Tough times may be ahead as Red Deer grapples with a deep recession, provincial cutbacks and other uncertainties.
On the first day of the 2016 operating budget talks, City Manager Craig Curtis painted a snapshot of the challenges that faced administration as it crunched the numbers to craft the proposed $341.9-million operating budget.
He listed the provincial downloads, elimination of provincial grants, increase in matching Family and Community Support Services (FCSS) funding and the new carbon tax.
But despite the challenges, Curtis said the city crafted a budget that is responsible and listens to the community.
Curtis said the city has kept the tax increase as low as possible without major downgrades in services.
The proposed one-year operating budget comes with an estimated 3.77 per cent tax increase in the municipal portion on a property tax bill. That means the owner of a home assessed at $325,000 will pay roughly $6 more per month on their total property tax bill or roughly $72 annually.
“We heard a lot from the community a few years ago that they wanted us to improve services,” said Curtis. “We have settled on a service level and this budget doesn’t change to any major degree service level but it does recognize additional cost of maintaining the same service level in areas of growth.”
Examples include maintaining new roads ($183,640) and parks ($229,087) and a one-time future growth strategy ($150,000).
One per cent of the tax increase goes to the capital amenities fund including work on the Canada Winter Games, said Curtis.
The other 2.7 per cent relates mostly to inflation and growth.
Director of Corporate Services Paul Goranson told council the city saved $2 million through process improvements, technology implementation and collaboration in the 2016 budgets. Many of the projects and innovations were driven by staff, he said.
But some councillors had questions about the staffing levels.
Of the $341.9-million budget, $135.7 million is allocated to staffing (40 per cent). It does not include contracted staff which is accounted for in other areas of the budget.
Coun. Lynne Mulder wanted to see a comparison to other municipalities.
Curtis said the city is has a staffing level that is comparable to other similar-sized municipalities and organizational structure.
The city employs roughly 1,523 people including full-time, part-time, temporary and casual staff.
Coun. Buck Buchanan asked administration to take it a step forward and asked for more detailed information related to staffing and service levels.
Curtis said Red Deer not only services the city but provides regional service in a range of areas such as regional dispatch.
He said many of the staff increases over the last few years have dealt with services provided for people outside the city including water, wastewater systems and regional transit.
Coun. Ken Johnston asked about dipping into reserves to lower if not desolve a tax increase. Johnston said he would bring it up during the debate.
If the line of questioning is any indication, Mayor Tara Veer said she expects there will be rigorous debate around the line items in hopes of reducing the 3.77 per cent tax increase today.
“Council was very clear in the budget guidelines that we wanted to find innovations in savings for the community but to do that in a way that did not have service area cuts to the community, ” she said.
Veer said it is very apparent from what she heard from the city manager and the community that this is not a recession like the one experienced in 2008.
“It is a far deeper recession,” she said. “We are anticipating it to be a longer recession than it was in 2008 which will obviously have an impact on the community. But I think it is unique about the circumstances that we find ourselves navigating in the new normal is the fact of the uncertainty of the provincial government and the direct impact it has on municipalities across the province.”
Council will begin debating the line items today starting at 1 p.m. in chambers. The deliberations are live streamed at www.reddeer.ca