Ad ban debate fuels concerns for municipal autonomy, funding
Concerns about municipal autonomy and a potential revenue loss mounted Thursday after a motion over fossil fuel producer-backed sponsorships and advertisements with the city sparked a war of words between the premier and some Regina councillors.
“I actually don't know what happens if it goes forward,” Mayor Sandra Masters said. She is “enormously concerned” that if the motion passes next week, the potential lost money to the budget would be the “equivalent of a 12.8 per cent mill rate increase.”
The proposed policy goes to a final vote at the Jan. 27 city council meeting.
The dispute was touched off by Coun. Daniel Leblanc's (Ward 6) amendment to the sponsorship, naming rights and advertising policy at Wednesday's meeting of executive committee (which consists of all city councillors and the mayor).
The amendment, which passed 7-4 but requires final approval by city council, would restrict the naming rights and sponsorships from any group “whose business is principally derived from the sale or production of fossil fuels.”
Calling the amendment “absurd” and “hypocritical,” Premier Scott Moe warned that, if approved, the policy could result in the province pulling $33.3 million in municipal surcharges paid to the city by Saskpower and Saskenergy.
Coun. Bob Hawkins (Ward 2) said the premier's comments were counterproductive to the function of the city.
“We're in the process of trying to come to a good decision and to label our work as absurd or hypocritical is just not helpful,” said Hawkins, one of seven councillors to vote in favour of the amendment.
He said from the recommendation of executive committee, it is up to council to listen to the public before making a final decision. “It's premature to be treating this matter as if it's decided,” said Hawkins. “The legislative process should be allowed to take its course.”
Hawkins added that the premier's interjection into affairs at city hall infringes on the autonomy of municipal governments. “It's problematic, but even more problematic is the threat that monies are going to be withheld from us if we make a certain decision a certain way. It's just not appropriate,” said Hawkins.
Municipalities of Saskatchewan (MUS) president, Gordon Barnhart agrees. While the MUS is not taking a side, Barnhart said it's crucial that municipalities are able to govern themselves.
“We very much believe that all levels of government should be able to communicate respectfully and directly and not by threat from one level to another,” he said.
While city council's integrity and autonomy is at the forefront, Masters said the city must also refrain from biting the hand that feeds it.
“Half of our budget comes from the province, in terms of transfer payments,” said Masters. “We have a hurting economy; we're in the middle of a pandemic, economic uncertainty. We need to build bridges.”
Masters said the premier's reaction is not surprising. She feels he is going to bat for a hurting industry. “I don't feel like it's being strong-armed. I feel it's a check yourself before you wreck yourself situation,” she said.
Masters said the amendment has thrown a wrench in her attempts to build bridges with the province.
“There's no mistaking that the Saskatchewan Party represents and advocates for oil and gas, and agriculture,” said Masters. The mayor struggled with the idea to deny support coming from an industry that drives the economy and employs thousands in the community. “I don't care about ideology,” she said. “I care about the citizens, the economy and social issues in our city.”
Saskatchewan NDP Leader Ryan Meili doesn't agree with the premier nor council's tactics, while emphasizing the need for municipal autonomy.
“It's not the approach I would take, limiting good employers here in Saskatchewan from advertising. But again it's not my decision,” said Meili. “And it's a good discussion to have with council — not threat
tweeting about it.”
Hawkins explained the $33.3 million in municipal surcharges are the result of changes after the 2017 provincial budget, which scrapped the grants-in-lieu program. Crown corporations are not charged property taxes, so instead cities got grants-in-lieu. After backlash from scrapping the grants-in-lieu, the province brought in the municipal surcharges.
“It was meant to be a substitute for property tax, so in a way, that's money that belongs to the city, to the citizens of Regina,” said Hawkins.
As for how the province could withhold the $33.3 million, Hawkins sees two options: for the independent boards of Saskpower and Saskenergy to approve the denial or the province could pass legislation.
In addition to the surcharges, sponsorship dollars from Saskpower and Saskenergy are worth $10.4 million to the city over 10 years, according to the mayor
The current advertising and naming policy applies to all city owned and managed assets. There are already limits on what kind of sponsors the city will seek. For example, businesses that derive their profits from the sale or production of tobacco, cannabis, pornography or sexual services, weapons or are discriminatory are restricted from advertising with the city.