THUNDER BAY – Thunder Bay’s city council has approved cuts to staffing and services in order to limit tax hikes in the 2023 municipal budget, but just where those cuts will fall remains to be seen.
That uncertainty worried a number of councillors who voted against the measures during the final review meeting to set the budget on Tuesday.
“I’m very uncomfortable not knowing what I’m voting on, other than this arbitrary number,” said Coun. Andrew Foulds, warning there could be regrets when the cuts play out later this year. “I’m being asked to make a decision tonight, and I have really no idea what it means.”
Others, like Mayor Ken Boshcoff, said moves to rein in the city’s spending and workforce were long overdue.
The city will also dip into its reserves to blunt the impact of higher spending, with council tentatively approving a budget that uses close to $3 million in savings to subsidize operations.
That could leave council scrambling for options to replace that one-time funding next year, staff warned.
Council will have one final chance to make changes when it votes to ratify the budget next Monday, after hearing feedback from the public on Thursday. Residents can learn how to submit feedback at the city’s website.
The tax levy increase stood at 5.1 per cent, or 4.5 per cent after growth, at the end of Tuesday’s meeting, which stretched past 2:30 a.m.
That translates to a tax increase of just over $72 per $100,000 of assessed value for residential tax payers, city staff estimated – meaning the owner of a home valued at $300,000 would pay roughly $216 more in property taxes this year, for example.
Council settled on a tax levy increase midway between the 6.2 per cent proposed by administration and the three per cent the Thunder Bay Chamber of Commerce called on the city to achieve.
Much of the reduction came through two actions council approved Tuesday, directing administration to find $700,000 in staffing cuts and $500,000 in service cuts by June.
Both of those actions were included on a menu of possible cuts that city administration delivered after council requested options to limit the tax levy increase.
City manager Norm Gale noted administration recommended against the cuts.
“There are many people – stakeholders, segments of our society – who will not be happy with the result,” he said.
Gale told council the staffing cut would mean letting go around seven employees, but couldn’t yet say which departments would be targeted.
While that prompted some concerns, Coun. Trevor Giertuga said those were overblown for a plan to cut seven people from a municipal workforce of over 1,300 full-time employees – and added it only began to roll back years of staffing expansions.
Council rejected a push by Boshcoff to double the requested service cuts to $1 million.
Meanwhile, council narrowly voted against asking police to consider reducing their request for nearly $4 million in new spending, the single largest cause of this year's tax increase.
Other actions council approved from administration’s list include eliminating summer transit service to Chippewa Park, cutting a staff training budget by five per cent, reducing a taxi scrip program for LIFT+ users, and scaling back security at Prince Arthur’s Landing.
Council voted to end operations at the DSSAB-owned Vale community centre, saving more than $100,000 a year, with staff reporting the facility was booked only 12.5 hours a week during peak season.
On a 7-6 vote, council also opted to stop operating the Jumbo Gardens community centre, and will explore options to lease the facility instead.
Council also voted to fund $1 million in operational costs from the city’s vested property rehabilitation reserve fund, rather than the tax levy.
The reserve exists to help prepare properties for tax sale, but had not been used in the past five years, noted mover Coun. Trevor Giertuga.
Some, including city treasurer Linda Evans, called that a bad idea, since it funds a permanent budget expansion with a one-time source of revenue.
Budget chair Coun. Mark Bentz said the strategy only pushes financial pain to next year's budget, when council would be forced to raise taxes to cover the $1 million, or find equivalent cuts in the budget.
Some other potential cuts were rejected by council.
Coun. Brian Hamilton, for example, moved to postpone an affordable access pilot that would offer discounted transit and recreation passes to up to 250 low-income residents. That would have saved around $115,000, but was defeated with only Hamilton, Boshcoff, and Coun. Rajni Agarwal in favour.
Council narrowly voted down a proposal to cut spending on anti-racism work by $15,000, which would have impacted the city's incident reporting line and support for council’s Anti-Racism and Respect Advisory Committee.
“My concern I guess is for other councillors and how this would be articulated in the news,” said Coun. Greg Johnsen. “Are we going to be accused of not being in favour of anti-racism efforts?”
Couns. Aiello, Agarwal, Bentz, Etreni, Zussino and Mayor Boshcoff then voted to cut the funding, losing on a 7-6 vote.
Some of those councillors pushed back on Johnsen's point, noting the overall anti-racism budget would still have been increasing slightly even with the cut they supported.
A push by Coun. Albert Aiello to cut the Thunder Bay Public Library’s proposed budget by $100,000 also failed, with some councillors asking why the idea hadn’t been raised when the library presented its budget to council last week.
“I don’t think it’s fair to pull this on any organization without any warning,” said Boshcoff.
The mayor added he might support the proposal if the library were given a chance to respond.
Council also left several cost-cutting options presented by administration on the table. The idea of cutting weekend road and sidewalk snow plowing to save just under $100,000, for example, found no takers.
The tax levy is the total amount of money the city collects from its tax base. The levy increase doesn't necessarily match what property owners see on their tax bills, which is also influenced by factors including property assessments and which tax class the property falls under.
Gale emphasized tax increases are being driven by runaway spending on emergency services, as well as by outside boards.
The District of Thunder Bay Social Services Administration Board (DSSAB), for example, has tentatively proposed upping its municipal levy by six per cent this year, increasing the city’s budget by over $600,000.
Excluding police, fire, EMS, and outside boards, Gale said, city spending will rise by less than one per cent in 2023.
“[That’s] far lower than is usual, and not enough – regardless of inflation – to sustain city operations as they stand now. The math and the numbers just simply don’t work.”
That dynamic is putting tremendous pressure on areas like parks, Foulds argued, where he said some employees are now “doing three jobs instead of one.”
Bentz noted that while council slightly expanded capital funding, the city is still falling short of what’s needed to maintain its infrastructure at current levels, including planning for replacement, by a whopping $20 to $30 million a year.
“We could add more to this… about $25 million more,” he said. “That’s our gap. The community needs to understand, that’s an annual deficit in our capital funding.”
Correction: An earlier version of this article stated Coun. Brian Hamilton voted in favour of a motion to cut the Thunder Bay Public Library's funding. In fact, Hamilton voted against the motion. TBnewswatch apologizes for the error.
