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Taxes and the art of municipal maintenance

RMOW efforts to limit property tax hike to four per cent include stringent department engagement

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Suggestions that 2011 property taxes will be higher than planned are untrue, says Whistler Councillor Chris Quinlan.

In 2009, the Resort Municipality of Whistler forecasted the need for a 19 per cent tax hike to accommodate a variety of issues facing the municipality, including build out and aging infrastructure costs. The last four per cent of that hike is to take place in 2011, but preliminary budget figures for the upcoming year show an unexpected shortfall of $2.8 million due to fiscal inconsistencies surrounding transit and pay parking. But finding the extra money is not likely to mean a further tax increase.

"The direction that council has given staff is four per cent. There's no option on that," said Quinlan. "All the work we've been doing on the budget has been getting it to four per cent, so staff has some challenges ahead of them and council is going to make some decisions but there will not be a tax increase beyond four per cent."

To navigate the budgetary divide, the municipality is taking a hard look at its services and is hoping an extensive review of Whistler's bus system being conducted by BC Transit will close some of the gap.

The municipality conducted its own organizational review after the Olympics, followed by a service delivery review to identify how municipal departments can better and more efficiently manage their ministrations. After 2011, keeping tax increases to one and a half to two per cent above the rate of inflation and Consumer Price Index (CPI) will be the municipality's goal.

Departments within RMOW have been given a four per cent budget increase as part of contractual labour cost increase for 2011. If their costs go beyond four per cent, managers will have to mitigate the increases by generating more revenue; cutting expenses; reducing or cutting services or hours; providing services in a different way; or raising taxes. The first two options are considered by RMOW as having the least impact and are preferable to the others, but some departments feel they have no options left to maintain the status quo.

The Whistler Public Library (WPL) has trimmed the fat in every way possible but says a decrease in the number of operating hours is likely the only solution that will fix their department's budget woes. A final decision on the cuts was made at a board meeting on Wednesday night after Pique went to press but reducing opening hours from 53 to 44 per week was looking like the most likely avenue available to the WPL board.

"The fact of the matter is that our human resources costs are 86 per cent of our budget so we didn't really have a choice," said library director Lauren Stara. "I cut all the things that I could, things like travel, conferences, training and supplies and even when I had cut those things as much as I could I was still faced with a significant shortfall. Staff is the only place we can get the amount of money we need to make up for it."

The WPL employs five permanent full-time staff and four permanent part-time staff. The 11 casual staff members who work on an on-call basis will bear the brunt of the reduced employment.

A public survey conducted by the WPL indicated strong support for maintaining the library's current hours, but Stara said parity among departments means there is no other choice.

"The results show that nobody wants this to happen. Nobody on the staff wants it to happen, nobody on the board wants it to happen, and nobody in the public wants it to happen. But the reality is that to not reduce our hours is to get more money from the municipality and to get them to give us more money they have to take it away from someone else," she continued. "It's really a no-win situation all around."

Solutions available to the RMOW to balance the budget without raising taxes beyond four per cent involve a blend of measures, including a thorough examination of public employees. To cut costs, RMOW has decreased employment levels where possible, essentially eliminating positions as people move on. A reduction in 13.58 Full Time Equivalent (FTE) positions has been made thus far, including 5.14 FTEs who were reallocated to funding by non-property tax revenues and 4.58 FTEs from the Whistler Centre for Sustainability who are no longer municipal employees. The remaining 3.87 FTEs are positions that have simply been cut.

"We have a GIS position cut in Engineering (1.0 FTE), 1.2 FTEs in utilities, and 1.25 FTEs in transportation as well as a partial cut to a position in Planning," said Lisa Landry, general manager of economic viability for RMOW. "The 2010 Games office staffing has been cut as well, but that was not funded by taxpayers in the first place, so that staffing reduction does not result in a net savings to taxpayers."

Last week RMOW identified an additional $212,000 that could be saved, including $126,000 earmarked for contingency budgets and $30,000 for village maintenance costs. They have identified another $200,000 in annual cost savings since then.

"This is being accomplished by looking hard at how we provide services, determining ways to cut expenses or generate more revenue, and we will continue that work over the next few months until we accomplish our goal of limiting it to a four per cent tax increase" continued Landry.

A common question asked of municipal authorities is what income their position would generate in the private sector. It's a fair query, given that in 2009 Whistler's municipal salaries soaked up about 68.5 per cent of revenue from property taxes. In 2008 they absorbed 57.5 per cent and in 2007 55.8 per cent.

"We have about 250-350 people who work for us in a very wide range of positions and so while people might be able to find some examples where a wage scale might be higher here than it might be in a comparable position in the public sector, I can find other anecdotes of the reverse," said Whistler Mayor Ken Melamed, adding that keeping Whistler to specific standards often takes more than most private sector services can provide.

"It's not a fair comparison because you can't just look at wages. The service under the old model was not up to the standards of the original village so in order to maintain that consistency and quality of the experience for the visitors we had taken that over by our municipal staff. I don't think that means we're paying more, it means we're paying fair wages but we can be assured more of the quality of the look and feel around the village."

According to data compiled by the Canadian Federation of Independent Business, B.C. municipal workers earn on average 10.4 per cent more than their private sector counterparts in the same job. That number jumps to 34 per cent when benefits are factored in.

RMOW bases its wages and financial benefits on six Metro Vancouver municipalities - the District of West Vancouver; the District of North Vancouver; the City of North Vancouver and the City of Coquitlam. When wages go up in those communities so do Whistler's.

Those cities will be renegotiating their wages in 2011 and Melamed says that's when decisions will be made surrounding RMOW payouts, including the possibility of a wage freeze, a topic he says is always being batted around.

"Currently the policy the municipality has is to wait until the Lower Mainland union negotiations are complete and we generally have adopted that wage agreement and apply it across our contract with some slight modifications because remember, only a small portion of our staff are unionized and the rest are non-unionized but they have an employee handbook that is essentially a contract," he said.

"There has been a continued belief that wages at the municipality are not what they should be but I think that's anecdotal and there is really not much hard evidence of that fact.

"Pretty much every year we talk about this. What people are having a difficult time understanding is that you cannot freeze wages when you're in a contract so it sounds like something easy to do but when you ask the question 'Is it possible?' and the answer is 'no,' you quickly move on to other directions, you search for other options."

A second budget open house featuring the results of the Community Life Survey and a summary of the proposed budget will be held on Monday, Dec. 13 from 4 to 8 p.m. at Spruce Grove Fieldhouse.