Over the next few months, City Council will determine the 2019-2022 operating and capital budgets. These budgets will determine how much property tax you will pay next year, and for years to come.
During last year's municipal campaign, I committed to bringing my professional experience to City Council to advocate for change. I committed to bringing a fiscally conscious lens with a pragmatic approach to problem solving.
Edmontonians want to see City Council treat tax dollars as we would our own money. You want to see effective and efficient use of your tax dollars, to deliver services you need and value.
To that end, there are 4 guiding principles we should employ.
1. It’s Time to Rethink the Approach
The budget conversation usually starts by talking about what the most tolerable increase is. Councillors get lots of advice. Some say the property tax increase should be limited to inflation plus population increase. Others say set next year’s budget by applying fixed percentage reductions to last year’s budget.
This is the wrong approach.
Year after year of taking last year’s plan and adding some tolerable percentage increase or decrease is not budgeting, or planning, or managing. That approach does not begin to address inefficiencies in processes, overlap in responsibilities, gaps in communication. It does not ensure that every dollar spent is tied to a productive outcome. Sure, last year is a good starting point. But it cannot be the end point as well.
2. Let’s Find Efficiencies with Hard Targets
In 2015, City Administration started a Program and Service Review intended to look at every service and program and to identify efficiencies.
$2.8M in savings have been found. Approximately 0.1% of our operating budget.
Not fast enough. Not enough saved.
Let’s ask City Administration to start with a blank slate: examine each budget line for relevance first, and then maximize efficiencies by at least 5%.
I want to be clear - I am not suggesting we make 5% cuts to programs and services. Let’s maintain programs and services, and aim to reduce costs by finding efficiencies in processes, administration and duplication of resources.
And let’s look at whether the City is organized in a way that will lead to those desired outcomes.
This will take a while - it won’t be done before next year’s budget. But it won’t happen if we don’t get started now.
3. Edmonton is For Everyone
Our 10 year Capital Outlook, at $18.8 billion, includes $8.2 billion for transit, $2.8 billion for roads, $2.3 billion for neighborhood renewal. Summarized another way, it includes $12.5 billion for new capital projects, $6.3 billion for maintenance of already existing infrastructure.
We need to preserve our maintenance budget so we can maintain our roads and infrastructure.
We need to make careful choices about what we are going to spend new dollars on.
And we need to discuss all the things we won’t be able to do if we proceed with a big ticket investment such as the West LRT, or the Lewis Farms Rec Centre, or a freeway on Terwillegar Drive.
We need to investigate interim solutions that will address today’s needs while preserving the opportunity to invest more in the future.
That is what you will see from me on Terwillegar Drive, on recreation solutions in Heritage Valley, on transit solutions that serve all.
4. Edmonton is Where Business Invests
When our business community thrives, our city thrives. As employment grows, those people with jobs, with money to spend, build roots here with their families and invest in their community. They buy property, local goods and services, and contribute more to community when not struggling with financial hardship.
We need to make sure that Edmonton becomes far more competitive, not just competitive with Calgary, or competitive in Canada, but competitive in a global market. We need a tax system that encourages start-ups and supports scale-ups, that cultivates an entrepreneurial spirit where businesses born here continue to thrive here.
We need to listen to our business community. When they say that their cost to do business in surrounding communities is half of what it is in the city, we need to pay attention to that. When they say we need capital investments that serve all of the taxpayers, voters and non-voters alike, we need to listen.
5. All Neighbourhoods are Valued
Edmonton has always had an equitable approach to taxes. We pay proportionally to the value of the property we own. And we all share the benefits of what we invest our money in.
But there are neighborhoods that have been waiting for decades for their turn for investment.
A funding model that applies levies to existing suburbs that have not seen equitable investments for decades, or where future home buyers can look forward to levy-induced higher home costs (and therefore perpetually higher property taxes) - that is not fair.
Telling suburban neighborhoods that their current and ongoing base tax contribution will be used to build LRT or freeways or recreation centres in other neighborhoods, but that similar investments in their neighborhood will cost extra - that is not fair.
Telling developers and new home buyers that the cost of a new home in Edmonton just went up will just drive those developments to the surrounding municipalities. It will encourage sprawl, not infill. A person that cannot afford a new skinny house in Glenora cannot suddenly afford to move to Glenora because of a levy applied to a new house in Heritage Valley. They are moving to Leduc or Spruce Grove, and taking their property taxes with them.
I understand the concept of user-pay. That speaks to the business person in me. But a conversation about levies as part of this budget conversation is at best a distraction, and at worst, divisive:
Ward vs. ward.
Suburb vs. core.
LRT vs. cars.
This is not collaboration. This is not balanced investment. This is not the pursuit of equitable solutions for all.
This is the wrong approach.
Have Your Say!
This is only the start of our conversation.
- Join me at a Community Meeting on Tuesday, September 25, from 7-9pm at Brookside Community Hall (5320 - 143 Street NW). I invite you and your neighbours to join me for this important discussion about our budget and priorities. If you aren’t able to join this meeting it will also be broadcast on Facebook Live.
- Have questions for me? Fill out this Question Submission Form. My staff and I will work with you over the coming weeks and months to answer your questions whether they be about your priorities or the budget process in general.
- The City of Edmonton is also consulting the public, including this survey. I encourage you to take a look and identify your priorities for City Administration to take into consideration. More information about the City’s Financial Sustainability Plan can be found here.
I look forward to continuing to connect with you in the coming weeks and months as we set the course for the next 4 years, the next 10 years and the next 40 years.