Penticton City Council passes 2017 budget with 4.36% tax hike
After three full days of deliberations, city council on Thursday passed a 2017 budget that shaved less than one point off the five per cent tax increase proposed by staff.
By a 4-3 vote, council settled on a 4.36 per cent tax hike that will cost the owner of an average $369,000 home in Penticton an extra $89 this year, based on current mill rates. It follows on a 5.5 per cent tax bump in 2016.
Approximately 1.5 per cent of this year’s increase is due mainly to inflation in staff costs, while another 2.1 per cent will add $900,000 to a reserve earmarked to tackle the city’s infrastructure deficit.
Coun. Max Picton hailed the budget’s bottom line as striking the right balance between maintaining momentum and addressing the city’s crumbling facilities.
“I’m extremely happy with this number, and I think that most of Penticton should be as well,” he said.
“We’re not only moving this community forward still, but we’re actually taking care of some of the stuff we got behind on.”
Coun. Judy Sentes was part of past councils that maintained flat – and even decreased – taxes that caused the city to get behind, but acknowledges now that was the wrong approach.
“While we were very well-intentioned… I do believe in hindsight we were harmful, because we now have to catch up,” she said.
Coun. Tarik Sayeed described putting a large chunk of tax dollars into the infrastructure reserve as “a very responsible decision.”
And while he initially lobbied to use last year’s asyet undetermined budget surplus to bring the tax increase down to an even four per cent, Coun. Campbell Watt later agreed with staff that doing so would be unsustainable in the long run.
“I believe staff has done a remarkable job putting their department budgets together,” he added.
Council’s deliberations yielded just $50,000 in actual spending reductions – all from the economic development department – along with a host of accounting tweaks that helped shave a total of $182,000 from the proposed operating budget.
Tweaks included increasing the projected revenue from the host community gaming grant and reducing the policing budget to reflect expected job vacancies.
All told, the operating budget for 2017 stands at $68.6 million, up $2.9 million from 2016. Increases to the cost of protective services account for $900,000, while the creation of four new jobs adds $463,000. Capital spending is set at $16.4 million.
The three council members who voted against the budget all wanted to keep chiselling away at the tax increase.
“I think there is probably some room in a lot of the departments to shave another $10,000 here or $20,000 there,” said Mayor Andrew Jakubeit.
Coun. Helena Konanz urged colleagues to vote against hiring a new bylaw officer – “We’re already adding three other positions” – and work with staff to fine-tune their numbers.
“Every year I’ve been on council, staff has asked for more than they can possibly use. It’s been millions of dollars in surplus,” said Konanz.
Coun. Andre Martin also thought it premature to pass the budget without more work, especially on a revised paid-parking strategy due from staff next month.
“It’s unfortunate that we’re going to vote on this now, because I did throw a few ideas out there,” he said.
Council is set to give first three readings to the budget March 7, with final adoption slated for March 21.