The budget deliberations are heating up in council chambers as city staff and council work to balance their desire to maintain services and the need to cut items to make up for a $1.2 million shortfall.

In Dec. 2011, council provided city staff with the mandate to maintain current levels of service and allow for a three per cent increase in revenue by raising taxes, user fees or other community revenues.

However, challenges were quickly identified with that mandate including the fact that maintaining services does not adhere to the need to create much needed infrastructure in the community including new sidewalks and roads, a new dog park and new subdivisions to address the growing population.

It was also noted that a three per cent increase in revenue does not mirror the increase in external expenditures, and getting those additional funds through increases to recreation user fees, building permit fees and other community fees and charges is challenged by existing bylaws and policies.

All in, the total proposed revenue for 2012 is $53,902,613, which is funded by various sources including taxation, grants, partnerships and reserves.

However, the total proposed expenses for 2012 equals out to $55,173,464, leaving a shortfall of $1,270,850. This is based on a three per cent increase in tax revenue and does not include new projects or any additions to staffing in 2012 for the city.

To address the shortfall, council must now review all proposed projects, requests for aid and city costs to begin making necessary cuts to balance the budget. They are also looking at additional ways to find revenue including possibly bringing in 2.5 per cent of its fair share funding and stabilization funds.

One of the initial external pressures that was identified to the budget was the consumer price index, but Councilor Dan Davies suggested that one was perhaps needed for Fort St. John in particular.

Upon investigation, city staff created a price index document and found that the consistent “basket of goods” that the city needs to fund annually, including staff salaries, the RCMP contract, electricity, natural gas, fuel and insurance has been steadily climbing over the past few years.

The increase in costs for these items alone was over $1.5 million from 2010 to 2011, equivalent to an 8.4 per cent increase.

Council is also looking closely at the Grants in Aid program, as the 2012 requests are a record high with 23 organizations requesting over $1.2 million in funding.

As council decides which groups will receive funding and which will be declined, they are also looking at the base budget grant policy and considering the parameters of eligibility, as well as placing a cap on the amount of funding available in the future.

The primary items on the agenda for the Feb. 1 meeting were in-depth looks at the proposed studies for 2012, with a common theme emerging as cost versus benefit.

This year, 16 studies and mapping projects have been proposed at a total cost of $600,000 in the 2012 budget and $450,000 in subsequent budget years.

A few of the studies have been identified as priorities, including the Downtown Action Plan that has been talked about for years.

“I think some citizens are getting disenfranchised with the continued discussion but the lack of action,” said Mayor Ackerman.

City Manager Dianne Hunter pointed out that the project was put on the backburner while the city developed and adopted the Official Community Plan in order to ensure that they had a clear picture of community needs before moving forward with downtown revitalization.

At a cost of $125,000 this year and $155,000 over the next four budget years, the Downtown Action Plan and Traffic Study will examine the downtown area and the desires of the community to develop a plan to enhance it and make it a vibrant part of the community.

Tying in to this is also a Market Vacancy Study, at a total cost of $40,000, to obtain accurate data on vacant land in city boundaries. Hunter explained that this would become a planning tool to ensure that council was making policy decisions with complete information.

Many energy-related studies came up that sparked a discussion about the cost versus benefit in the community and the necessity of completing these immediately.

The City Electricity Reduction Challenge was identified as being valuable, but council questioned whether or not changes could be made to the program to reduce the $10,000 price tag.

Councilor Trevor Bolin pointed out that it is a large cost when only 200 people in the community participated and benefited from it.

Council discussed whether subsidizing the cost of the clotheslines handed out for this program as opposed to giving them away for free would be a better way to go. Hunter noted that it may be because there is a higher perceived value when somebody purchases something, even at a reduced price, than when it is just handed to them.

Solar mapping was also discussed, and council again noted the high cost at $30,000 with few people in the community benefiting from it. It was estimated that only a couple of households have sought out the opportunity to retrofit existing homes with solar power in the last couple of years, and Bolin questioned whether the city should continue to bank money in to a program that doesn’t seem to be garnering a lot of community response.

Council also questioned whether any of these studies could be completed in-house, as opposed to contracting them out to consultants, and Hunter noted that the city did not have the manpower or expertise in some cases to complete these.

For example, City Planner Kevin Brooks explained that they could likely do the Market Vacancy in-house, but it would likely take up to up to seven years because of capacity, and the information would be obsolete by that time.

City staff are now looking at the feedback and requests of council to come up with a proposed tax rate, which will be presented at a public meeting on Monday, Feb. 6 from 5 p.m. – 7 p.m. at City Hall in council chambers.

This meeting will be an opportunity for the public to provide council with direction on their desires for the budget and to voice what projects they think should be a priority.

Budget presentations are available for review at www.fortstjohn.ca.