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Changes coming to 2022 budget which goes to council Monday

Proposed property tax hike reduced to 5.11 percent, but utility rate hike could go to 5.5 percent
Budget Thursday
North Battleford council held their third budget deliberation meeting Thursday night over the Zoom platform.

NORTH BATTLEFORD - Some changes have been made to the 2022 North Battleford budget which will go to council on Monday, and for city residents it is a combination of good news and bad news.

The following came out of the latest Special Planning Committee meeting to discuss the budget on Thursday night. 

The good news: the proposed property tax increase is now revised down to 5.11 percent, well below the originally proposed 7.48 percent. 

The 5.11 percent hike is the recommendation going to council Monday. Administration has pared down an additional .47 from the RCMP costs, and pared down another 1.08 by turning to reserves for patching work. The new proposal going to council Monday now calls for a 3.77 percent increase related to RCMP costs, and a 1.34 percent increase in operations. 

The bad news: the proposed utility increase could possibly be adjusted upward to 5.5 percent from the originally proposed three percent.

The reason is due to concerns around the table that the three percent hike is not going to be enough to cover rising utilities costs, particularly on the sewer side. As Director of Finance Brent Nadon pointed out, the actual cost of borrowing is closer to 10 or 11 percent. 

This was a particular concern for council, as they are looking to borrow upwards of $7.5 million for their major sanitary sewer project that is currently under way. Council has scheduled a special meeting for Nov. 20 to deal with the sanitary sewer borrowing. 

“It’s not something that’s potentially going to come. It’s coming,” said Mayor David Gillan of the rising utility costs facing the city.

City Manager Randy Patrick explained that with an annual three percent increase in utilities, they were looking at subsiding Sanitary Sewer out of reserves at $740,000 over a four year period by not charging the full rate.

Both Gillan and Lightfoot were open to a 5.5 percent increase for utilities. Councillor Len Taylor preferred the three percent currently on the table, but acknowledged "we are going to have a couple of challenging years."

The sentiment from council was for some further information and numbers to be provided to council Monday before a final decision is made. Patrick pledged to have that information to council by the end of this week.

The ugly news: no matter what, North Battleford taxpayers are looking at increases in coming years. Rising costs in general were a major discussion point at the meeting.

Councillors including Greg Lightfoot noted the impact of inflation. He said both the Federal Reserve and the Bank of Canada have suggested “inflation for the next three or five years will not be transitory — it will be longer term.”

He said to expect inflation rates of four to four and a half percent for the next five years.

“We’d better be prepared for that,” said Lightfoot. He also noted the 1.34 percent increase for operations as minor and worried operations costs  would go up even more in coming years.

He said taxpayers in North Battleford “have to be prepared to foot the bill in the future, because that’s all we’re doing is kicking the can down the road.

One item that came up Thursday was an update on what to do about the water tower lights replacement, which came up during the previous deliberations. 

There has been a suggestion that city reserves could be used to fund the replacement lights, which would cost upwards of $200,000.

But that might not be necessary. Nadon reported Thursday that they are talking to a potential funder about the project. 

Nadon reported they do not expect a response for a number of weeks and months but if that comes through, the funds will not be drawn out of reserves as proposed. Either way, there is no impact on the tax rate this year.

The next step now is for the 2022 budget to go to the regular council meeting Monday.