COUNCIL PAY – Members approve salary changes
Trudeau government tax changes blamed for need to increase base salaries of councillors from $23K to $43K, and the mayor from $68K to $129K for 2019
City council members unanimously approved a measure Monday to keep their takehome pay even with previous years in the face of changes to how Ottawa taxes the compensation of elected officials.
The item, near the end of a marathon year-end agenda, sparked several statements of support for the work of council, several condemnations of the federal Liberal government, and the mayor admonishing the media for improperly framing the issue.
“This affects our families,” said Mayor Ted Clugston. “I hope it will be reported responsibly from now on.”
Reports by the News on Monday morning described the three-page resolution that includes little background information, and accurately described the reasoning spelled out at council that night.
The removal of a one-third tax exemption by Ottawa for elected official’s pay reduces their net income, if gross pay wasn’t increased.
The change in Medicine Hat would move council members’ base pay to $43,150 before tax and the mayor’s to $129,650 in 2019 — seemingly doubling their base pay, but adding just $130,000 in total for nine council members.
Chief administrator Bob Nicolay stated the issue arose in the 2017 federal budget which eliminated the exemption, and would lead to councillors essentially taking a pay cut considering the new tax implications.
“It restores that to a neutral position,” said Nicolay. “There’s no net change to the net income (for councillor or mayor).”
The changes, suggested by council’s legislative review committee, would also see city administrators prepare a full review of council salaries before 2020, and include comparisons to other municipalities. That would be the first wholesale review of council pay since the current system was adopted in 1999, though its formula includes annual cost-of-living adjustments.
Coun. Kris Samraj said he supported the item, and a full review of compensation policy to depoliticize the process.
“It’s always awkward for politicians to be in charge of their own salary,” he said.
Coun. Phil Turnbull defended the change, calling it “reasonable” for councillors and especially the mayor.
“He’s constantly on the move, going to all kinds of meetings and public events,”
“We know we are in a Financially Fit program, and we’re all paying higher taxes and higher utility rates,” said Turnbull. “I’m retired and probably don’t need that, but when $11,000 goes into taxable income, it puts me in a negative position, pushing me into a higher tax bracket.”
Coun. Jim Turner said that at the end of the day, council member salaries are staying the same, and council members shouldn’t be punished by tax changes.
“What it is, is taxpayers money being transferred from Medicine Hat to Ottawa, and there’s nothing we can do about it,” he said.
Coun. Jamie McIntosh added, “We’re trying to justify why we should be getting the same pay as we got last month and we can thank the Liberal government.”
Coun. Darren Hirsch said the item came to the committee he chairs as a housekeeping item. Council has never examined the 1999 salary system because there was no need before tax rules changed, he said.
“We’re not making any additional money, and it’s been forced upon us,” he said.
Coun. Robert Dumanowski said councillors work hard for citizens and should have stable, fair compensation for the work they do.
“It’s the same pay for the same job we’ve done last year and the year before,” said Dumanowski. “It’s not a vote for an increase, it’s a vote against a decrease.”
According to the city’s 2017 annual report, which publishes compensation for elected officials and senior staff positions, councillors could accept up to about $25,000 per year in benefits — more than their stated base pay of $23,000. The average total compensation sat at $43,200 in 2017 for councillors that served all 12 months.
That same year, the mayor was paid a base salary of $68,000 and collected $55,000 in benefits, described as health and dental benefits, life and disability insurance, expense reimbursements and travel allowances.