The total operating budget is $58,166,060. City staff made up the difference by making $412,000 worth of budget cuts, diverting 3.2 per cent, or $530,000, of its Fair Share oil and gas royalties from the capital budget to operations and adding a 4.4 per cent increase in tax revenue.
In October, city staff had announced that the city’s operating proposed operating budget was $1.6 million in the red.
Unlike federal and provincial levels of governments, municipalities are not normally allowed to run deficits, so city staff had to find a way to trim operating expenses.
“[Staff] went through each and every line item within their budget and found places to trim,” said Lori Ackerman, Fort St. John’s mayor.
The allocated budgets for some programs were reduced and one program was eliminated, the building inspection – green rebate, saving $50,000.
“We cancelled the program. It wasn’t well prescribed the year before so we took it out,” said Ackerman.
In other areas savings were made not by eliminating program outright, but by reducing their allocation.
Under programs and special events in the operating budget, some entertainment related expenses that were originally slated at $57,000 in the 2013 budget were scaled back to $12,000.
“[The] 2013 budget began at $57,000 but the actual [spending] in 2012 was only $6,608. Now, in 2011, the actual amount spent was $48,532 but even at that we didn’t hit the $57,000 number,” said Ackerman, explaining that cut.
Of the total $680,000 allocated for projects, the lion’s share, $400,000, is going towards the city’s expenses for the BC Hydro Site C project.
Another big-ticket item on the operating projects part of the budget is the downtown action plan that is budgeted at $125,000.
The big dollar commitment to projects for Site C means a lot of the projects that the city would like to undertake are on hold for this year.
The increase in tax revenue is evaluated at 4.4 per cent, but that is attributed to an estimated increase in property values as opposed to an increase in the tax rate.
In her presentation to council and the public, Dianne Hunter, the city manager, noted the pressures the city faces in maintaining the quality of service while minimizing expenses.
For instance, she noted an 8.6 per cent, or $500,000, increase in the city’s contract with the RCMP.
Another problem is the difficulty of attracting and keeping qualified personnel in a competitive marketplace, especially with ever increasing competition for skilled workers from the private sector.