After finding savings from the closure of Canada Games Pool and tweaking proposed service enhancements, the City of New Westminster has landed on a proposed property tax hike for 2022.
At a Nov. 29 workshop, council directed staff to prepare a draft consolidated financial plan bylaw that reflects a 4.4% property tax increase for 2022. At a previous workshop, staff had outlined three proposed budget scenarios for 2022, which considered impacts of a 3.9%, a 4.6% and a 6.1% property tax increase.
The 4.4% increase includes 2.7% (for $2.6 million) in fixed costs and salary increase and $1.6% (or $1.5 million) for insurance premium increases. It also includes some permanent service enhancements for items such as increased fees for E-Comm and maintenance fees at Massey Theatre.
The unexpected closure of Canada Games Pool has resulted in some savings, with staff recommending the city use some of the $700,000 in savings to support temporary investments that advance council’s priorities. Items to be funded in this manner include: an Indigenous relations advisor; an irrigation technician; diversity, equity, inclusion and anti-racism training; and vote-counting equipment for the 2022 civic election.
Coun. Mary Trentadue said she’s not opposed to that spending plan, but wants assurances that funding will be available for programming alternatives that will be implemented in lieu of services offered at Canada Games Pool.
According to a staff report, departments requested the service enhancements as they cannot maintain their core service demands while addressing city council’s strategic priorities and/or the city’s COVID-19 response responsibilities.
On Monday, council supported the proposed service enhancement requests from staff and directed that they be incorporated in a draft consolidated financial plan bylaw. Staff will present the draft budget and five-year financial plan at council’s Dec. 13 meeting.
“Obviously, this is a tough budget year for us,” said Coun. Nadine Nakagawa. “I think it is looking about as good as it’s going to get.”
Coun. Chuck Puchmayr said there isn’t a lot of room left to trim the budget once the city accounts for mandatory salary increases and insurance premium increases. While he’s not happy with the proposed tax hike, he said it’s at a level he can support.
“I looked really closely at the engagement we did; I feel that this does get us in a fairly comfortable area. I would have liked, obviously, and I think most of us would have liked, a lower tax increase,” he said. “The general public is faced with so many increases – cost of living increases, increases in utilities – just the affordability of the tax-paying public is really being stressed right now.”
Harji Varn, the city’s director of finance, said city staff will continue to do their best to find offsets so the city is able to provide much-needed core services such as public safety, cleanliness, infrastructure upgrades and affordable housing. She noted that “significant investments” will be required over the next decade or more to deal with issues such as climate action.
“We will continue to find ways to maintain sustainable and stable annual rates while maintaining the city’s assets and key infrastructure and delivering on council priorities,” she said.
Coun. Chinu Das commended staff for whittling down the proposed budget.
“It’s as bare bone as it can get,” she said. “Personally, I would love to see this somewhere around 4% tax increase. But when I see the fixed costs and the insurance costs translate to 4.3%, and then the enhancements we are proposing are very, very minor. That has been quite challenging.”
Council members noted they’ll be having discussions in the future about some issues that are contributing to the budget increase, such as the costs of the E-Comm system and insurance premiums.
Mayor Jonathan Cote supports a plan to review the city’s insurance coverage.
“When I look at this year’s budget, I don’t think we came into the budget thinking, this would be a big thing in the budget,” he said. “But ultimately, 1.6% of these taxes is directly related to insurance premiums.”
According to Varn, insurance costs are increasing for a verity of reasons, including recent local events, such as the Westminster Pier Park fire, and global events such as fires and floods. She said the age of the city’s assets also adds pressure to the insurance premiums, as does an increase in assets, such as the city’s ownership of Massey Theatre and construction of the new aquatic and community centre.
“You can expect insurance costs to rise to protect these assets,” she noted.