The general operating budget, called the “strategic plan of operations,” was discussed at length during a budget overview at Monday’s governance and operations committee meeting.
Overall, Trail council reviewed upcoming expenditures minus the city’s 2014 revenues and within the next few months, a budget will be finalized and this year’s property tax requirements set.
For now, based on an average house assessment of $181,000, a homeowner could end up paying $854.41 in property taxes, up $54 from last year.
Factoring in an average 3 per cent increase in water, sewer and garbage, Trail taxpayers could end up paying a $73 increase, totalling $1692.11 on the average residence, which is an overall hike of 4.5 per cent from 2013.
That number could vary somewhat if council finds ways to whittle down the budget and avoid dipping into the reserves by cutting from various general government departments including, but not limited to, recreational services and grants, economic development initiatives, and costs associated with conventions council members attend throughout the year.
“I don’t want to see a reduction in reserves because we’ve been there before and it’s not a comfortable place to be,” said Gord DeRosa, a 26-year Trail councillor. “Because we could have something catastrophic happen and not have the funds to cover the costs of repairs,” he continued. “I am comfortable with a three and a half or four per cent increase (property tax), because that is palatable in my mind.”
The budget reflects the city’s immediate $207,000 revenue loss related to the end of a five-year recreation agreement with the Beaver Valley communities, however council discussed a need to review services in all Trail facilities because costs, including the library and cultural services, have climbed from $1.5 million to almost $ 4 million in the past 14 years.
“You need to go through each department and look critically at the services being provided,” explained David Perehudoff, Trail’s chief administrative officer. “And what you are comfortable with and how you have to get there.
“For example, a recreation zero-based budget is a challenge that staff would have to review and come back to council with a plan. And if it will impact services you need to be prepared to politically deal with that.”
The focus turned to the Trail Memorial Centre’s $900,000 yearly operating costs, or $2,600 per day in tax subsidy, which is not sustainable long-term, however no immediate solution has been determined to stop the bleeding of taxpayer dollars.
“We have to look at what we can do with the Memorial Centre,” said Mayor Dieter Bogs. “Even if we did something like close the kids rink, that wouldn’t make a significant difference. Something else needs to take place.”
Currently, $290 per capita (income per person) is spent for the city’s recreational programming which is out of the ballpark compared to other municipalities similar to Trail’s populace.
“You have to remember our facility was built to satisfy a population of 13,000 people,” said DeRosa. “And I’d like to point out we pay more for recreation than healthcare.”
One cost cutting measure council agreed to was a 50 per cent reduction in facility waivers across the board because in 2013, almost $47,000 in rental fees was granted to various non-profits and charitable events in the community.
“We know what great things these groups do for our community,” said Coun. Eleanor Gattafoni Robinson. “But we can’t have these numbers continue to climb and we need to tighten our reins in certain areas.”
Discussion turned to legislative services which included $17,000 allotted to the upcoming municipal election and an increase of $10,000 for the city’s 2014 legal fees.
Last year, Trail’s legal fees soared $70,000 over budget related to the ongoing sewer dispute between the city and Rossland and the boundary expansion initiative.
“We spent close to $150,000 last year which was over budget,” confirmed Perehudoff. “We are dealing with legal fees with the airport transaction and there is still some more associated costs with the sewer and boundary expansion,” he said. “This year we’ve set aside $80,000,which is standard, and hopefully it will be reduced.”
Additional cuts under the general governance services, included the nixing of $5,000 allocated to send a councillor to a Niagara Falls conference in May, and a 50 per cent reduction to the city’s $105,300 economic development program.
The meeting wrapped with further discussion about the Trail Regional Airport and concerns that the service may run at a deficit in Trail’s first year of ownership set to begin Feb. 15.
“The regional airport service cost the City of Trail $44,000 last year,” said Perehudoff. “The concern is that we may not necessarily achieve zero impact this year.”
To cover costs associated with the transfer of ownership, council elected to direct that money back into the operating budget to avoid an impact in property taxes.
The city’s net operating budget is forecast at $16.5 million, with property taxes currently set to cover $11.7 million or 71 per cent this year.