea that the city would be rolling in money when the new container terminal opened, but it wasn't the jobs from the port but associated manufacturing that would bring prosperity. And that has not happened yet.
"And it hasn't helped that the U.S. is having a housing crisis and a recession in the banking industry, that hasn't helped our port," she said.
Prince Rupert Mayor Herb Pond said over the past 10 years, the city's taxes have not increased as much as other municipalities. And while Terrace is proposing a four per cent tax increase this year, they are proposing to operate using a significant amount of their reserves from previous years - about $2 million. The city, meanwhile, will be operating on a cash-in, cash-out basis - only spending what it receives.
However, Coun. Ken Cote noted the city is taking in an additional million dollars this year in gaming revenues from Chances Casino, as well as $650,000 from Maher Terminals.
He suggested the city has some big-ticket items it needs to look at revising in order to achieve future savings for 2009. These include the fire department, grant funding and bylaw enforcement.
Other suggestions brought up at last week's public meeting included revising the structure of the airport ferry, which after deducting fares and other receipts still costs the city about $1 million a year to operate, and the Alaska Marine Highway Ferry dock.
"I believe there are places we can look at where the city can save money," said Coun. Sheila Gordon-Payne, however these would only get started in 2008 and it would not be until 2009 that their full financial effect was felt.
The budget will be presented to council for fourth reading and adoption at the next meeting.