HRP digs down for $5.5-million in cuts
Halifax Regional Police will have to shave its 2020-21 operating budget by just over six per cent, or $5.5 million, but the police chief says the immediate safety and security of residents will not be compromised.
“Certainly from an emergency response perspective, we will always continue to respond to those 911 calls,” Chief Dan Kinsella told a virtual police commission meeting Monday.
“They are the most important. 911 calls are prioritized, threats to life are the highest, that we respond in the quickest manner and we will continue to do that.
“Our patrol response is fully functional, fully staffed.”
Kinsella said salaries and benefits make up 97 per cent of HRP’S operating budget. Subsequently, a $5.5-million budgetary subtraction has to result in fewer personnel.
Kinsella said 18 vacant positions will not be filled and 10 employees who expect to retire between now and September will not be replaced. Seventeen of those 28 unfilled positions will be sworn members and the remaining 11 are civilian members.
“That’s 28 positions that are not filled,” Kinsella said. “I think it’s self-evident that there is some work that isn’t being done. My job is to ensure that I respond to the priority issues and then cover the other areas where I can and continue to do that with the staffing that we have.”
The police department had in January presented an operating budget of $89,777,000 for 2020-21 that was approved in principle. With Halifax Regional Municipality basically bleeding lost revenues, all 12 business units were asked to recast their operating forecasts and regional council over the next couple of weeks will hammer out a new operating budget.
“We effectively have about an $85.4-million budget gap that we are trying to address,” Jacques Dube, the municipality’s chief administrative officer told the commission.
“When this COVID-19 arose we knew that we were going to be challenged with revenue costs, so all of the business unit directors were asked to revisit their budgets. They were provided with new budget targets. Those budget targets represented around $5 million for police.”
Dube said the initial revision was much more aggressive but involved permanent layoffs in each business unit. In that first draft, the police department was asked to cut its budget by $10 million or 12 per cent.
“We took that off the table after conversations with directors,” Dube said.
The CAO said the recast budget is just a temporary measure.
“We hope that within two to three years, the financial situation of the municipality will bounce back,” Dube said. “When I say two to three years, that’s a guess. We will never return to our PRE-COVID-19 way of doing business, whether it is within HRM as an organization or any other organization."
Dube and Jane Fraser, the municipality’s chief financial officer, pegged HRM’S cash-flow deficit at $188 million and a need to cut the approved-in-principle budget by $85.4 million.
“As we move into the October billing we don’t know how many people are going to be able to pay their taxes,” Dube said. “The $188 million was based on an assessment of who would be able to pay their taxes and who wouldn’t.
“We are also setting this budget year up to address future years as a precursor to what’s going to happen next year. I can assure all of you with certainty right now that next year will be worse than this year. Why, because the commercial tax base, which is based on income, and the income that they experience this year will have a direct, negative effect on the tax base or tax roll next year.”
Fraser said $44 million of the budget gap of $85.4 million is lost revenue, “money that does not come back.”
Of that $44 million, nearly $20 million is calculated to come from lost transit fares since the service was deemed an essential service by the province during its state of emergency and transit fares were eliminated. Halifax Transit’s lost fares amount to $3 million per month.
“Even when we start to collect revenue on bus fares, it will not be back to PRECOVID levels,” Fraser said, estimating 55 per cent of the budgeted fare collection for the fiscal year will be lost.
Fraser said recreation fees that are not collected for cancelled spring and summer programming amounts to $5.7 million and the deed transfer tax, in which the municipality collects 1.5 per cent of the purchase price of each property sold, will come in at $7.5 million loss for the budget year.
Interest income, suspended parking fees and other revenue streams make up the remainder of the $44-million projected loss.
The municipality has said that 82 per cent of its revenue comes from property tax payments, yet the interim payment date for tax payments has been deferred from April 30 to June 1. Fraser said about half the taxpayers have made their interim payment but big commercial accounts have not been paid.
The province has provided a $380-million emergency operating loan program for municipalities. HRM’S number that can be borrowed is $188 million, Fraser said.
“If we take the full $188 million in a loan from the province, we have to pay that back over three years,” she said. “The six-month cost of that is $31 million. My recommendation is that we would book that and have that money set aside to ease the burden on 2021-22.”
Kinsella said just over $4 million of his budget cut was arrived at through vacancy management and the other $1.49 million comes from non-compensation reductions that include contracted and external services, police equipment and communication and office equipment and supplies.
“We were able to do this without any layoffs,” Kinsella said. “We started with our vacancy management and then in the non-compensation areas, where we can make reductions and still deliver effective and adequate policing.”
The municipality’s portion of the RCMP budget, which was pegged at $26,869,600, has not changed. The RCMP covers most of the rural areas of HRM.
The commission voted 4-3 for a recommendation to have Kinsella consult with the union that represents the force’s officers and to have a finalized budget, which could look exactly what he presented Monday, ready to go to regional council by May 19.
Recasting the operating budgets of the other municipal business units kicks into gear Tuesday and Wednesday.
“All business units have been asked to share in the pain going forward,” said Fraser, explaining that different reductions were asked of each unit in accordance with its line of business.
We will never return to our PRE-COVID-19 way of doing business, whether it is within HRM as an organization or any other organization. Jacques Dube HRM chief administrative officer
Halifax Police Chief Dan Kinsella and Natalie Borden, chairwoman of the Halifax police commission, confer at a commission meeting at city hall last year.