Ladysmith Town Council held their first Budget Workshop — discussing the preliminary operating budget, an early stage discussion in the budget process.
“This is the introductory stage of the budget… there is a lot of work to do between now and the adoption time,” Mayor Aaron Stone said.
Adoption of water and sewer rate bylaws, and early budget approval of capital projects will be voted on at December 17 meeting of council. Budget workshops will be presented to council at the November 10, November 17, and December 1 council meetings prior to the final adoption.
Director of Financial Services, Erin Anderson presented a report on the 2021-2025 preliminary financial plan discussions. The Town is looking at a 5.51 percent increase to the municipal portion of the 2021 Financial Plan. Overall, the preliminary operating budget for 2021 is $19.086 million.
“Some years we have a budget increase, and we actually have a lower amount for property taxation. That’s because we’re taking into account non-market change, or what we call new construction amounts,” Anderson said. “We’re saying we’re going to keep the taxes at the same level, but use the new construction amounts to absorb some of the impact of the budget increase.”
Mayor Stone questioned the reliance on new construction amounts during the pandemic, and urged caution on relying on that revenue to fund the proposed budget increase.
“The analysis is showing that we will still be in COVID through 2021, if not the majority of 2021. I do have some concern that the economic indicators are pointing to dramatically higher unemployment and business losses. I would be much more comfortable with a more moderate budget increase that would be more apt to be offset by non-market change,” Stone said.
“I don’t believe we’re going to make up five percent on the non-market change. In the COVID reality we’re going to be living with through the next fiscal year, I’m not comfortable with anything over two percent, and frankly I’d rather see us come in at a one percent tax increase.”
The main source of funding for the Town is property taxation, including the water and sewer parcel tax.
The water parcel tax is proposed to remain at $459 and the sewer parcel tax is proposed to remain at $350. Anderson also proposed no increases to sewer rates, and garbage rates. There is a proposed 3 percent increase to the water rates — which amounts to $3.66 per quarter for a single family dwelling that uses one cubic metre of water per day.
Under corporate administration expenses, which includes: finance, corporate services, administration, information technology, human resources, community contributions, mayor & council, waterfront projects, leases & debt, bad debt, elections, and administration charges; there were some increases and decreases.
The Town has found cost savings in some areas like corporate services, but saw increased in areas like information technology due to employees working from home during the COVID-19 pandemic.
Under protective services, which includes RCMP, the fire department, fire vehicles, and animal control, there was a slight increase to RCMP funding. The Town is budgeting their funds at seven-and-a-half members as they await the hiring of an eighth Ladysmith RCMP member.
Revenues to cover policing costs are proposed to increase by 2.99%, which includes inflationary increase to wages and the Town’s portion of detachment expenses.
Some of the biggest increases in the preliminary operating budget are in parks, recreation and culture services. The largest cost — and largest increase — in PRC is facility maintenance. Part of that increase is driven by in-house custodial services.
“We have also taken on some major facilities that we have to account for,” Anderson said. “Those would be the water filtration plant, the waste water treatment plant, and the bio-solids. Those are all funded from those utilities, but this is where we account for it in the budget.”
Anderson is projecting an increase in revenues generated by PRC in 2021. COVID-19 greatly reduced PRC revenues due to the closure of PRC facilities and programs.
At the next regular meeting of council, which is Tuesday November 10, Anderson will present a budget workshop on Water and Sewer utilities.
Ladysmith residents are encouraged to review the preliminary operating budget, and the 2021-2025 preliminary financial plan discussions report. Both are attached in the agenda package for the November 3 meeting of council.
All residents of Ladysmith can submit questions and feedback to the Town via email: firstname.lastname@example.org. Or by mail to Ladysmith City Hall, 410 Esplanade, Box 220, Ladysmith B.C. V9G 1A2.
Residents may also ask questions during the live-streaming of council meetings on the Town’s YouTube page.