A shift toward multi-year budgeting was approved by the city’s finance and administration committee of city council on May 16.
With this change, the city’s budget process will now include two-year operations budgets and four-year capital budgets.
That is, assuming city council as a whole ratifies Tuesday’s decision. With only Ward 2 Coun. Michael Vagnini voting against the plan, it’s likely to proceed. He cited a need for the city to proceed with zero-based budgeting.
Multi-year budgeting was proposed by Ward 9 Coun. Deb McIntosh earlier this year. The councillor argued the method’s potential to assist with longer-term goals was worth looking into.
This week’s meeting saw city administration table a report regarding its implications, in which they note approximately 3,000 hours of staff time would be saved in each two-year cycle by going with a multi-year budget.
This estimate, city Corporate Services general manager Kevin Fowke said, is “conservative,” and will free up staff to dive deeper into municipal service lines to cost-out activities.
“The benefits, really, are manifold,” Fowke said of multi-year budgets.
“It’s meant to strengthen alignment with strategic planning and introduces productivity improvements as well.
“It enables council to implement a multi-year vision, and allows municipalities to perform long-term planning for their financial future rather than just focusing on short-term goals.”
Although multi-year in scope, he clarified there are city council check-in points every year, during which they will be tasked with re-evaluating changing needs and priorities against the existing budget plan.
Annual business cases, which fuel much of the annual budget deliberations, will also be included as part of the annual check-in.
Initially recommended by city administration as a two-year budget across the board, Ward 6 Coun. René Lapierre amended the motion to include four-year budgets for capital projects.
These projects include infrastructure such as road work, underground pipes and buildings, which he said the city already has long-term plans to tackle.
Putting aside roads, for which the city budgets approximately $60 million per year, he said it’s easy to consolidate that into a four-year, $240-million budget within a single tender.
This way, he said the city might attract larger companies with competitive pricing.
“Larger companies want to make sure when they deploy their resources, their staffing, that it’s worth their while,” Lapierre said.
“We already know the work that needs to be done, we have a backlog of work to be done, so it’s not rocket science for our four-year budget to plan,” McIntosh said.
“We need to be taking a longer view rather than one year at a time.”
During Tuesday’s meeting, Fowke described the City of London as the “senior statesperson” of multi-year budgeting, as they’re working on their third four-year budget right now to encompass 2024-27.
It’s in the second year of a city council, after they’ve gained some experience, that they tackle a municipal budget, with annual check-ins such as which Greater Sudbury city council will perform.
Zero-based budgeting was also debated during Tuesday’s discussion about multi-year budgeting.
Though it has also been a known approach for decades, zero-based budgeting gained a resurgence of attention during last year’s year’s civic election due to several candidates pledging to push for its implementation if elected.
In a past report to city council, administration defined zero-based budgeting as follows:
“Every budget line begins at zero for each new budget period. Each cost and revenue element is assessed to determine if it is still required for delivering the business plan. Services and service levels are reviewed and changes are considered to find a result that achieves desired financial objectives.”
During a presentation to city council last year, CAO Ed Archer said the approach might be helpful, and if adopted on a gradual approach through the city’s 58 lines of service, could yield savings. Doing it all at once has been called too labour-intensive to be worthwhile.
An audit of the city’s zero-based budgeting potential by city auditor general Ron Foster is anticipated to be tabled by June 20, and city CAO Ed Archer said pursuing zero-based budgeting could be developed as a “parallel exercise” to multi-year budgeting.
“The multi-year budget anticipates that there’s some expectation for continuous service, and while that can certainly evolve and change, a zero-based discussion first would level-set,” he said. “That wouldn’t be the approach we would recommend, but that’s absolutely an approach you can take.”
As a refresher in advance of the anticipated June 20 auditor’s report, McIntosh said she planned on forwarding a 2021 report on zero-based budgeting, which Sudbury.com reported on in a Fact Check Friday, to her colleagues.
Greater Sudbury city council is scheduled to receive a budget update on Sept. 19, and undertake community consultation for the budget between September and October.
City administration’s budget, following city council direction, will be tabled on Nov. 15, and is slated to be debated by city council in December and implemented in early 2024.
The city’s operations budget is anticipated to encompass 2024-25, and the capital budget will cover 2024-27.
Tyler Clarke covers city hall and political affairs for Sudbury.com.