Council accepted for information a presentation last week outlining the progress made so far towards Sundre’s first-ever four-year operational budget and 10-year capital plan.
Chris Albert, director of corporate services, outlined during the Nov. 26 special meeting some highlights from the updated and streamlined format that breaks down the once several hundred-page document into an easier-to-digest 26 pages.
Absent from the meeting were councillors Rob Wolfe and Charlene Preston, while Coun. Cheri Funke participated by phone.
“There will be more justification and more explanations coming forward as council asks questions and requests more information. Over the coming two weeks before we get to a finalized budget, the intention is to make it as a learning process, so it won’t all be tonight,” said Albert.
Administration’s goal, he told council, is to attempt to incorporate as much of the Municipal Government Act’s intent of planning for the future into how the budget is prepared.
“The purpose is predictability. We want residents, we want managers, we want departments to have a nice, firm grasp of where we’re going over the four years.”
The objective is to outline a good plan and to minimize the number of changes to avoid reinventing the budget every year while only tweaking the document as needed based on new information, he added.
Under the municipality’s previous budgeting philosophy, Albert said his understanding is that the starting point was the amount of anticipated revenues for the given year and trying to fit expenditures within that frame.
“We’re trying to turn that around a little bit, and basically say, ‘What are our expenditures, what do we need to spend?’”
That way, come the May time frame to determine the mill rate and requisitions, the calculation becomes a simple flow-through since expected expenditures have already been determined, he said.
“That’s why there’s not a lot of tax implications put into this budget. Right now, we are trying to focus on the expenditures side.”
Inflation rates played a role in how the budget was drafted, he said.
“We’re pretty far along in 2018, so we’ve got a pretty good indication of what the cost of living adjustment is sitting at right now,” he said, citing an estimate of approximately 2.8 per cent.
“To forecast for our 2019 budget numbers, any numbers that we deem are subject to inflation, we’ve applied 2.75 per cent.”
For subsequent years — 2020-2022 — an inflation factor of 2.5 per cent was accounted for, “which is more or less the Bank of Canada’s target inflation rate.”
An additional inflation factor was included to account for budget items impacted by the carbon tax, such as electricity, natural gas, and fuels, he said.
“We don’t quite know where carbon tax is going,” he said.
“But the assumption that I’ve built into the system is that carbon tax will have an inflation rate of about three per cent…We’ve just kind of grossed it up that little extra bit to give ourselves that cushion.”
The director of corporate services then proceeded to go through individual departments to give council an indication of the changes that have been made.
Among the changes is a modest salary hike in 2019 as well as a significant increase anticipated in 2020 for the bylaw department, he said, citing the addition of a part-time support position next year to assist the community peace officer.
“In 2020, there is potential discussions for a second bylaw officer. So that is why those numbers have been increased,” he added.
According to the budget summary provided to council, the bylaw department was expected to represent an expense of about $92,000 in 2018, with that amount set to increase to $114,000 next year followed by a potential jump to almost $233,000 in 2020 before being forecast to settle closer to $190,000 the following two years.
Additionally, there have been various discussions with the fire advisory committee, which is requesting a significant increase in fire services honorariums, he said.
“In 2019 and 2020, they would like increases of 20 per cent per year,” he said.
“That would equate to approximately $20,000 each of those years, and then another $10,000 in subsequent years.”
Furthermore, fire services also has additional requests for supplies deemed by the committee necessary to ensure the fire department can do its job as well as possible, he said.
The summary states a budget of $37,000 for 2018, with the forecast increasing in 2019 and 2020 to almost $44,000, reaching $57,000 in 2021 and $69,000 in 2022.
“The thing to remember with fire services is it’s a 50-50 split, for the most part, with Mountain View County. So whatever budget we approve, we have to coordinate with the county as well, but I believe they were on board.”
Another big change that does not necessarily equate to an increased cost is the roads department, which is considering hiring another employee to reduce dependency on contracted third-party service and the associated expense, he said.
“If you look at the two budgeted numbers, 2019 versus 2018, salaries go up, contracted services go down.”
In light of Greenwood Neighbourhood Place Society’s recent funding request, Albert said he also opted to factor into the budget an increase of $30,000 for Family and Community Support Services so council can see how that impacts the budget.
“That is completely within council’s discretion.”
Along those lines, the draft budget is also accounting for a five-fold increase of available funding for third- party, non-profit organizations.
“I believe the number used to be only about $3,000 in previous years that we’ve had available; it will now be closer to $15,000 that we could potentially have available,” he said.
Overall, many costs have remained fairly consistent, with most increases largely being attributed to inflationary adjustments, he said.
“We haven’t added a lot of new programs or anything like that.”
However, some studies that could be beneficial have been identified and funds are also earmarked for restricted surpluses, either of which council could choose to cut if needed, he said, expressing confidence that the municipality “is in a very good position.”
While members of council mostly opted to submit followup inquiries by email, there nevertheless were several comments.
Coun. Paul Isaac said the new format should include the former version to better illustrate the changes, while Coun. Richard Warnock said he found the streamlined 26-page budget easier to understand.
Coun. Todd Dalke also said he likes the new format, but would still prefer to see the more detailed document outlining plans and projects such as a specific street or infrastructure upgrades rather than, for example, a mere reference to "roads."
Albert said the four-year budget, which he called a working document, is going to be revisited annually, and that the process will continually evolve.
The summary states that the 2018 budget anticipated almost $4.1 million in tax requirements, a figure forecast to reach $4.2 million next year, $4.4 million in 2020, $4.5 million in 2021 and $4.6 million in 2022.
