Mayor defends budget with larger tax increase, chamber of commerce CEO dumbfounded

Saskatoon property owners will be paying more in taxes next year than initially predicted.

Budget deliberations began on Monday and were completed late Wednesday night. After more than 21 hours, councillors voted 8-3 to pass the final operating and capital budgets. Mayor Charlie Clark stands behind council’s work, and says they all did their best.

“We got lots of feedback. We know there were some things in the budget that people wanted that weren’t there, and there are people who think that we could have cut services in other areas. In the end, we had to find the right balance between making sure we’re getting maximum value from our tax dollars and also making strategic investments and the things we need to do to ensure our city will succeed,” Clark explained.

Before the process began, administration set out its indicative rate — what it would cost the city to maintain services at their current levels for next year and in 2023.

The rates were pegged at 3.51 and 3.14 per cent, respectively. Numerous additions were approved in the operating budget, which has a direct impact on property taxes.

But after lengthy debate and several attempts to try and lower the property tax rate, councillors approved a 3.86 per cent rate increase for 2022 and a 3.53 per cent increase in 2023.

Once the operating budget was approved, Coun. Randy Donauer was the first to try and bring down the 2022 rate, with a $1.33 million dollar “global adjustment,” equivalent to half a percentage point in property taxes in the Corporate Governance and Finance Business line.

Chief financial officer Clae Hack and city manager Jeff Jorgensen told council that they already had to cut nearly $7 million from the 2022 budget, and more than $5.5 million from the 2023 budget. Adding on another $1.3 million would “build an even deeper hole” to get out of next year.

The motion ultimately was not supported. Coun. David Kirton said it would be inequitable, especially lower income residents who depend on city services.

According to administration, the impact bringing down the tax rate from 3.86 per cent to 3.36 per cent would mean a $10 dollar per year savings for the average household.

Subsequent motions by Coun. Bev Dubois to remove all Full Time Equivalent positions except for police and fire, was also defeated, as was a motion by Coun. Zach Jeffries to lower the contribution to the Reserve for Capital Expenditures by $500,000 was also voted down.

What does that mean?

The average homeowner with a house assessed at $344,000 will pay an extra $74.04 in 2022, or about $6.17 per month. The tax increase in 2023 will amount to an extra $70.43 for the year, or $5.87 per month.

Water and wastewater utilities are also set to increase about 2.5 per cent in 2022, and about 3.5 per cent in 2023, while Saskatoon Light and Power customers will see a 1.75 per cent increase on their bills in both of those years. Waste collection will become a utility in 2022, meaning people will get a separate bill for the service next year.

The $119-million Saskatoon Police budget was also approved. Eight new officers will be added in 2022, and another four in 2023. The $56 million Fire Department budget was given a thumb’s up, and will see another five positions in 2022 and the same number in 2023.

The $153 million Transit operating budget also got the green light by a 9-1 vote, with Coun. Darren Hill opposed.

Other approved expenses

Mayor Charlie Clark is also defending some of the optional expenses approved in both the capital and operating budgets.

“These are all good examples of the challenge of budgeting right now and being able to both — make sure we can bring in any expenditures and positions that are justifiable — but also meet the needs of our community as it changes and grows.”

One of those jobs, called “Assisted Collections,” was originally presented under “Operating Options,” but was moved to “Capital Expenditure Options.” Clark said the position had expired and needed to be renewed.

The position will see a city or contractor employee rolling waste collection bins from homes to the curb, and to “tip its contents” into the collection vehicle and return the cart. Council approved $50,000 for the position in 2022, and $70,000 in 2023.

Another position in the Capital Expenditures Options, would see a “mental wellness consultant” paid $109,500 in 2022 and again in 2023 to develop a holistic approach and to support city employees through “unprecedented change in the organization and society by working on a city-wide strategy to build change resilience.”

To date, the city says it has responded to mental health needs of employees though counselling services and other health benefits programs.

Two additional part-time positions will go to a seasonal painter and part-time custodian to complement the existing seasonal graffiti crew at a cost of $60,000 in 2022 and again in 2023. Administration says “there is always more graffiti reported than the crew can clean in a timely manner.”

Chamber of Commerce gives budget a failing grade

Saskatoon Chamber of Commerce CEO Jason Aebig was dumbfounded by the outcome of budget deliberations on Wednesday night

“I guess the statement from this budget is ‘all is well,'” Aebig told the Brent Loucks Show on 650 CKOM Thursday morning.

“We had every assumption that actually the proposed rate was not going to be the final rate. We assumed council was going to whittle it down.”

Aebig says it’s hard to accept that there were no additional savings in a $1.2 billion budget at a time when businesses are still reeling from the effects of the pandemic.

“The debt load being carried by small and medium-sized businesses is huge because subsidies play a role, but they didn’t fill the gap.”

“We’re dealing with labour shortages. We’ve got supply chain disruptions and of course the ongoing uncertainty of things like variants .”

Aebig believes this will stunt the city’s economic recovery, adding some businesses will have to rethink their hiring plans while others will close up shop.

Ironically, Aebig tweeted about the closure of a long-time retailer in downtown Saskatoon shortly after making those comments.

Sad news for our downtown. The closure of the store will mark the end of Birks in #yxe and #SK. Iconic Canadian company and fixture in our downtown. Points to the fragility of our economy and ongoing challenges retailers are facing. No business untouched, even longstanding ones. pic.twitter.com/X0VEWBOBP4

— Jason Aebig (@JasonAebig) December 2, 2021

Aebig said this budget shows a disconnect between elected officials and the residents they serve.

“Somebody is paying those bills. Unfortunately, we’re not at a state here where that understanding is clear. If it is clear, it’s certainly not acted on.”