Budget Committee, Feb. 10, 2021
Meeting recap (the important stuff):
In the ongoing budget season negotiations, councillors received three presentations today: Fiscal Services; Finance, Asset Management and ICT; and Corporate and Customer Services. As a reminder here’s how the budget process works.
But before the presentations from the city’s business units, they heard a presentation from the Halifax Chamber of Commerce. The chamber’s President and CEO Patrick Sullivan asked council to not raise commercial taxes. Since the HRM is legally required to have a balanced budget and also needs to maintain its buildings and infrastructure, his request, should it be implemented, would result in either higher individual property taxes, a reduction in HRM services, or a spike in both individual and commercial property taxes in future years. The city’s CFO Jane Fraser has explained in great detail why the proposed tax increase is the best option.
Councillor Lindell Smith pressed Sullivan on how the city should make up the shortfall if they accepted his suggestion and Sullivan said staff could come up with something. This is unlikely. As Fraser has pointed out previously, the budget being restructured in the summer to deal with COVID means the city is already running very lean. In practice, Sullivan was asking taxpayers to do without city services or pay more in taxes to subsidize businesses in the HRM. The councillors who spoke politely rebuked his presentation with pointed questions.
Councillor Outhit put forward a motion for an affordable housing tax rebate to be put on the Budget Adjustment List (a.k.a. the parking lot, the nitty-gritty stuff they’ll be debating after all the business unit presentations). Councillor Mason asked for more information about sidewalk snow clearing machines and, if required, will be trying to add more to the capital budget when that comes up in a couple of weeks.
Who said what (paraphrased):
Russell: We have a public speaker, Patrick Sullivan from the Halifax Chamber of Commerce
Sullivan: I’m the President and CEO of the Halifax Chamber of Commerce. 2020 was a challenging time for our community, due to the pandemic. Our budget submission to you has suggestions on what you can do to help mitigate the impact of COVID on the business community. Our budget submission has suggestions to help mitigate the impact of COVID on the business community. The road to recovery isn’t straightforward, but we hope the city will take this into account. We recommend freezing the commercial tax rate, although $817 dollars doesn’t sound like much (it isn’t). Switch to a service-based model of taxation (they are) and ask for more tax powers from the province (ha!). Accelerate development timelines for increased housing and affordable housing, publicize density bonusing (they are), and ask for more power from the province (ha!). Increase core density. Make sure downtown developments don’t impact downtown businesses. Continue to review bylaws and reduce regulation, and keep policies that help businesses. Provide incentives to increase ridership on transit. Ensure wage increases do not increase spending and taxation levels. Provide stakeholder engagement on pension funding reform to ensure fiscal responsibility because the municipality has one of the best pension plans in the country (translated: you can keep taxes low by reducing employee benefits).
Smith: I look forward to seeing the detailed version of what you just mentioned, freezing the commercial rates, how would you suggest dealing with the shortfall?
Sullivan: Staff could reduce spending, there are some businesses that have had some success, but the current policies don’t allow for selective tax increases, so staff could come up with something.
Austin: HCC would support municipal efforts to get more authority, what does the chamber do to help with the lobbying to get us more authority?
Sullivan: We’d be pleased to coordinate our efforts. There are more MLAs than councillors, so we’d encourage them to advocate on your behalf.
Cuttell: The 1.9 per cent tax increase, Shawn you’re shaking your head, is actually a decrease in commercial tax (due to math that makes sense I promise).
Sullivan: Can I comment? I agree the commercial tax rate is a decline, however, but it’s already higher than the residential tax rate, so it’s an increase.
Cleary: I was shaking my head because you said it was a 1.9 to the mill rate, but it’s not, it’s for the average bill. I took a bit of pillorying for suggesting businesses shouldn’t bear the large increase in tax bills. The residential and commercial ratio has been changing, and the commercial rate has been declining. It would be great publicizing the benefits of taxation, when we spend money on the library our citizens become more educated and literate which means businesses can save on training. Spending on the bus means businesses can pay minimum wage and people can still afford to get to work, which is a huge benefit. Police and fire protect businesses from break-ins (debatable, I’d suggest the police investigate break-ins that happen, not prevent them from happening). Fixing our potholes means fleets don’t get wrecked. Sullivan, do you think your members are unaware of these benefits? Do you not educate them on these benefits?
Sullivan: Thank you for the question! Our businesses are aware of the value they receive for their tax dollars. However many of the services you mentioned are supported by everyone’s tax dollars. Sometimes businesses have expenses that are above and beyond even though taxes pay for things, for example even though they pay taxes for garbage pickup, they also need to pay for private pickup.
Mason: Given what Cuttell said, we’ve achieved the Halifax Chamber of Commerce’s request for lowering taxes! The commercial tax rate is lower per square foot than most other municipalities. Vancouver is $9 dollars, Halifax is $6. I’d love to hear the HCC say we need to be competitive, not high or low, but competitive. Have you had that discussion at HCC? Our industrial rate is a dollar higher than the average. Focusing on the rate or the bill isn’t looking at the core issue is competitiveness.
Sullivan: We’re getting into fine details. It depends on what you look at. By the report I’m looking at, we have the highest rate! We believe that a commercial tax rate higher than a residential tax rate is penalizing businesses.
Savage: Cuttell mentioned the calls with the HCC, and I think they’ve increased the success the province has had dealing with COVID. We have to take on poverty and homelessness. Our growth hasn’t been equitable.
Sullivan: Can I respond to the mayor? I don’t want to take everyone’s time. We’ve had a lot of talk about the commercial tax rate, and we’ve made recommendations that will support all citizens of Halifax (citation needed).
Russell: Onto Fiscal Services, welcome Jane Fraser.
Fraser: What is fiscal services?
Fraser: And here’s our budget:
Lovelace: *Reads the motion for agenda item 5 as written* I have a question about area rates, there’s a trend where they’re dropping out because they’re contingent on volunteers. And when the volunteers disappear, the area rates do, but the problems in the area don’t go away. (Area rates are tax rates that are applied to specific geographic areas that use specific public services outside the normal scope offered by HRM. You can find a full list of area rates in the HRM here.)
Fraser: Area rates are bare bones and specific to a desire a community has. We’ve been trying to make area rates easier to deal with. There used to be well over 200 area rates before amalgamation, if a community wanted a fire truck it’d have a different area rate. More affluent communities can raise an area rate, which makes things unequal. So we have done a lot of work there to make sure it’s targeted to needs.
Fisher: The benefit of area rates is that communities can get localized things faster.
Lovelace: When we see the demographic changes in communities, is there an opportunity to change area rates?
Fisher: There’s a process.
M/S/C – Vote – Unanimous – Aye
Fraser: Now I’m presenting Finance, Asset Management and ICT. Here’s my team:
Fraser: Here’s the money and assets we manage:
Fraser: One thing you may not know is that we process all of the coins from transit and parking, it’s $8.3 million. We had successes in COVID, our procurement people were able to get and distribute PPE, we switched to virtual regional council. We established a cybersecurity framework, we had a 300 per cent increase in budget participation. We try and make sure we have a sufficient supply of industrial lands in our inventory. We’re also redesigning our Community Grants programs to make sure it’s clearer and easier for groups to apply for and receive grants. We’re looking at changes to commercial taxation, it’s ongoing. We’re coming back to you with a 20-year community vision in the near future. We’re going to be implementing a digital strategy to inform how the city uses technology. We also are working on our diversity and inclusion framework. Here’s the budget:
Smith: *Reads the motion for agenda item 6 as written* With procurement, do you believe that we need an extra person with expertise in social procurement? Or do we have someone like that in-house?
Fraser: We have two things going on in procurement. First, we are changing from business unit to portfolio-based. We’re also developing a procurement process with key performance indicators, for social procurement. We have a bit of a gap between now, prior to implementation, and on the other side of this when it comes into force. There likely will be a need for more staff to look at social procurement, but I don’t know what the gap looks like or what the knowledge we don’t have is.
Smith: We got a presentation from the construction industry that this would create hardship especially when it comes to administration. Should there be something in here to help with the admin costs, should there be issues down the road? Should we put in a little reserve for this?
Fraser: I would rather come back to regional council with a full ask if we need it, I think we’re okay right now though. I think it’s too soon right now, but if I need it, I’ll ask for it.
Smith: What is community vision engagement?
Fraser: That’s long term planning for what the HRM will look like 20 years from now. With all the growth we’ve had it’s been a bit ad hoc, it’s better to at least have a plan for it.
Deagle-Gammon: I love these presentations (me too, me too). I have been on the other side of the table with the working group on social procurement, Jane Pryor does great work. In redesigning the community grants, the easier and more accessible we can make them, the better. If we can have the same kind of clarity on area rates that would be better, so they can be accountable.
Fraser: The over we’re recommending, is due to the need to support non-profit housing. We have a mishmash of programs, this is an effort to help assist within our legislative framework.
Outhit: The tax rebate for affordable housing would need to go into the parking lot?
Outhit: Can the community planning vision be pushed out a year without the world ending?
Fraser: The visioning exercise was on the books for 2021, and we delayed it to save the $75,000. We can do whatever is directed, but it’s an integral part of a lot of other planning.
Outhit: I’ll move the tax rebate for affordable housing to the parking lot.
M/S/C – Vote – Unanimous – Aye
Russell: That’s in the parking lot and we’re back on the main motion, no other speakers. One of the key performance indicators says the IT department has 97 per cent approval rating, so good job on that.
M/S/C – Vote – Unanimous – Aye
Russell: On to Corporate and Customer Services.
Jerry Blackwood: Here’s what we do, and who does it:
Blackwood: Here are some fast facts about our department:
Blackwood: We completed construction of the St. Andrews Centre, we improved Beazley Field. St. Margarets Bay arena will be getting the city’s first electric zamboni. We have a lot of stuff coming to the capital project meetings. We have plans to meet provincial access 2030 targets, and we’ll be doing some of that work this year. We also are planning on meeting HalifACT 2050 targets. We’re looking at developing a project to improve our community engagement strategy. We’d like to bring on three new people. (Sorry folks, normally I’m good with presentations like this, but I am struggling with this one. This paraphrasing is incomplete due to my… uh… totally paying 100 per cent attention to this riveting presentation.) Here’s our budget:
Blackwood: And that’s my presentation.
Lovelace: *Reads the motion for agenda item 7 as written* There’s a lot of information packed in that motion. Yay to the first electric zamboni! Of the 411,000 contacts in the contact centre, how many of those calls are provincial? Most of the calls I’ve gotten in the past 48 hours have been about provincial issues.
Blackwood: We get calls about provincial stuff, and we have processes and protocols in place to transfer them.
Staff: We don’t count provincial calls, 28 per cent are transit. But for calls we transfer, we don’t actually track them.
Lovelace: Should we be asking the province to do more to define their jurisdiction. I think we could do that better if we had data supporting it.
Mason: One tiny thing, which I know is more of a capital ask. Fleet sidewalk snow removal. The various sidewalk removal trucks are getting older and breaking down more. We only have 13 machines to remove sidewalk snow. What are the plans for maintenance? Referral? Should we have a spare on both sides of the harbour?
Blackwood: Our fleet is getting older. Over the last two years, we bought five new machines for our sidewalk fleet. They’re important gear, but they’re not always deployed and used. When we get the new depot built we’ll be able to store ‘em under a roof.
Mason: Could we get a memo about the sidewalk fleet before we get to capital? I want to know if I need a motion for capital. We’re not getting the work done so we need to address it.
Stoddard: Preventative maintenance used to be done by the operators, and is now done by the mechanics. Operators could fix little things and be on their way, but now have to go to the shop. Why did that change happen?
Blackwood: Our preventive maintenance program has always been with the mechanics, but operators have a role in it.
Stoddard: How long is the training for 311 operators.
Blackwood: Six weeks.
Staff: Six to eight weeks. They take calls for business units they’ve been trained on. They keep their trainer for another two to three months.
Stoddard: How do you monitor COVID procedures on the vehicles, especially those shared by more than one person?
Blackwood: We have COVID protocols, they have cleaning supplies in the vehicles. PPE is available to anyone using the vehicles. People need to wipe them down when they leave the vehicles. In cases with COVID exposures, we’ve sent them out for deep cleaning and disinfecting.
Mancini: Corporate communications, we don’t do a very good job of patting ourselves on the back when we make good decisions. Yesterday we did good work on College Street, but people in the media don’t pick out the good news stories. I think we need to do a better job communicating.
Blackwood: We’re looking at building our capacity to do this.
Mancini: It’s not just good news stories, but explaining how the government works too.
Staff: When we switch to the new taxation system, it’s not going to be a silver bullet, but it will make communication much clearer.
Mancini: Even highlighting some of the great staff that we have! We should be doing that too. Councillor Mason brought up what I wanted around snow removal. For corporate fleet for fire, do you just follow the fire chief’s lead on that? Or do you do some stuff too?
Blackwood: We listen to the departments who are asking for things, and we do collaboration.
Outhit: I agree that we should work on comms. We were talking about having something in councillor support that summarizes what we do, maybe a monthly brief of what we’ve done and why. Is this happening? Or are we waiting for something?
Blackwood: We’re in the process of recruiting for this role.
Staff: We’re trying to make sure it deals with fact, and not political opinion. We need a structure in place to make sure this happens.
Russell: Outhit had mentioned Twitter, Facebook and the website, but we also use HFX Alert, is the consideration to use that in an expanded format? (I had no idea this existed.)
Staff: It’s an effective system, people sign up for it and want this information. We’ve had conversations about what are the opportunities for this tool, but we want to avoid the boy who cried wolf factor.
Russell: The Halifax Recycles app is amazing, that could be an avenue, an app. IVR responses, do you analyze the calls and try and figure out how many more calls could be dealt with, with an automated response?
Blackwood: We look at our calls, it’s something we always actively look at.
Staff: We change the IVR constantly to better reflect the changing conditions.
Russell: The quality and accuracy of the calls received by 311, you have a target of 80 per cent, which you’ve met consistently. Are you planning on increasing the 80 per cent?
Blackwood: We’re always looking at it and trying to do better around it. 80 per cent is an industry standard. We can look at improving it.
M/S/C – Vote – Deagle-Gammon, Hendsbee, Kent, Purdy, Austin, Mancini, Mason, Smith, Cleary, Morse, Cuttell, Stoddard, Lovelace, Blackburn, Outhit, Russell – Aye – Savage – Abstain
Councillor Paul Russell, Chair (District 15)
Deputy Mayor Tim Outhit (District 16)
Councillor Kathy Deagle-Gammon (District 1)
Councillor David Hendsbee (District 2)
Councillor Becky Kent (District 3)
Councillor Trish Purdy (District 4)
Councillor Sam Austin (District 5)
Councillor Tony Mancini (District 6)
Councillor Waye Mason (District 7)
Councillor Lindell Smith (District 8)
Councillor Shawn Cleary (District 9)
Councillor Kathryn Morse (District 10)
Councillor Patty Cuttell (District 11)
Councillor Iona Stoddard (District 12)
Councillor Pam Lovelace (District 13)
Councillor Lisa Blackburn (District 14)
N/A – COVID
Previous meeting minutes and current agenda:
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