Yorkton Council found out at its regular meeting Monday that the City’s 2016 budget is running significantly in the red.
And the deficit is being clearly blamed on Saskatchewan Municipal Board decisions.
The report forecasted an expected deficit of $586,000, which is a $712,000 change from the $126,000 surplus which was forecast for the quarter one report to Council.
“This $712,000 loss is mainly due to the Saskatchewan Municipal Board decisions that resulted in a $700,731 property tax loss,” explained Amber Matechuk, City Controller at the regular meeting of Yorkton Council Monday.
“The remainder of the loss is due to additional tax incentives that have been approved for payment in the 2016 year.”
Councillor Randy Goulden she is “very disappointed” with what transpired with the appeals of assessments provided through Saskatchewan Assessment Management Agency (SAMA).
With the uncertainty now surrounding assessments Goulden asked “how do we go about doing our city budgets.”
The concern revolves around an expectation of property tax revenues based in assessments, which are not standing up to appeals.
“We lost every single appeal,” noted Coun. Ross Fisher.
City Manager City Kaal said typically the City has $100,000 set aside to offset appeal losses.
“Typically it’s well below that number,” she said.
This year true appeal losses are far from typical.
“You expect to lose a few, but you don’t expect to lose all of them,” said Kaal.
To put the assessment losses in contest it would require a five per cent tax increase “to make up just the commercial appeal losses.”
Fisher said the City has discussed options to SAMA assessments in the past, and added it might be time to revisit the idea.
Kaal said the software and staffing would certainly cost more than SAMA.
But Council still suggested Administration talk to other small cities about a cooperative alternative to SAMA.
Mayor Bob Maloney said it is an issue that must be addressed.
“In my time on Council I’ve never seen anything as important as this,” he said, adding he wrote provincial Minister of Government Relations Jim Reiter, but the reply provided no answers, but did pass his concerns within government.
Without the assessment appeal losses, Matechuk said the budget is actually on target, based largely on less staff numbers.
“Further to the financial report submitted, Finance has done an analysis in regards to the wages and positions of the City of Yorkton. The 2016 budgeted wages equate to 189.59 Full Time Equivalents (FTE’s). As of June 30, 2016 the City of Yorkton is operating by using 178.47 FTE’s. The budgeted annual wage of one FTE is approximately $60,600. This would indicate that the wages as of June 30, 2016 should be about $337,000 under budget. When comparing wages in the financial report we found that they are actually under budget by about $409,500,” detailed the report circulated to Council Monday.
