Taxation is tricky business. Without it, a community can be vague and dislocated, the spirit of ownership banished in favour of hyper individualism. On the other hand, high taxes sew discontent in pretty abrasive ways, especially if programs and services seem tattered or tired.
It's a balancing act, and the District of Squamish (DOS) has only recently shown up on the tight rope, well behind the budgetary manoeuvres of neighbours like Whistler. And yet, the challenges and problems come as no surprise. Expenses are up, thanks in no small part to new policing costs. At the same time, revenue streams are strained, and the public appetite for higher taxes is minimal, especially after last year's 11 per cent increase.
"We are very concerned about the implications of our budget on the taxpayers," said Councillor Rob Kirkham, chair of the finance committee. "So that's the way we're looking at it, to do everything we can to not have taxes increase, to be responsible, to keep things under control so people aren't being hit with unreasonable tax increases. We should be doing that at the best of times, but with the situation that's out there we have to do everything we can to keep things under control."
Though late in the game, the finance committee is wading into its work at a streaking speed. An open house has been set for the week of March 23, and William Roberts has been commissioned to workshop the new council. A three-hour meeting this week produced six recommendations to council, and one of them has taxation right in its crosshairs.
Though Director of Finance Ralph Hughes suggested tax increases as high as 17.5 per cent, the committee is recommending that council have staff look into a four per cent cut on the $15 million property taxes brought in last fiscal year. That would translate into a claw back of roughly $611,000.
"We've got to question everything," said Councillor Paul Lalli. "It's about having that debate."
Hughes was vexed over the recommendation, warning that a four per cent cut would surely result in layoffs.
"It's about having that debate with realistic numbers," he said.
A 17 per cent tax increase is fantasy, Lalli shot back. He said council should discuss the cut in camera. In camera sessions are confidential. According to Hughes, staffing costs equal roughly 80 per cent of tax revenues.
There are a few other options aside from layoffs. Some of the largest single spending increases come from policing. Though the 2006 Census put Squamish's population below 15,000, the province has said otherwise, which makes the district responsible for 90 per cent of its RCMP contract. The district is arguing a technicality with the province, but talks haven't been productive and a $500,000 impact is likely. Further, the district is expected to chip in for an integrated teams strategy, which would see the creation of specialized police forces to deal with drugs, gangs and other crime niches. That cost is $300,000.
"We're arguing that with them," said Kirkham. "It's not going very well."
During a 300-strong phone survey conducted by the district, a number of residents spoke out against the RCMP, calling them ineffective.
A majority of survey respondents indicated tolerance for a modest tax increase, with most settling on five per cent as a reasonable threshold.
If the RCMP costs hit the budget full scale, as they're expected to, then there's a chance service fees will be jacked up at points of purchase, such as the swimming pool. Further, utility rates are set to increase, a fact that offers additional revenue without raising property taxes. Water rates will jump four per cent, while sewer will go up by six. During the committee meeting it was thought that those heightened rates could ease some of the burden, but utility revenues must be spent on utilities. For example, the new sewer rates will cover the $240,000 cost of composting bio-solids. Left over will be $121,000 for capital projects and $25,000 for reserves.
Aside from the RCMP, there are some other major costs to consider, including the fire department's $500,000 request for a new truck, which was turned down last year. There are also capital projects, like dredging the Mamquam Blind Channel and setting up the bike lane network, to think about. If successfully managed, each would be cost shared with another level of government; the former would run the district about $333,000, while the latter would be budgeted at $229,000.
Debt repayment is also an issue. According to Kirkham's numbers, the district's debt load is steadily increasing. This year, it's $1.5 million. Last year, it was $1.3 million. The year before, it was $1.2 million.
The budget process will again test the district's new committee structure. In previous years, council as a whole has gone through the budget line by line. This year, committees will work with their departments to establish spending priorities, and the finance committee will oversee the whole operation before making recommendations to council. The public is expected to participate through open houses, as well as online and via surveys.
And yet, the committee structure, which is designed to streamline debate, ran ashore in a recent meeting of regular council. When the economic development committee recommended restructuring the Squamish Sustainability Corporation, Councillor Patricia Heintzman said all elected officials should've been in on the debate, effectively expressing a lack of faith in the committee process. However, when the finance committee's recommendations hit the council floor on Tuesday night, they went through relatively smoothly.
The next steps are many. Staff will be identifying Olympic-related expenditures in the coming budget, as well as doing an inventory of federal grant opportunities. Prioritization is key, with Mayor Greg Gardner encouraging all citizens to come out to the open house and make their views well known. In tandem, staff departments will be putting forward their own priorities.
In the end, Squamish's budget will be worth over $20 million. Whether taxes increase or spending is cut, financial architects are not expecting to please the whole community.
"We have to walk the edge of the line," said Kirkham. "I understand that some people won't be happy, and I'm prepared to accept that."