Budget Process Improvements Ė Part I
This year staff made Councilís job relatively easy and they readily approved an operating budget with an increase of less than one percent. However, as some members of council pointed out, there is still a significant gap between taxes in Owen Sound and taxes in our nearest neighbours in Georgian Bluffs.† The owner of an average detached bungalow in Georgian Bluffs currently pays $1,806 in taxes while an owner of the same property in Owen Sound pays $4,210. This is a huge gap that is stifling Owen Soundís growth and encouraging residents to move across the city boundary where they can save $2,404 per year in taxes while still enjoying everything that Owen Sound has to offer. Therefore there is much more to do to reduce this disparity.
Changing the Budget Process
As shown in the graph above, if we were to have successive annual tax reductions of 2%, and Georgian Bluffs were to increase their taxes on average by 2.5%, it would take 20 years to completely close the gap. So in order to reduce the gap over a reasonable time period, it will also require one-time reductions in expenses, in addition to annual tax reductions.†
There are three areas that should be seriously considered for significant expense reductions. They are: the Art Gallery, the Transit System and the Workforce.† I will examine each of these for their potential in closing the tax gap.
the Art Gallery
Last fall I sat down with the Director of Gallery to discuss the need to improve the Galleryís profile in the community.† I suggested that the Gallery needed to reach out, beyond the art community, by rolling out more community-based art education programs. I also suggested that regular presentations at our schools and college would vastly improve both community engagement and the value of the Gallery in the eyes of taxpayers. I also identified business graduate schools as a cost-free source of expertise to develop a new business plan and a revised community-focused marketing strategy.
I truly believe that implementing these suggestions could greatly improve the value of the Gallery in the eyes of the taxpayer. However, in the absence of a successful community engagement program, along with an education program that is highly valued by the community, the return on our annual $475,000 expenditure is just not justified.
Examining the Transit
In regard to public transit, in 2015 we paid $744,000 to provide transit services to a small portion of the population. Since then the number of people using transit has declined while the budget has nearly doubled.† Transit now costs us over $1.3 million per year to serve fewer people than we did in 2015.†
This service needs to either be significantly changed to reduce its burden on taxpayers, as I suggested in my article, How to Fix Our Broken Transit System, or it should be shuttered and current regular users added to the mobility transit service.† By doing, so regular users of the system, based on the historical purchase of transit passes, would benefit from improved service. However there would be a one-time cost for cancelling the current contract. In addition the cost of the mobility transit system would be significantly increased. Itís unclear what portion of the cost is associated with mobility transit. Assuming itís in the order of 20% that would leave a potential annual savings of about $800,000 per year if the regular service was cancelled after the one-time contract cancellation cost.
In Part II
we will examine the potential for the workforce as a source of savings. I will
also identify exactly what the problem is when it comes to workforce size at the
city and provide clear suggestions for Council on how they can deal with this
problem this year, as opposed to putting it off as many previous Councils have
in the past.
Overstaffing at City Hall
|is costing taxpayers $5.8 million per year relative to Strathroy|
|(that represents 17.6% of this year's tax levy)|
Comparison Not Including Protective Services
|Salaries & Benefits||Number Earning > $100,000||Number of Managers|