After a week of careful deliberations and debate, Prince Edward County Council arrived to the end the 2020 budget deliberations. Tasked with the objective to find cost savings where possible, council brought forth a modest budget that focuses heavily on roads and other forms of infrastructure. The deliberations, which concluded last Friday, will result in an increase of $15.30 for $100,000 of assessment.
“With the 2020 budget, we aimed to find operational savings without impacting service delivery,” said Mayor Steve Ferguson. “We are in a position to make strategic investments in our capital reserves while we continue to offer high quality service to residents and businesses. We look forward to continuing the conversation this spring on how best to address our roads needs County-wide and find further efficiencies by examining the way we deliver services.”
Council approved an overall 2020 tax-supported operating budget of $59.0 million and a capital budget of $11.5 million. $40.3 million will be raised in property taxes to fund the portion of the operating budget not covered by other revenue sources such as grants and fees.
The budget includes a substantial investment in road infrastructure with a new capital roads levy of $1.53 million and a continued levy of $372, 001 for the Prince Edward County Memorial Hospital redevelopment.
The 2020 net operating budget is $1.8 million more than in 2019 and sits at a 4.7 per cent increase.
Among the issues brought up around the horseshoe, with potential to further increase the levy, were the somewhat related topics of flood mitigation and climate emergency.
“There was a lot of talk about whether or not council wants to take on additional areas that may increase the levy,” explained CAO Marcia Wallace during deliberations.
Wallace noted that, at this time, staff do not recommend a climate emergency reserve be added to the 2020 budget.
“I think its something we should work towards in future budgets, but it may be a premature hit on the tax levy at this time. Assuming council does not decide to add such a reserve, I think we should reflect the minimal real cost we expect to incur due to a 2020 flood, should it occur,” said Wallace.
According to a recent press release from the County, notable investments supported by the 2020 budget include:
- $1.1 million for major underground infrastructure renewal and road construction on Elk Street in Picton, with funding from the Ontario Community Infrastructure Fund. Design work for the project will take place in 2020 with construction lated for 2021.
- $16.6 million for underground water and sanitary work in Wellington.
- $530, 000 for two new snowplows to support winter maintenance
- $1.1 million for the County’s road surface treatment program.
Water and wastewater rates will not increase through the 2020 budget with urging from the Director of Finance Amanda Carter to embark on a water/wastewater study as soon as possible. Carter asserts the County is losing revenue due to a steady decline in water consumption throughout the county.
“This is one reason we’ve asked to have a water/wastewater study in this budget. Three things impact that part,” said Carter. “It (water consumption) has declined each year for the past two years, which deviates from the plan. We’re having a revenue issue. We are not taking on the amount of debt the plan had indicated at the same rate, but had we taken that on it would be a bleaker picture. The rates need to be studied. The timing of capital coming off that plan needs to be studied.”
According to Carter, revenues compared to plan are down $400,000 which is indicative of declining water consumption.
Wallace further explained that, unlike taxes which change each year, water rates are set on a five year cycle. With the end of the current rate study in sight, the need for a new study is looming large.
With an eye to necessary improvements at the Wellington Water Plant, Councillor Brad Nieman protested, stating some cost for infrastructure upgrades should be borne by developers, who through new developments necessitate upgraded infrastructure.
“Improvements for water plants should not be paid for by the rate payers,” said Nieman. “In other municipalities, they do have mechanisms where, if the developer is doing it and the municipality has to upgrade because of that, they require the developer to fund some of that.”
Wallace, in replying to Nieman, asserted that growth should pay for growth, and acknowledged the County’s method to ensure such tandem progress has not been working.
“What we’ve found over the years is the method by which we’re trying to ensure the infrastructure costs are proportionate to new growth is not working. That’s what we’re looking at going forward-that there’s better alignment,” said Wallace, adding that if the municipality doesn’t have enough to pay for the growth, there is a financial risk.
Councillor Jamie Forrester posited that the decline could be, in part, due to the rise in short term accommodations (STAs).
“If we started out five years ago with 100 STAs and, as STAs go up, -snow birds have always been here to an extent-but we know there’s been a rise in STAs, especially in Wellington,” stated Forrester. “If that would be the case, should we be looking at some sort of offset to the funds we put for STA regulations going back into water/wastewater?”
Wallace, explaining that the county is a bit of “a leader with the whole STA question in general”, stated the issue remains to be explored, with both a water/wastewater rate study and a study pertaining to STAs forthcoming.
After some division amongst council with regards to how much money should be allotted to the roads levy, council voted for an increase of four per cent. The vote was recorded at seven to five.
Councillor Mike Harper supported this increase as a way to improve infrastructure, thereby attracting investors. Harper insisted the role of governance is to make the county attractive, whether that be for developers or future residents.
“I find myself wanting to go a little beyond the cost of living increase, because to position ourselves for success, we need to build reserves,” said Harper.
Though the 2020 budget deliberations focused mainly on tangible assets, Councillor Kate MacNaughton stressed the need to focus on more human assets in the future.
“I’m hoping next year we can see opportunities realized further and not just invest in our tangible, linear assets. Not just pipes, concrete and asphalt, but also the people in our community who do need some looking after,” stressed MacNaughton. “I don’t see us having invested in them as much as we could have this time around…they’re our most important assets.”
Apart from ushering in a new budget, last week’s deliberations were also the first for newly minted CAO Marcia Wallace.
Mayor Ferguson described Wallace’s approach to deliberations as being particularly well organized, especially considering she’s “hit the ground running” since coming to work for the County mid-December.
From mid-December until last week, Ferguson stated, the new CAO has been working with staff to understand and refine the municipal budget process, and then refine the presentations based on council’s directives, particularly looking for efficiencies.
“What we saw when we got to budget presentations was they were much more structured, with the material being very well organized,” Ferguson told the Gazette. “I give Marcia (Wallace) all the credit in the world for getting up to speed in a very short period of time and and to staff’s involvement with putting together clear, concise presentations for us to consider.”