Whitehorse residents who become riled at the thought of their municipal government continuing along its trajectory of incremental tax hikes may as well start practising their deep-breathing exercises now.
This coming Tuesday, Whitehorse city council is poised to pass its operating budget for the coming year, and it’s hard to imagine any outcome other than the spending plan being approved.
That means your average homeowner can expect to pay an additional $39 in taxes this year, for a total of $2,304. Your average business, meanwhile, would pay an additional $250, for a total of $14,830. This is the same 1.7 per cent increase budgeted last year. The city is planning a similar increase next year, too, followed by bump of 2.3 per cent for 2018.
These increases do little more than keep pace with inflation, and Whitehorse residents continue to pay taxes on par with comparable jurisdictions. But business leaders have a point when they note that a sluggish economy has required the private sector to make tough cuts - a reality that those within government are often insulated from. They’d like to see a tax freeze this year to help ease the pain felt by residents during these tough times. They’re unlikely to get it.
It’s hard to fault Mayor Dan Curtis for sticking with a course that he has long publicly defended. But it’s odd how little the public has heard on the matter until now from Samson Hartland and Dan Boyd, two city councillors elected on platforms of fiscal conservatism.
By now, the city’s shriller critics, whose thoughts tend to run a distinctly conspiratorial streak, may wonder whether these two have become absorbed, Borg-like, into the collective. But both simply insist they have been quietly putting downward pressure on spending initiatives during committee meetings, rather than creating a ruckus in front of reporters while council meetings are in session.
That’s probably pragmatic - after all, two votes by themselves are not enough to make a ripple in city policy. Still, it’s surprising that our current council has managed to avoid any vigorous public debate over how much money the city should spend.
The city’s capital budget quietly passed in December without any fuss. That’s despite the budget’s plans to plow ahead with building two spiffy new municipal buildings - an operations building at the top of Two Mill Hill, and a services building beside City Hall. Clocking in at $56 million to be spent over the next three years, this is the City of Whitehorse’s biggest-ever infrastructure project.
City officials insist these new buildings won’t be built through tax increases. But, as our columnist Keith Halliday noted in a column late last year, there is reason to doubt whether this is true.
While the city does hope to secure a good chunk of federal cash for this building spree, the reality, as Halliday notes, is that part of the work will be funded with the city’s reserve funds. These reserves have grown rapidly in recent years - in part due to tax increases.
In fact, the $2 million that the city socked away in savings for 2014 was even bigger than Whitehorse’s increase in tax revenue. That means that the city could have frozen taxes and still balanced the budget that year, if so much money were not being diverted towards savings for such things as future infrastructure projects.
The mayor and city officials insist that the new municipal buildings should be viewed as long-term investments that will ultimately save taxpayers money by consolidating more workers under the same roof and through reduced heating bills. They also note that this construction work will help employ Yukoners.
Maybe this is all true. But the public was never treated to a serious public discussion about cheaper options, in light of the deteriorating economy. Boyd notes the construction schedule has been slowed to avoid costs spiralling out of control, which is commendable enough, but a far cry from a complete rethink.
After all, the Yukon government was able to scale back its grand designs for the new F.H. Collins school to something more modest. Couldn’t the city have done something similar and made greater use of leasing downtown office space, of which there is currently a glut? This is a question we’ve never heard anyone on city council ask.
Samson and Boyd have picked a public fight against one expansionary plan by the city, to roll-out a curbside blue bin program this year at a cost of about $15 per month to residents. Unfortunately, the duo haven’t presented a workable alternative. They’d like to leave the Blue Bin Society to chug away with its voluntary program, ignoring the fact that Raven Recycling, which processes the recyclables with the help of government funds, warns that the status quo is untenable and would eventually push the non-profit into bankruptcy.
City managers contend that the proposed operations budget already has a variety of small cuts included within it. They’ve said no to a bunch of departmental requests, and have made some actual reductions on administration. Overall, the city’s operations budget has grown by $312,000, or less than half a percentage point, to $70.6 million.
City officials say that $600,000 would have to be hacked from existing services in order to freeze taxes this year. It seems quite unlikely that any councillor will propose any cuts of this magnitude next week. But at the very least, perhaps someone could ask how much money from this year’s tax increase will be stuffed into the reserve funds that will help pay for the city administration’s new headquarters.