Budget 2019 – Highlights and Conclusion

After months of analyzing, asking questions, and debating, City Council has wrapped up debate on the 2019 – 2022 Operating and Capital Budget. This budget will shape the way Edmonton grows over the next four years. Over 150 Edmontonians came out to speak at the Public Hearing on the budget. We heard about the need to maintain services/infrastructure and address the basic needs of new communities all while keeping tax increases to a minimum. Council had the challenge of finding balance between community investment and fiscal savings. The final outcome of the budget will mean a 2.6% increase each year from 2019 to 2022. Although I believe more savings could have been realized during budget deliberations, I will elaborate on that later in this post, I am pleased that the tax increase will be lower than the current inflation rate of approximately 3%. Also, each of the increases from 2019 to 2022 are the lowest increases in more than a decade.

 

 

That 2.6% increase is made up of the following:

 

  • 0.6% goes to the Valley Line LRT construction.
  • 0.3% is for the Back Alley Renewal Program.
  • 1.2% will cover the increase in funding for Edmonton Police Service.
  • 0.5% addresses the cost of growth and inflation for all existing city services.

 

If City Council was to fund all services and infrastructure requested, it would have been a larger increase. In order to maintain a modest increase, we had to make difficult decisions on what is needed now versus what can wait for the future. The budget debates proved to be a difficult prioritization process, where there are more worthy investments then there is capital to fund them.

In my latest survey about the Budget, I was not surprised to hear most respondents explain that they want either no tax increase or a modest tax increase of no more than 3%. During the 2017 campaign, I committed to striving to keep the 2019 tax increase at or below inflation and completed a thorough review of the proposed operating and capital budgets to ensure the City is investing in the most efficient and effective way possible. This is the main reason I put forward a motion back in September to examine what programs and services could be changed, reduced, or removed.

 

The motion asked our Administration to prepare a list of what cuts would look like at 1%, 2%, 3%, and 4%. This list was very informative and a number of the proposed reductions were approved. The reductions totalled approximately $65 million of savings over four years. The savings were realized from items like reducing the amount we set aside for emergent items and a number of workforce strategies (ex: implementing flexible staff scheduling to reduce overtime, reducing the need for staff through implementation of new technology, etc.)

 

As our city continues to grow, there is still a need to invest in new programs, services, and amenities. The items below are proposals approved in the budget that I felt were important to highlight as they account for a larger part of our increase.

 

  1. Lewis Farms Recreation Centre and Library

 

This has been one of the most requested items from residents of Ward 1 as we are not currently meeting meeting our basic commitment for recreation services west of the Henday. The eplGO site at West Henday was always meant to be a temporary branch and the new library will be able to support the huge demand for programs and services. The motion to fund the construction of the Lewis Farms Recreation Centre and Library was amended to set aside funding for this project and to have a report come back in November 2019 with the results of a value engineering exercise. This exercise will allow us to tweak the design if there are areas that can help drive costs down. Considering the limited funds we have, that’s a prudent decision.

 

So now you might be asking, “Does this mean it will absolutely get built?” The answer is no. If the economy were to get significantly worse or if the price of the project came back even higher than the amount currently set aside, Council could decide not to proceed with construction. But I’m feeling quite optimistic that the project will receive final approval next year. While the ideal situation would have been to approve the entire budget without a need to report back, that was not the realistic way forward. This gives us that final check-in point on what is going to be a significant project.

 

Setting aside the funding for this project is a big deal. It sends a clear message that this project is a priority and even though we are going to review the total costs, we believe in it enough to set aside the borrowing room. It’s also important to note that this motion does not impact the construction schedule. The plan is to start construction in mid-2020 so having this report come back in November 2019 does not delay that.I would not support any changes to the design that could impact that construction timeline.

 

Lewis Farms Recreation Centre and Library Design

 

  1. Edmonton Police Service (EPS)

 

The recommended budget for EPS was a little over $87 million or a 25.8% increase over four years. I initially proposed a motion to provide EPS with an approximately $35 million increase over 4 years instead. That would have provided a 4% increase in 2019, followed by a 2% increase in each of the next three years. That still would have made it one of the most significant increase of our other branches and departments. As the debate proceeded, I realized that the motion I put forward was not going to pass and adjusted the motion to provide a $63 million increase. That motion was unfortunately defeated.

 

This is always one of the more critical items in the budget since the EPS budget is the largest of any department in the City of Edmonton. The budget survey results show public safety is a top priority for the city. That being said, that doesn’t mean that we should simply agree to any request for a budget increase. Looking at other metrics, we have actually seen an overall decrease on the crime severity index. Calls per 1,000 people are also lower than our previous peak. Therefore I felt that a smaller increase to the policing budget was reasonable and could be used to both decrease our property taxes while also funding other proactive measures that will work to prevent crime from occurring in the first place. The policing budget was increased by $70 million instead of the original $87 million but I think there was room for more efficiency. Being that policing continues to be our largest budget item, this should be closely monitored over the next few years to ensure it doesn’t continue to grow at an unrealistic pace.

 

  1. Coronation Recreation Centre

 

This recreation centre neighbouring Ward 1 will have a significant impact on many of the northern Ward 1 communities such as High Park, Mayfield, Canora, Britannia Youngstown. This recreation centre has been undergoing design and public engagement for many years and funding for the remaining $16 million has been approved so construction can begin. This recreation centre will include amenities such as a climbing wall, outdoor rec room, velodrome, and tennis courts.

 

Coronation Recreation Centre Design

 

  1. Back Alley Renewal/Road Widening

 

Back alley renewal and road widening is a priority for Ward 1, as there are several improvements that can be made which would improve the ability to travel within the ward. Of the 1,175 kms of back alley roads here in Edmonton, two-thirds are listed in poor or very poor condition. I would suggest it’s the most common complaint our office receives and yet until recently we did not have many solutions to properly address the problem. It was clear we needed a program, similar to the Neighbourhood Renewal Program, that would address the aging infrastructure and preserve the lifespan of that investment. The desire to see a proper alley renewal program is what sparked an inquiry I brought forward in 2014. You can read more about the history of this in previous blog posts I’ve written throughout my time here. We formalized the funding structure for the program during this budget and I’m thrilled to see strong support for this. Alleys are an important part of our communities and therefore it is crucial that the city properly maintains them.

 

With regards to road widening, in the initial recommended budget there were no dollars set aside for the detailed planning work for the widening of 215th Street or Webber Greens Drive. Originally I put forward a motion during the budget deliberations to redirect some recommended work to fund the next stage in design work for those roads. Even though this was simply swapping projects instead of requesting new funding, there were concerns raised around if this could be considered jumping the queue. While I do not believe the proposal I put forward was unreasonable since it was swapping out different projects within Ward 1, I decided to put forward a motion requesting a review of how we prioritize road widening work. In particular, I asked how we consider the feedback of the local residents and the Ward Councillor. Knowing that this is a major priority for efficient movement of people in the West End, I’d like to ensure that need can be reflected in the prioritization process. A report on this will be released early in 2019 and I will work to push for the next phase of work on 215th Street including the intersection of Stony Plain Road and 215th Street which can back up significantly during rush hour.

 

  1. Terwillegar Drive Expressway Conversation

 

The Terwillegar Drive expressway conversion was approved. Terwillegar Drive has been over capacity for many years and this conversation will help to move traffic more efficiently for a part of the city that has seen significant residential growth. This 0.35% increase needed to fund the $112 million project will occur over a number of years (2020: 0.02%, 2021: 0.08%, 2022: 0.13%, 2023: 0.11%, 2024: 0.01%).

 

Terwillegar Drive

 

The question you may be asking after having read through this post is, “Why did you choose to support the final Capital and Operating budgets if some of the savings motions you put forward did not receive approval?” While the increase does achieve what I campaigned on, I heard from many seniors who expressed concerns of increases while being on a fixed income. As mentioned above, I felt we had the opportunity to put a greater focus on proactive programs/services while also bringing down the approved increase by giving a smaller increase to EPS. I understand a more modest increase would have had some risk. But the budgets for EPS have increased by a large margin over the last decade and I felt this was our opportunity to start shifting away from substantial increases so that we can focus on the actions that will help prevent crime.

 

At the same time, the budget savings motion I put forward prior to the beginning of our deliberations was intended to help deal with the desire to see increases kept to a minimum while also allowing us to address areas of growth like the Lewis Farms Recreation Centre and Library. Being that a number of the items were approved to help achieve millions in savings and we were able to fund or set aside the funding for some of the most important new projects and programs, I felt that I should support this budget even though I felt we could have seen a lower increase.

 

In advance of setting the mill rate in April 2019, there will be an opportunity to review some of the additional items listed in the budget savings motion that weren’t immediately approved. With additional information, there may a chance to reduce the increase even more. Although the increases for 2020-2022 have been approved, we will have the opportunity twice a year to review this and make changes as needed. For me, this doesn’t mean there should be an opportunity to increase beyond what has been approved but rather it should provide us with the chance to continue to find savings through our Program and Service Review that can then be applied to bring down the increases in future years. 2.6% should be our ceiling for the next four years to provide certainty for everyone. I’m hopeful that much of the work that will occur over the next few years will allow us to continue to show even greater value for our money.

 

I want to thank all City employees who put together the budget for review. This is not a short process and while there were some passionate debates, the information they provided allowed us to make informed decisions. Finally, I greatly appreciate all the Edmontonians who reached out to give their feedback. Together, the important community investments became more clear, which was critical in deciding what to prioritize. If you have any questions or feedback, please share them in the comments.

 

Written by A. Knack and M. Banister.

 

Leave a Comment