The residents of the City of Cold Lake will be paying a little bit extra in municipal taxes this year.
On Wednesday, Dec. 14, during a special meeting, city council approved their 2017 operating and capital budgets, including a two per cent tax increase.
Mayor Craig Copeland said taxes have remained unchanged over the last four years, and for the most part, it seems as though locals understand the need for a slight rise in taxes.
“Costs were starting to catch up to us, and I think having a two per cent tax increase, when you look at it over the last four years is pretty good,” said Copeland. “We can't be going to the air weapons range money all of the time for operating.”
Council also approved using $696,000 from the 2016 accumulated surplus in order to cover the cost of several projects over the next year. The funds will go toward crushing at the landfill, which has been budgeted at $300,000, a contingency for the ambulance service at $250,000, Canada 150 celebrations coming in at $40,000, a total of $50,000 in museum capital projects, and over $56,000 for library renovations.
Those sitting at the table were reluctant to take on any further debt, due to the provincial government's review of the ID 349 agreement with the city. This was kept in mind when creating both their operating and capital budget.
“When you take on debt, you want to make sure you have the revenue to back the debt. The ID 349 agreement with the province is being reviewed, and because we don't have any guarantee going forward, council was reluctant to handcuff any future councils with an even higher debt load,” Copeland explained.
This year alone, the CLAWR agreement will provide the City of Cold Lake a total of $25 million in revenue. This amount, Copeland said, is “significant, and makes an entire world of a difference,” to the city.
Operating budget nearly $60 million for 2017
The city's operating budget is set at almost $60 million, with approximately 42 per cent in tax revenue, or $8 million, coming from CLAWR. The city will also see a $72,000 income from the EMS lease of the new downtown fire hall.
This budget includes a $1.5 million allowance for uncollected taxes, and a transfer to the capital budget to a tune of $18.5 million. This funding will help cover the cost of replacing and providing new infrastructure within city limits.
A total of over $44.7 million in tax revenue was distributed in this budget, including money brought in from a two per cent tax rate increase, with the balance remaining being funded from grants and user fees. Along with approving the 2017 operating budget, council opted for a five per cent increase in water and sewer rates. However, they could decide to take a second look at it once the effects of the new carbon tax have been determined. Any changes would have to be finalized prior to the tax rates being set in the spring.
One item affecting the 2017 operating budget is the cost of policing, which has increased due to a rise in population, putting Cold Lake over 15,000 residents. This increase will bump the city from paying 70 per cent of the policing costs to now dishing out 90 per cent. The extra expense weighed in at $396,000 for just three quarters of the year. It doesn't include overtime and other adjustments, which were budgeted at a total of $106,000.
“The tax increase is basically going towards an increase in the RCMP costs,” explained Copeland.
CAO Kevin Nagoya and city administration worked to help cut back on nearly $1.5 million in operating costs.
“They looked at their entire organization to see where they could cut, and they cut a lot of areas,” Copeland said.
Capital budget funded mostly by CLAWR
The capital budget includes a number of infrastructure projects, sitting at over $19.7 million in expenses for the city this year.
“There are so many projects we can do within the City of Cold Lake, but we were reluctant,” said Copeland, referring back to the review of ID 349, and not wanting to “handcuff future councils.”
The city will be working on projects such as environmental/utility infrastructure improvements at a total cost of $2 million, as well as roadway infrastructure improvements at $6.4 million. Fleet and equipment infrastructure costing almost $2.6 million, a total of $165,000 is set for facilities infrastructure, and $410,000 in recreation infrastructure.
This year, the city will begin working on phase three of the Cold Lake Energy Centre, which includes construction of the arena. The $2 million set aside for the project will be coming directly from CLAWR funding.
“That's really going to help hockey in Cold Lake, and it's really going to improve the access to the site,” Copeland said.
Council has also budgeted for an expansion to the local RCMP detachment, with the overall project budgeted for $3.5 million.
Highway 28 will see continued construction this year, from 47 Ave. to 51 St. This project rang in at $2 million in funding.
Also budgeted at $2 million is construction of the new artificial turf field, which will begin in 2017.
“The football players have waited a long time, and to have an elite soccer field and football field with nice turf… it's going to be in a great location and I am really excited about that project,” noted Copeland, adding they are hoping to begin construction in the spring.
Putting a focus on recreation, a new mountain bike park is also listed in projects for next year.
The funding source comes primarily from CLAWR, at $16 million. Using the city's restricted surplus accounts for $1.25 million, general surplus at $435,000 and over $2 million in grant funding.
Council didn't allocate funding to a specific project for Municipal Sustainability Incentive (MSI) funding.
“We chose not to budget for them at all, and wait until the money comes in, because we may not have a project approved until 2018 anyways,” said Linda Mortenson, general manager of community services for the City of Cold Lake. “When we know for sure we are getting it, we will include it in our budget.”
Copeland added that the MSI funding would provide over $3 million to the city, and since that is not guaranteed, council is holding off on a few projects.
“We are not taking a step back, we are just not going to be doing a good $10 million in capital this year compared to years before.”
The city will be hosting a community open house in January to review the budget with residents.
Cold Lake sits on the hot seat of CFIB for spending
The Canadian Federation of Independent Business (CFIB) recently released the seventh edition of the Alberta Municipal Spending Watch report.
The report details municipalities from across Alberta, ranking them based on their spending habits in comparison with their population.
With only a 36 per cent population growth from 2004-2014, the City of Cold Lake increased 159 per cent in operating spending over the same 10-year span. The city's overall provincial rank on this list, which rates one the best and 180 the worst, was 149.
Copeland said although the CFIB takes population and spending into consideration, there is one important factor they are failing to recognize.
“They don't spend any time in your community to understand why your operating goes up,” explained Copeland. “They are a statistic based organization, and they don't understand if your increase went up, why it went up.”
Copeland continued, that although the city's debt seemed to increase, money still came in.
“They are an organization that is not, in my mind, very credible.”
According to Copeland, the city has worked hard and focused on infrastructure, using funding from ID 349 to help grow. This in turn has increased operating costs.
“We are trying to be the community choice in northeastern Alberta… we are trying to be the place you want to be… I think we have a lot to offer.”
