City of Powell River is a facing a $1-million shortfall in the first draft of its 2016 budget.
Director of finance Shehzad Somji made a presentation of next year’s draft budget to the finance committee on Thursday, October 22.
Somji told the committee that staff have reviewed the city’s operations and looked for any increased costs for next year.
Somji identified about $1 million in potential new costs for the city next year, with a large portion from increases in the city’s protective services.
The city is expecting a one-time $400,000 payout to firefighters for retroactive pay increases and a further $270,000 increase for wages based on the annual provincial average. The fire department has also asked for an additional career member be hired.
The RCMP has also requested the city add an additional full-time officer salary, at roughly $150,000, to its operations for next year.
A three-year joint job evaluation process of city staff will begin next year with an annual cost of about $130,000.
The city will also look to hire a full-time planner at $56,000, communications contractors at $75,000 and pay for live-streaming meetings at $18,000. It is projected the city will spend $30,000 on implementing initiatives from its recently drafted economic development strategy.
Chief administration officer Mac Fraser said that while a $1 million variance may seem like a lot, it represents only about five per cent on the city’s overall budget, and the budget is still early in its development.
Somji asked how the committee would like the city to fund the shortfall.
“There’s no fat and no further cutting staff can do,” he said. “A lot of this is contractual.”
Somji added that the city’s departments have looked for efficiencies and have followed the city’s mandate of living within its means and there are two options, either decreasing service levels or increasing revenue.
“You’ve already committed to not [raising property taxes],” he said.
Some of the shortfall comes from one-time expenses while others are recurring. Discussion shifted to looking for potential solutions.
“What we need to do is combination of cutting, dipping into reserves and taxation,” said mayor Dave Formosa. “Each year we’ve cut departments for the past seven years.”
Formosa said the discussion illustrates exactly why the city needs to promote economic development to broaden its tax base.
“That’s why we need to increase taxation. We need industry and building. We’re getting there, but not fast enough; that’s why it has to be a combination,” he said. “Everyone is going to have to take it a bit on the chin.”
