A shrunken Downtown Business Association revised budget was approved by Red Deer City Council on Monday.
The DBA’s total operating expenses in 2021 are forecast to be $512, 300 — about 23 per cent less than the $672, 500 approved for last year.
The Business Improvement Area (BIA) levy for 2021 is $167,900 less than it was in 2020: “This is to cover the $95,000 loss of provincial levy payments that have been historically paid by the provincial buildings located in the BIA, but are no longer, said executive-director Amanda Gould.
Due to the pandemic, the DBA is anticipating up to a $40,000 reduction in 2020 levy revenue from businesses who defaulted on payment. In addition, the BIA lost a substantial number of businesses which resulted in a further $32,000 loss, added Gould.
In a letter to council, she stated downtown businesses, along with the DBA, “have endured unprecedented challenges and made many sacrifices in 2020.” But Gould added that the DBA acted quickly to cut expenses during COVID restrictions, and has access to a reserve fund to make up a shortfall.
While Gould’s pro-activity was praised, Coun. Lawrence Lee pointed out the DBA’s salaries and rent now make up 65 per cent of its budget, rather than the 30 per cent that’s optimal.
“It’s not sustainable,” added Lee, who suggested some revenue-generating ideas will be needed in future so the DBA can afford the promotional activities it’s supposed to be carrying out.
But Coun. Ken Johnston noted the DBA “was never developed to be a profit centre.” And Coun. Buck Buchanan, who pays the DBA levy for his business, concurred.
Buchanan added that while Gould is doing her “level best” to keep the levy at last year’s rate, there will be a time when an increase is warranted. “The levy’s been pretty reasonable for 15 to 17 years now.”
lmichelin@reddeeradvocate.com
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