Letter to the Editor: Mayor Moore Answers Citizen Nightingale
It is important to the City and to Council that we have accurate information out to the public. We certainly appreciate citizens coming forward with their concerns and we are happy to provide information and clarification on the points that have been raised. Residents are always welcome to contact our Chief Financial Officer who is a Chartered Public Accountant (CPA) with their questions. It’s also quite unusual to have a citizen implore us to raise taxes instead of lower them. This is a point of view that is quite refreshing!
In summary, Ms. Nightingale’s concerns were recently covered in the Telegraph’s reporting on our last Council Meeting where she expressed some of the same issues that are addressed in her letter to the editor. She was concerned that the City keep up or improve its quality of services and attractive amenities, and not focus on lowering taxes — because lowering taxes means lowering levels of service and letting infrastructure deficits build up, as has happened in the past — not only in Rossland, but nation-wide. She was concerned that the tax increases in the 2017 to 2021 financial plan may not be enough to cover the interest charges on the City’s borrowing for infrastructure improvements. She has said, “It’s irresponsible to not address the revenue shortfall, and to continue to increase municipal taxes at an artificially low rate.”
Here is a quick review of the concerns and our response:
1)” Keep up or improve quality of services”: This is being done and managed appropriately. The only area where city services were reduced was in regards to the Recreation budget, specifically the arena ice 2016-2017 season was shortened in order to keep the arena operating at maximum capacity and efficiency, and match supply with demand. Per a resolution of Council, grants to community groups are held at a rate of 5% of tax revenue, which increases year to year as a result. There has been no change to our snow clearing or removal budget
2) “We should not focus on lowering taxes“: Taxes are not being lowered and this isn’t the only focus.$250,000 was cut from the 2017 budget where staff made improvements through better use of resources and implementing operating efficiencies; this is ongoing.Council and staff are cognizant of the importance managing taxpayer funds appropriately. The City is not lowering taxes, according the financial plan proposed for 2017-2021 rates are increasing as follows for both property, water and sewer taxes.
Financial Plan Bylaw 2017- 2021
3. “We shouldn’t be letting infrastructure deficits build up”– deficits are not being built up but rather, on the contrary, we have been very aggressive about addressing critical infrastructure projects.
– 2012 – Columbia project over $6.5m- water, sewer, roads, streetscaping. This project was self-funded through debt and reserves; no grants.
– 2016 – Washington project was an over $6M infrastructure improvement funded by 33% in grants, 50% in debt and remainder with surplus in order to keep debt servicing manageable and have room for future infrastructure projects. Of the $4M approved by the public, only $3M was borrowed.
– 2017 – Spokane project is an estimated $4.4M infrastructure improvement in 2017 funded by 83% in grants, and the remainder with capital reserves. These numbers will change as the project has not been awarded or finalized yet.
– 2017 – Almost ½ million spent on Inflow and Infiltration. The project will be funded 83% in grants and will mitigate Regional Sewer Utility costs in the long term.
– 2017 – $75,000 in grant funds spent on an Asset Management Investment Plan to improve management of resources and aid in future planning the City’s $41M in asset infrastructure
4. “Concern that tax increases in the 2017 to 2021 financial plan may not be enough to cover the interest charges” – this is not correct. Interest is accounted for in our plan and has been increased in 2017 and onwards to accommodate the additional $3M in debt which will transferred from short term borrowing in the fall of 2017 to take advantage of short term borrowing rates as long as possible. Also, the debt principal payments have increased as well.
5. “It’s irresponsible to not address the revenue shortfall, and to continue to increase municipal taxes at an artificially low rate.”
There is no revenue shortfall, the budget is balanced as per the Bylaw. Finances and operations are being managed responsibly. The tax rates are not “artificially low” — that is just an opinion. According to public consultation, tax rate increases are deemed acceptable between 2%-5% and the City is striving to work within those guidelines. In addition, it is always important for Council to consider all of our taxpayers; some are more able to absorb tax increases than others. We do our best to strike the proper balance. Also, it is important to note that Council does not have the impression that our community is stagnating or experiencing negative growth. We are proud of the vibrancy of our community and the many young families who have recently moved here. Many thanks to Ms. Nightingale for opening up this topic and I hope to see lots of people at our public meeting on May 4th at 6:00 pm in City Hall. All are welcome.
Kathy Moore- Mayor