|
Mayor’s Remarks
Budget 2010-2011 & Tax Rate
Town of New Glasgow Council Meeting
July 19, 2010
Budget
The Town of New Glasgow is increasing its residential tax rate from $1.77 per $100 assessment to $1.80 per $100 assessment for the 2010-2011 fiscal year. This is a 1.7% increase and translates into a $30 per year increase for the average home in New Glasgow. Last year we were able to hold the tax rate at $1.77 but had at that time informed our citizens that the previous rate would not be sustainable in the future. After careful deliberation and analysis, Council deemed it necessary to increase the rate slightly but have also decreased our budget expenditures and are continuing to source ways for all departments within the Town’s operations to run more effectively and efficiently, while still maintaining strong municipal services. I believe, as do our Council and our citizens, that it is the strength of these services, which impacts New Glasgow’s quality of life such that we provide a community in which families may prosper and thrive as well as an environment that attracts newcomers, visitors and investors to our Town.
Even with this modest increase in our residential tax, this rate is still lower than the rate of 2006-07 which was at $1.82. The provincial cap on residential assessments continues to impact municipal revenues. For the Town of New Glasgow, this cap has resulted in reduced revenue of $788,139 for 2010-2011. A reduction in equalization payments from the Province for 2010-2011 has also impacted revenues. In addition to these decreased revenues, are the very significant costs of the repayment of the accumulated deficit in the PANS pension, which is not administered by the Town, as well as a potential shortfall in the Town of New Glasgow pension plan.
The modest increase in the residential tax rate came as the result of a thorough budget analysis and diligent review of all Town operations. Council has taken a strong business approach and is committed to continuous improvements to our best practices. Today’s global economy dictates we must all be willing to do business differently. We recognize we have been, and will continue to be, impacted by the state of the national and international economies and that we must adjust our governance and operations accordingly. We are firmly committed to providing a safe and secure community that is in a position to move forward. In order to provide an environment where our Town can move forward, our infrastructure must be well maintained and our protective services well equipped and well trained.
An example of being innovative and reducing costs within our operations budget is that we are centralizing purchases to effectively utilize volume pricing. Another example would be the on-going identification of both immediate and long-term solutions to reduce workers compensation costs and to stabilize costs of health, wellness and safety through improved health and safety policies and programs for our employees.
The commercial tax rate will increase from $4.02 to $4.15 per $100 assessment. The rate is adjusted to reflect continued decline in revenues resulting from the loss of the Business Occupancy Tax from a significant amount of businesses and the process to create one commercial tax. The Business Occupancy Assessment Tax was considered by many to be outdated and inefficient and the phase out schedule began in 2005 and will conclude in 2013. This phase out is establishing a Commercial Tax, whereby a single transparent tax and tax structure is the basis for generating the commercial tax revenue necessary to provide municipal services. Business Occupancy Assessment Tax creates the perception of double property tax on business and hinders attempts to retain and attract businesses to Nova Scotia. The phase out has been implemented to simplify the tax structure and is not intended for the purpose of decreasing taxes.
New Glasgow continues to see growth. The ongoing infrastructure and development projects taking place in our Town are reflective of progress. Council is committed to working with developers and investors to provide a climate for business as well as a level of service and quality of infrastructure that stimulate economic growth. We currently have two very significant infrastructure projects underway with the MacLean Street and East River Road initiatives and are working together, three orders of government, to invest in and improve our community through these important projects. These projects will remove the storm water from our sewer system and reduce operational costs related to the East River Environmental Control Centre (ERECC).
During the past year we have seen the completion of Phase 1 our Downtown Revitalization project that has changed the streetscapes of our Downtown core. Investments in the façade improvement program have given new vitality to the Downtown and demonstrated a significant commitment by the private sector. Several new businesses have moved into the Downtown and existing businesses continue to invest and enhance their operations. We have welcomed the New Glasgow Farmers Market to the Downtown in a wonderful new facility and we have seen major commercial activity and developments such as the enhancements to Aberdeen Business Centre, the construction of a new Lawton’s, renovations to Chediacs, several new restaurants and much more. There have also been major residential developments in both the east and west sides of our Town during the past year. Overall construction value in the Town has increased over the previous year with a value of $12,079,100 in total building permits as of March 31, 2010, compared to $11,560,528 in the previous year. This is a tremendous accomplishment given the continuous pattern of growth and development over the past several years.
The Town’s sewer rate will increase from $3.50 per 1000 gallons to $3.61 per 1000 gallons. This increase will mean a payment of $5.00 more annually for the average household. This increase is once again needed to continue investment in our infrastructure, such that we are in a position to maintain our level of service as well as to facilitate new growth and development. The extreme weather conditions of recent years placed strains on our sewer and storm water separation systems such that we need to upgrade and invest to prepare for the changes in weather patterns that we are now experiencing on a regular basis. Should we have decided not to invest in our infrastructure at this time, the costs would be far greater and far more unmanageable in the long term.
For the fiscal year 2010-2011, the Town of New Glasgow will operate on a budget of $15,547,787. For the first time in many years we have decreased our budget and this reduction, in these times of escalating costs, clearly demonstrates that we are firmly committed to prudent fiscal management while maintaining a strong standard of services.
The majority of budget demands can be attributed to the following factors:
• the repayment of the accumulated $1,100,000 PANS pension shortfall
• significant increases in costs for products and services, including fuel, which has affected transportation, paving and asphalt costs.
• The payment for the acquisition of Glasgow Square Theatre due to our loan guarantee to the Riverfront Development Society. The Town has taken ownership of this infrastructure as Council places great value on this community asset along the Riverfront, which is among our Town’s and region’s most important community gathering places.
• capital investment requirements and improvements such as the MacLean and East River Road infrastructure improvements, which are improving our water and storm water infrastructure and our environmental stewardship
• increase in electricity costs and maintenance of Town owned facilities while also implementing two eco-chill projects for the Stadium and the Town Hall, which significantly reduces energy consumption and increases efficiency
• increases in levies from outside agencies ( i.e. Pictou County Shared Services Authority, East River Environmental Control Centre, Mount William Landfill, New Glasgow Library, Regional Emergency Measures and others)
• recent ratification of a CUPE contract with a 3% wage increase for 2010-2011
Our existing regional services are currently based on a uniform tax assessment funding formula. New Glasgow Town Council supports a user pay formula as we do not consider uniform tax assessment a fair funding formula for these essential services. Such a formula results in New Glasgow subsidizing other users’ costs. A more equitable user pay system will allow us to achieve more stability in our operational costs and budgeting.
I would also like to take this opportunity to emphasize the Town of New Glasgow’s commitment to regional prosperity through our support for projects such as the Wellness Centre, which has a sustainable financial model which will not impact our general municipal tax rate; our commitment and financial support for regional facilities such as the indoor soccer complex and the new track and field facility as well as regional economic development and tourism. And of course our unwavering endorsement and financial commitment for expansions to the emergency and pharmacy services of the Pictou County Health Authority.
Town Council has made some very tough decisions and this budget proved to be very challenging. There will continue to be immense challenges in the days and years ahead and we will work hard to provide an environment for growth while keeping service levels strong and our tax rates fair and reasonable.
I extend my sincere appreciation to all members of Council for their time and commitment to the stewardship of our Town and to our CAO Lisa MacDonald for her operational leadership in these challenging times. My appreciation goes out to all Department Heads for providing hard work, financial accountability, and transparency and for managing budgets that will support progress and development for the Town in a fiscally responsible manner.
|
