When staff presented their proposed recommendations for the 2021 budget direction during the Finance and Administration Committee meeting on Aug. 11, it was expected that things would go pretty much as it has in previous years with councillors reluctantly approving the suggested maximum tax increase of 3.9 per cent.
Staff would then be sent off to prepare a budget document consisting of hundreds of pages to justify the approved increase. We would then spend several days tweaking the numbers until we basically arrived at an end result that differed very little from what staff had proposed.
However, after about an hour of very intense discussion and listening to various councillors questioning how we could best overcome the financial challenges that we are facing, it became apparent to me that things were unfolding much differently this time around.
For one thing, we were told that in order to achieve the recommended 3.9-per-cent target, staff would be required to find approximately $13.1 million of net levy savings. In other words, if we are going to anticipate delivering the same services and level of service that we approved in the 2020 budget, it would cost almost $23 million more in 2021.
But with a one-per-cent tax increase being the equivalent of $2.9 million, that would require a tax increase of close to eight per cent. Knowing that such an increase would be totally unacceptable, staff indicated that they would spend the next several months coming up with service adjustments that would find the required $13.1 million in net levy savings.
Once councillors began offering potential areas where we could find the savings, it was painfully apparent that we were not going to agree to anything at the Aug. 11 meeting. Furthermore, based on what we have observed with budget deliberations during the past several years, it was also obvious to me that no matter what staff came up with, council would not be happy and would end up debating everything all over again anyway.
So, if council was to approve the direction being sought by staff on Aug. 11, it would have resulted in a waste of time for staff over the coming months.
The only solution that seemed to make any sense to me was to defer the resolutions until Nov. 3. Thankfully, the rest of council agreed with the deferral. This will give us time to hold at least another five special Finance and Administration Committee meetings to consider all options for service adjustments and user-fee increases in order for us, as city council, to make the hard decisions to arrive at the $13.1-million net levy savings.
Only then should we send staff off to develop a budget that will meet the cap of a 3.9-per-cent property tax increase for 2021. The final approval of the budget should be much less controversial since council will have made all of the hard decisions beforehand.
I expect the special Finance and Administration meetings will begin some time in September and run one meeting a week for five or six weeks. During that time council will be forced to arrive at decisions about the Core Services Review, the allocation of the Special Capital Levy from 2020, the prioritization of capital projects, the identification of service level reductions that reflect the impact of COVID-19, and any user-fee increases that may be necessary to offset subsidy requirements. Everything will be on the table for debate and at the end of the process, the decisions of the majority of council will prevail.
All of this must be accomplished while at the same time recognizing our asset management plan obligations, as well as the increased demands in the areas of housing, social services, and the needs of both our older adults and our vulnerable residents who are living in poverty. We have a lot of people who depend on the services we provide. So, to come up with a $13.1-million tax levy reduction is going to be a very difficult task. But it must be done and it must be the responsibility of city councillors, not staff.
Setting a budget for 2021 is not going to be easy. And regardless of how everything turns out, or whether I agree with all decisions that are going to be made, this will be a budget that will truly reflect the vision that city council has for the City of Greater Sudbury, to be a centre of excellence and opportunity, a vibrant community of communities living together.
Robert Kirwan is the city councillor for Ward 5.