City of Powell River Council will consider a bylaw that will adjust mayor and councillor remuneration upwards.
At the Wednesday, March 27, finance committee meeting, chief financial officer Adam Langenmaier delivered a report that suggests the proposed council remuneration and reimbursement bylaw compensate for changes in income tax law, as well as narrow the gap in pay between the mayor and councillors.
Langenmaier said Canada Revenue Agency (CRA) has made changes this year regarding how remuneration is taxed for local politicians.
“You are facing a bigger tax bill for 2019,” he said.
Prior to 2019, the Canadian Income Tax Act allowed elected officials a one-third, non-taxable allowance. The allowance has been removed and replaced with a reporting allowance, which means elected officials will report expenses incurred from performing their duties on their personal income taxes.
Langenmaier said he had reported to mayor and council a couple of months back and took the feedback from the direction council gave to adjust remuneration so councillors’ remuneration would be where it was prior to the CRA changes.
On the second issue, one of the common threads Langenmaier noted was the mayor to council remuneration ratio: how much councillors are paid in comparison to the mayor. He said councillors are being put under more stress to do more.
“There was an appetite to adjust remuneration to better reflect what is being asked of council now,” said Langenmaier.
He blended the requests and desires of council to come up with a remuneration schedule. Langenmaier noted that the clearest compensation bylaws in other jurisdictions feature a table with the mayor’s and councillors’ remuneration over a period of years. He has gone to that method for Powell River, and what it allows is today’s council making remuneration decisions for the next council.
“The way I’ve constructed the bylaw is there is a shift to adjust council’s pay to make up for tax changes, starting in 2019, and then there is a gradual change to increase council’s pay as a function of the mayor,” said Langenmaier. “The councillors will see an increase over the next five years. The decision made today will have a larger financial impact on the next council.”
The current ratio of mayor to council remuneration is 2.5. Under the proposed bylaw, by 2023, the mayor would make 1.9 times the amount of a councillor.
In 2018, the mayor was paid $49,250 and councillors made $19,700. The proposal for 2019, to make up for the shift in CRA taxation policy, would have the mayor making $56,000, for a 14 per cent increase, and councillors being paid $23,300, which is an 18 per cent increase.
By 2023, the mayor’s remuneration would be $60,600 and councillors would be paid $31,800.
Langenmaier said adjustment would put Powell River near where other similar-sized communities are.
The report from Langenmaier to the finance committee also recommended the per diem payment of $90 per day be removed.
Councillor Maggie Hathaway said she noted the removal of the per diem in Langenmaier’s report and has a hard time with it.
“Things get convoluted; it’s so easy not to have to save every single receipt,” she said. “Per diems were invented to get rid of that whole hassle of having to save all those receipts. It’s a pain. I don’t want to save all the receipts just to get reimbursed.”
Mayor Dave Formosa said he thinks the per diem is the way to go.
“When you travel you spend way more while you’re away than the per diem,” he added.
Councillor Jim Palm said he concurs with Hathaway and likes matters nice and clean cut.
“You don’t have to worry about your meal receipts. It’s the way to go,” he added.
Councillor Cindy Elliott also said she likes per diems.
“It’s less administrative work for everyone,” she added.
Corporate officer Chris Jackson said the finance committee could forward the report to the April 4 city council meeting with the draft bylaw revised to include a per diem amount. The finance committee gave consent to do so.
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