No one likes bad news, even more so when you’re the one who must deliver that news. So, it was no surprise last year when all but one on City Council, faced with having to deliver a 6.5% tax increase in an election year, chose to vote in favour of punting 3.5% of it to this year by using one time grant money from the Province. https://www.princegeorgecitizen.com/local-news/city-council-approves-3-tax-increase-for-2022-4998667 (The one who voted against, wanted to punt 4% to this year.) That’s just the start of the bad news for our newly elected Mayor and Council.
Budget discussions begin next week for City Council and it’s unlikely that anyone in our community is going to be happy about the result. There are always calls for efficiency within City Hall. The expectation that things could be done better or cheaper - if only someone would bother to look for it. Unfortunately, our three newly elected Councilors and Mayor will not be able to consider that for this budget, given that it was set in motion by the last Council and completed by the time they were sworn in.
If, at any point during the budget debate, a re-elected councilor suggests that they want to see a zero percent tax increase, they should be ridiculed. They knew this year would start with the 3.5% they kicked down the road from last year, plus the increase from the extra cost of debt servicing due to budget overruns on capital projects. Yet, at no point in the last year did an incumbent bring a notice of motion forward to tell staff how budget reductions could be delivered or let them know where to start the process.
The rest of the bad news shouldn’t be a surprise to anyone really. Costs have gone up at an unprecedented rate with inflation at 7.7% last year. For the City, some of that inflationary cost has been even higher. The publicly tendered paving contract for the City came in 21% higher per ton than the previous year. Council must now decide to either raise taxes by an additional 2% to offset that cost increase or forever reduce the amount of paving done yearly by 21%.
Unfortunately, the bad news for Council at budget time doesn’t end in 2023. Next year will see the impact of the closure of Canfor’s pulp line. As well there is another 1% increase for the RCMP contract, inflation expected around 5%, and the end of one-time grants from the Province for sidewalk rehabilitation, and that’s just the start. The result is likely to be a 7% tax increase for 2024.
Mayor Yu wanted a fresh perspective on the Finance and Audit Committee and appointment all three of the newly elected councilors to it. That new perspective is likely to find some cost savings inside the City, but nowhere near enough to deal with inflation running rampant. Council is left with just two options: raise taxes or expand the tax base through economic development.
Unfortunately, economic development takes time. That leaves the citizens of Prince George facing a much higher tax bill this year and next.