A new report finds Saanich (along with Greater Victoria) on an unsustainable path when it comes to municipal spending B次元官网网址� to the detriment of ordinary residents. But the report also shows that Saanich is improving its performance.
The report from the Canadian Federation of Independent Business says that the average family of four could have saved $7,695 in municipal taxes over 10 years, if municipal governments had maintained sustainable spending levels. According to the CFIBB次元官网网址檚 definition, municipal spending is sustainable if it tracks at or below the rate of inflation plus population growth.
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While the reportB次元官网网址檚 commentary does not single Saanich out, it indirectly criticizes the municipality.
B次元官网网址淭his year, only three of the largest municipalities made it into the top 20 out of all 152 municipalities assessed on fiscal sustainability: Port Coquitlam, Maple Ridge, and Kelowna,B次元官网网址� reads the report. B次元官网网址淭his is notable because we should expect the largest municipalities to be leaders in providing value to their residents.B次元官网网址�
As the 12th-largest community in British Columbia, Saanich ranked 69th out of 152 municipalities. According to the report, SaanichB次元官网网址檚 real operating spending per capita rose 35.5 per cent between 2006 and 2016.
This said, SaanichB次元官网网址檚 spending (as measured by CFBI) has hit a plateau B次元官网网址� at least for now.
Looking specifically at 2015-2016, operating spending per capita growth actually shrunk 0.1 per cent as SaanichB次元官网网址檚 population grew by 1.7 per cent, while its real spending grew by 1.6 per cent with all figures adjusted for inflation. This improvement ranked Saanich 8th among communities in British Columbia.
Aaron Aerts, CFIBB次元官网网址檚 western economist, said Saanich has made improvements in the short term, but only after a period of considerable growth, adding Saanich needs to maintain that progress.
Stan Bartlett, chair of the Grumpy Taxpayer$ of Greater Victoria, said SaanichB次元官网网址檚 improvements are negligible year to year. B次元官网网址淭here are 11 other of BCB次元官网网址檚 20 largest municipalities that ranked better at spending the public dollar and fiscal sustainability,B次元官网网址� he said. B次元官网网址淪aanich has a major infrastructure deficit with an aging fire hall, maintenance yard and police building, all that need dealing with head-on. ThatB次元官网网址檚 not been done yet, so in our view, debt is artificially low and operating costs unnecessarily high.B次元官网网址�
Victoria, meanwhile, ranked 76th for the period between 2006 and 2016, and 12th for the 2015-2016, with a population growth of 0.7 per cent and a real spending growth of 1.7 per cent.
In short, the report shows Saanich and to a lesser degree Victoria, are changing their short term habits, following years of what CFIB considers unsustainable spending.
The report makes six recommendations, starting with the appeal to limit spending increases to no more than inflation and population growth. Not surprisingly, the report calls on municipalities to identify B次元官网网址渟uperfluous costs and ways to increase revenueB次元官网网址� and take B次元官网网址渕easures to reduce the gap between what individuals pay in property taxes and the amount paid by small businessB次元官网网址� as business owners in British Columbia pay on average over two and a half times more property taxes than residents on the same assessed property value.
One recommendation calls on municipalities to work with the provincial government B次元官网网址渢o reform how bargaining works, with a particular focus on ensuring a municipalityB次元官网网址檚 ability to pay is consideredB次元官网网址� as part of a larger agenda to limit increases in wages and benefits.
B次元官网网址淭he government needs to exercise restraint when providing employees with wage increases such that private wages can catch up with the public sector,B次元官网网址� it reads. B次元官网网址淎 big factor why this is the case is the current collective bargaining and arbitration process.B次元官网网址�
Aerts said this recommendation should not be read as an attack on collective bargaining.
B次元官网网址淚tB次元官网网址檚 a call for reforming it,B次元官网网址� he said.
Surprisingly, the report does not reference the Employers Health Tax (EHT), whose introduction by the province will leave many municipalities including Saanich in a financial pinch, if not worse.
According to one Saanich staff report, the EHT coupled with rising labour costs as per labour agreements could lead to a five per cent hike in property taxes, if not more, in light of other unknown and unforeseen costs, such as clean up of Regina Park.
Aerts acknowledged the pending impact of the EHT, noting CFBI has been very critical of it, because of its impact on municipal finances. He said future reports will have to consider it.
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