Powell River residents could be facing a steeper tax increase this year compared to last.
City of Powell River’s provisional 2013 budget has a shortfall of $302,076. If that amount was covered through taxation alone, it would require a 6.8 per cent increase.
City staff asked for general direction from elected officials during a budget meeting on March 7. Dave Douglas, director of financial services, explained the shortfall already includes a 3.8 per cent increase on residential taxation and one per cent on business. “Although we’re not asking for specific approval today, we need to know generally where we’re going to go from here,” he said.
Douglas also said that 2013 revenues were down. For example, the city is receiving almost $300,000 less from the provincial government’s strategic community investment fund, a combination of the small community grant and traffic fine revenues. In 2012, the city received $382,779, but in 2013 it is only receiving $83,055.
As well, revenues from building permit fees are down and the assessment on the Westview ferry terminal has been reduced in the wake of an agreement reached between BC Ferries and the provincial government.
Mayor Dave Formosa wanted to know if there was money for his task force on economic revitalization in the budget. As well, Councillor Myrna Leishman pointed out it was important to put funding aside in reserves for asset management.
It emerged during the meeting that funds generated through the 3.8 per cent residential tax increase in 2012 slated for asset management had been used for other expenses. The Peak asked for a breakdown of the expenditure, but the information has not been supplied before deadline.
Mac Fraser, chief administrative officer, suggested $100,000 could be included in the 2013 budget for business development. “I would suggest to you that if you can effectively use money this year for business development, that is a contribution to asset reserves of the future,” he said. “Don’t beat yourself up too badly that the honourable commitment you made of 3.8 per cent previously toward asset reserve can’t happen. What that says is there isn’t enough money in the pot now to suddenly find contribution to reserves, which reinforces your need to grow the revenue, which means you need to grow the community, which means you need to put the money into business development.”
It would be up to elected officials to approve that amount, Fraser said. He also asked councillors to identify a tax increase. “Please tell us X, and we’ll be back at your next meeting to see whether you like that. It’s far from done, but it gives us a ball park.”
Formosa suggested four per cent, but Councillor Debbie Dee threw out five per cent. After more discussion, Dee said, “Hey, Your Worship, meet you in the middle, 4.5?” Formosa agreed.
In the end, everyone agreed and there was direction to staff to prepare a budget based on a 4.5 per cent tax increase.
Powell River Regional Economic Development Society (PRREDS) has asked for an increase of just over $19,000 this year, to create a business development officer position. Its budget is close to $300,000.
When asked why PRREDS is not leading the charge on economic revitalization, Formosa outlined his concept, which is that the economy could be regenerated with small, palatable pieces, as opposed to bigger projects that the community can’t seem to get through. “I started listing things that maybe we could create, things that I know how to do and that I’m good at,” he said.
Formosa shared his plan with his economic development team, Councillor Chris McNaughton and Dee, and they started doing some in-depth work on the list. “There are now about four initiatives that I am personally pushing hard, working on myself.” He added the work is specialized, entrepreneurial activity and it’s hard to employ somebody to do it, but “maybe that’s council’s wish.”
Formosa also said he understands the question, why isn’t PRREDS doing that work. “I get that, I get the confusion, but you just can’t say to somebody, you’re an entrepreneur, go create. This is creation of economic development in an entrepreneurial way using PRREDS heavily as our resource.”
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