ELECTION 2014: Council candidate Q&A part 2 – City finances

City of Revelstoke: We ask the candidates for council their thoughts on city finances.

As part of our ongoing election coverage, the Times Review has posed five questions to the candidates for mayor and council. If you have a question you’d like to ask the candidates, please e-mail it to editor@revelstoketimesreview.com for consideration.

Our second question is:

The City of Revelstoke faces a number of financial challenges such as high debt, low reserves, major infrastructure issues that need to be dealt with, and pressure to lower the tax burden on businesses. What are your thoughts on the city’s finances and what ideas do you have to meet these challenges while still providing a level of service residents expect?

Gary Sulz

Financial viability is always an issue when it comes to the public purse and here in Revelstoke this seems to be a hot issue. None of us like to pay more than our fair share, especially when the business tax rate appears lower 100 kilometers down the highway. I understand that first hand when I see our annual property tax bill for our commercial building on Mackenzie Avenue.

It seems every city has to deal with aging infrastructure, growing demand for better services and fewer dollars with which to operate on. As the provincial government continues to download services onto the back of local municipalities and businesses, we all demand a better bang for our buck. We must continue to build on what previous councils have done before us, implement strategic planning for one, five and 10 year terms, and we need to continue to fine tune our spending.

One of the first issues for the new city council will be to deal with the budget, so council will need to think outside of the box and engage community members to assist us in our future fiscal endeavors. Now is the time to let me know your ideas.

Gary Starling

The city finances indeed have been under the microscope. Many concerns have been identified. These would include lack of reserves, high debt, as well as concern over departmental spending.

In the last three budgets the city and council have made many changes to address this. Departments have had to tighten up spending. As a result, our reliance on borrowing has subsided, and our departmental spending has leveled off. This trend will continue. Let’s not forget that much of our borrowing in the past few years was for infrastructure. Some of these expenditures were mandated by the province, like the water purification system.

There are still many opportunities for improvement. As well we can look at service levels in all departments. If elected, I look forward to the budget this year where we can address all these issues.

In order to lower the tax burden on business we would need to shift the tax burden elsewhere. Council took steps to move in that direction in the 2012 budget. The question is, was it enough? As always, this is a difficult issue to tackle. Shifting the tax burden to residential is a burden on low income families and seniors. The answer is to find a balance, and at the same time reduce overall spending so the tax increases are minimal across the board.

Karen Powers

For years our financial director has been warning council, and therefore us residents also, that spending and borrowing are not in control and the consequences could be disastrous. We must have a council that can sit down with our finance department and, perhaps along with respected professionals in the business community, together we must bring spending under control.

I believe there is sufficient experts within our current staff and the community to get the job done now and in the future. We do not need high-priced consultants. Only after a review can we move forward to look at tax cuts. But saving money only by reducing wasteful expenditures is only half of the equation.

We must also increase income to the city by economic development and making it attractive to develop in our city. To grow the tax base, money raised by development fees could be used to do repairs necessary. I do not believe to control the budget we should lose services to residents. The snow will come and we must remove it — that’s a cost we have always had.

Aaron Orlando

The City of Revelstoke’s long-term debt at the end of 2013 was a record $17.9 million dollars, almost double the average of all municipalities in B.C. It increased every year since 2006. In 1998, it was $132,000!

The new council has two good alternatives to deal with debt without raising taxes.

The first is growing our tax base, which means developing vacant lots the city already paid to service. A new house or commercial building brings in much more taxation than an empty lot, reducing everyone’s tax burden. We need to develop empty commercial lots at the Trans-Canada Highway, empty lots throughout town, and the many serviced but empty subdivision lots in Arrow Heights. We can attract new commercial and light industrial businesses, and new jobs.

In my platform, available on Facebook, I am presenting ways council can spur residential and commercial investment, including revitalization tax exemptions for job-creating industries, reducing the commercial property tax burden, amending development cost charges to spur growth and, most importantly, making sure our development process is customer-friendly.

The second good alternative is finding efficiencies in city operations. This is challenging, but we can do it. The renovations at city hall are not necessary, for example. That project is budgeted at about $800,000 but could cost more. The key will be diving into the complex budget process that will land on the council table in January. As a former editor of this newspaper, I’ve experienced six budget cycles and I’m ready to ensure a new council can make progress in our first budget.

Linda Nixon

The City of Revelstoke debt is budgeted to go down in 2014, while debt increased by $130,000 in 2013 largely due to appeals to BC Assessment. Borrowing for roads was halted this year. The reserves have been turned around and are increasing. There are two new reserve accounts, one to do with risk to the tax roll by appeals to BC Assessment and one to do with decreasing our carbon footprint.

The big infrastructure projects require all three levels of government working together. An example of this, and a priority, is the highway entrance to Revelstoke. The traffic log jam has to be fixed. The Ministry of Transportation has to approve our design plan. The ministry has released a statement looking for our priorities. The Trans-Canada improvements and the entrance to Revelstoke are both important. Water infrastructure is one of the areas where grants from upper government, reserves and then borrowing with long range rate recovery is the best plan.

RCFC and RCEC are both involved in strategic planning. A call for expressions of interest has Revelstoke looking at a biomass to fuel project. FortisBC is planning on upgrading citizens to gas from propane. There will be no cost to convert and conversion takes one day.

The tax pie for businesses, including manufacturing businesses, is improved by making the pie bigger. Ideas for doing this comes from the business community itself. Again the Integrated Community Sustainability Plan guides how to do this by looking at preserving the downtown core. Working with the Chamber of Commerce, business can turn the corner and rejuvenate First Street. Growing manufacturing businesses are the best way to offer affordable living jobs. Kudos to companies, businesses in Revelstoke that not only rode out the global recession but actually stimulated local growth in jobs and the economy here right at home. Call me at 250-200-0382 cell or leave message 250-837-2498. My email is Lnixon@revelstoke.ca.

Chris Johnston

Let me begin by saying that while not ideal, the city’s financial picture is not as bleak as it may be suggested by some. The level of debt is concerning, but it is not to the point of being unmanageable. It could also be noted that this debt relates for the most part to needed infrastructure like the water treatment plant.

I would also note the “infrastructure deficit” is in no way unique to Revelstoke, but is an issue in most, if not all, cities and towns in Canada. This situation did not arise overnight but over many decades and will not be completely cured overnight. Certain steps taken by the city including a comprehensive asset management plan, targets of increasing reserves and development cost charges will reduce the reliance on debt financing of projects.

There is no magic bullet but rather a series of steps that we can continue to take including efficiencies in every city department, careful asset management, a firm commitment to building reserves.

Regardless of how efficiently a city is run, it takes money and most of that money is from a pool of taxpayers. If someone in that pool pays less, someone pays more. All council can do is strive for tax fairness taking all interests into account.

I encourage all interested to take a look at the city’s 2013 Annual Report and 2014 Financial Performance Report, both posted on the city’s website, for more information on how we are doing.

Chuck Ferguson

Without seeing all the budget items and getting a better perspective on revenues this is a difficult question to answer but I will say this: Spending increases over the last couple of terms have been double digit in some departments and that has to stop.

I understand council is trying to go with no increases to the budget this year and try to not increase taxes, but we should be considering zero-base budgeting and in some cases even decreases in certain departments. Just because you spent it last year does not mean you need to spend more the next year.

Most of this budget planning is just common sense; looking for more inexpensive ways to tackle things that are necessary like snow removal and infrastructure repairs or replacement.

We need to rely more on people in Revelstoke than outside consultants. We also need to be more protectionist for city businesses and keep the money in our community instead of going elsewhere for quotes. Money spent with local business is put back into our community in the form of wages and taxes instead of leaving town.

People all over this city have ideas that should be considered during the budget proceedings. It seems when people offer alternatives and ideas they are just ignored and that means they are not being represented by their council.

If elected, that will be my priority. Revelstoke is a great city with tremendous potential and this needs to be recognized and it is certainly not too late to realize that potential for future generations.

Trevor English

My thoughts on the city’s finances are a little limited at this time as I haven’t had a chance to review all aspects of the city’s finances so, I would hesitate to get into specifics right now. I am, however, happy to talk about what ideas I have to meet the challenges that we are facing.

I think that a strategic review of the city’s finances are in order for the incoming council. The next council will have to make some critical financial decisions going forward based on creating efficiencies within all the departments in the city at all levels — public works, city hall, etc…

Working together as a team, with all departments and department heads, the next council should analyze where we can try to save the taxpayers some money while maintaining current service levels.

I believe that fiscal responsibility must be the focus of the next council and with that direction it will also be the solution to the problems you need the incoming council to address.

I want to be a part of that team, Revelstoke deserves it!

Scott Duke

It is no secret that Revelstoke faces some major challenges with infrastructure, overspending, unsustainable tax increases and mounting debt. When people inquire as to what keeps me awake at night (with regard to the city), it is hands down our current spending habits. This is not a problem unique to Revelstoke, but I hope to be part of a team that makes it a problem of our past.

To reduce debt and increase reserves there are two things that have to be done. One: reduce expenditures; and two: increase income.

To reduce our expenditures, the new council needs to be aggressive, focused and strong in this next budget cycle to find savings. The new council also needs to be keenly aware and in control.  This way overspending like the $800,000 city hall renovation can be avoided.

Equally, if not more important than trimming down, is increasing income by expanding our tax base. In life and business I have always preferred increasing income over cutting back. To achieve this we need to focus on inviting new taxpayers to our community with open arms. New residents and new business will reduce the tax burden for everyone in town and should be a major focus for the new council.

George Buhler

The city is top heavy, so a long and serious look should be had to reduce some of the marginal and unnecessary expenses. The infrastructure repairs require close scrutiny and a decision needs to be made if they are more important than more debt. The budget must recognize the debt and make adjustments to start reducing the debt before it becomes unmanageable. There may be some assets that should be sold to reduce expenses and pay down the debt.

Connie Brothers

There has been a continuous growth in spending by the city as well as a significant increase in city debt over the last several years despite difficult economic times. The problem is compounded by progressive increases in services and programs beyond necessary core services, some excessive purchases, and ill-advised spending on consultants and projects like the renovations at city hall and the courthouse roof.

The city would benefit if the following were implemented, many of which have been suggested by past budget focus groups.

Budget discussions should begin earlier in the year to assure sufficient time to analyze and review the budget. There should be a specific direction from council that each department must budget for a certain percentage reduction without disrupting core/necessary services. While reviewing departmental budgets for the current year there should be an evaluation of the prior year to see whether the budget has been met and if not, why not.

The budget focus group should be re-established to help provide ideas and suggestions from the community on the budget process. The appropriate city officials should meet with the focus group to discuss the report. Members of the focus group should be appointed for two years so there is continuity.

Savings from the budget can be applied to reducing business taxes in order to attract more business and thus increase the tax base, and beef up our reserves for future infrastructure. This would need to go hand-in-hand with economic development to increase the tax base and assist in paying city expenses.

Steve Bender

It is popular to say finances are out of control and the city is going to hell in a hand basket. It is also very negative, scary to potential investors, unnerving to anyone thinking of moving here and simply not accurate.

The province chose Revelstoke as one of the top 13 cities in which to do business in B.C. Business licenses are at a record high. Reserves are being built, for which I have advocated since my first day in office and will continue to press.

As per the charts and reports, city hall general operating expenses are down and staff was restructured and reduced. The greater percentage of municipal tax rates was shifted from business to residential.

We must continue to work hard on the tax challenge, but I will not make empty promises. No one can promise to reduce taxes over time unless the price of food, clothing, prescription drugs and other consumer items go down. Not much chance of that.

Regarding debt, ours continues to be quite manageable with plenty of leeway to borrow more in an emergency. Debt reduction is the best solution and work continues. The work never ends to find efficiencies in operating a city. The main challenge continues to be providing the basics: sewer, water, roads, sidewalks, policing, etc… The basics that are so important to attracting new residents and businesses.

The pool, community centre, new police station, new water tank, new water filtration plant, etc… are the basics that make Revelstoke attractive. I choose to be positive and continue to work on these foundations to make Revelstoke better. Once those are provided and established, private business is much better than any government could ever be at building a future.

 

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