In his December monthly column Mayor Nenshi touted his
accomplishments and budgeting prowess.
Among other things he explained how the three year budget works, how
Council was able to invest in the community, and transit; all of this supported
by his ability to provide Calgarians with the lowest property taxes.
On Wednesday 19 of December, amid a flow of bad news
concerning transfers from other levels of government, he acknowledged that
there is no civic do-it yourself plan or any plan’B’.
Calgarians should not be surprised by all this rhetoric. The
Institute for Public Sector Accountability (IPSA) has been monitoring city hall
for over 15 years. It is no surprise that there is no plan ‘B’, in fact the
only plan that exist at city hall is – more taxes. Over the years Calgarians
have been served a number of whoppers that need to be clarified.
The three year budget is computed with the help of The
Municipal Price Index (MPI), which is made up of the largest operating expense-
wages. Instead of using the Consumer Price index the city persist to use the
MPI which never goes down because of ever increasing labor costs. As for the
lowest property taxes, the Mayor does not state that his higher than expected
revenues is made up of ever increasing fees and utility rates. Many Herald
readers have properly stated that the tax increases were much larger that the
Mayor portrays. Last year the rate was closer to 10% because when the province
vacated the education portion he very quickly appropriated it. This year with a
package of fee and rates increases, most Calgarians will see another $100
disappear from their pockets into the municipal coffers
While IPSA maintains that education should not be financed
by property taxes, we cannot condone the appropriation of the education tax
collected by the city. If the province decides to vacate the education raised
through property taxes, they will have to raise taxes from somewhere else
otherwise there will be a gap in education funding. Alternatively this could
mean that the city will now have a larger tax base made up of property and
education taxes. In addition the province will charge us another tax to cover
the decrease in revenues. Vacating the education portion of the tax by the
province is not a solution, In fact if there is no proper reform of the entire
municipal tax collection Albertans will once again be fleeced by both levels of
government.
The Mayor’s comments are frustrating because you would have
thought that as a former finance lecturer he would be less gullible to the
administration’s rhetoric. Before telling us how great 2012 has been, perhaps
he should explain how his zero-based review process differs from zero base
budgeting and how and where the efficiencies have been found. More importantly
Calgarians deserve to know how much these savings were in traceable dollars.
This semantic game has been played before under Mayor Al Duerr who promised
millions in savings through an administration restructuring. Calgarians never
saw any tax reduction, but we had the creation of a new large pension funds for
executives. Today the mayor tells us that he is investing (sic. Spending) the
savings without telling us how much they were.
Watch for his next move in the New Year. He will need to increase utility rates to
fund maintenance and replacements. However he will not tell Calgarians that
until a motion in 2005 by Alderman McIver based on a report called ‘A case for
controlling utility rates’, the water and wastewater utilities were being fleeced
by at least $50 million, if not more, each annually. Mc Iver’s motion put a cap
on this vicarious tax. Had the utilities kept their revenues they would now
have reserves in the hundreds of millions to use for replacement and maintenance.
Or better still there would have been no need for past rate increases.
Truth is nothing has changed at city hall. Transparency is
still missing and Calgarians are sold a bill of goods. We are investing instead
of spending. We blame other levels of government and raise taxes under the
guise of giving the public what they want, while spending to create what the
politicians want.
It seems that the promise of a different Mayor under the
purple revolution has been greatly exaggerated.
Marcel Latouche
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