Duane Hicks
The fact the Town of Fort Frances is facing a very tough budget year, and more to come down the road, was made clear to council at Monday’s budget meeting, prompting a full review of services for all divisions to find ways to lower the operating budget.
Fort Frances CAO Mark McCaig said administration has worked diligently to reduce the operating budget deficit from $531,268 to $246,612 since the last budget meeting on Jan. 18, but stressed the town must start looking at reducing its costs this year and beyond.
“There’s no easy way to say it—we are facing a tough budget ‘go’ this time,” McCaig warned. “We are facing a tough budget ‘go’ in years to come.
“There’s very clear reasons for that. Some of them are the loss of industrial assessment in the community,” he noted.
“Traditionally when we’ve had our budget shortfalls, administration has been able to go back to the table . . . and find within the projected forecast that we had money,” he remarked. “Maybe we could trim in certain areas, or maybe fine-tune the forecasting a little bit more.
“What’s happened now is you do that exercise continually on a year by year basis and . . . you reach a saturation point where you can’t do it anymore,” McCaig added. “There’s very little wiggle room in what we’ve projected.
“This won’t be an exercise we can count on year after year. We’re very close to the bone.”
One specific area is the landfill and waste diversion, which sees the town having to ship low volumes of recyclables long distances for increasing higher costs and very little funding from the government.
Another is the Fort Frances Airport, where the number of flights is down and, consequently, so are fuel sales.
As well, police costs have risen 18 percent in the last five years.
Yet another factor for municipalities all over is retention pay for emergency services, whereby through the arbitrative process, police, fire, and ambulance workers are getting bonuses based on years of service.
This trend started years ago with the Toronto police as an incentive to retain officers, and soon after, other emergency services elsewhere followed suit.
The problem is municipalities can’t afford to pay more and more every year for these arbitrated increases.
McCaig noted the shortfall, which he admitted still is a “moving target,” has been greater in the past, but he is concerned about this one more than ever because administration “doesn’t see the ability to squeeze anything more out of it.”
“I am going to tell you that on behalf of administration, we are concerned,” he said. “Even though that doesn’t look like a big number right now, the long-term implication is it is not going to trend the other way unless we make some prudent decisions regarding the organization.”
One area he will be addressing is staff wages.
“This budget also does not contemplate any wage increases for any employees in the organization this year, and we are in a collective bargaining year,” McCaig noted. “This is the year perhaps when we approach the employees and say that maybe we do not have the capacity to pass on wage increases.
“Maybe we have to . . . look at all staff members to find synergies and efficiencies among the departments to be able to continue to deliver service levels at what they are with existing staff.”
McCaig noted the town has more than 30 employees over 50 years of age who are approaching retirement, and the town will continue its program of attrition as years pass, which will help in coming years.
“The balancing act is you have to do attrition in a thoughtful and reasonable manner where you do not affect the service level at this point,” he stressed.
McCaig said the town has kept up with wage increases for employees. With the CUPE bargaining group over the past five years, the town has passed on 14 percent wage increases.
The cost of living in Ontario rose just 8.5 percent in that period of time, and nine percent in Canada.
“Maybe this is the year we really talk about having some restraint with regards to passing on wage increases within the organization,” McCaig said. “I think it’s a reasonable prospect to address with all members of the corporation, and we are going to proceed in that vein.”
Mayor Roy Avis suggested the town perhaps look at cutting services, prompting other members of council to agree that the four executive committees need to take a close look at the services the town offers and see if there’s any possible efficiencies.
“Either we cut services or increase revenues somehow, or it’s a combination of both,” said Coun. Andrew Hallikas. “I think we have to be very, very careful when we cut services, but I think everything has to be looked at.
“Maybe that is something that should go back to the executive committees to go through the services and make some recommendations back to this table—maybe get each committee to look at their area and see are there savings that can be achieved with minimal impact,” he added.
“I think it’s prudent to try our best to deliver all the services that we have right now,” said Coun. Paul Ryan.
“And then if you hit the wall, you start to cut services and it’s all you can do,” he remarked, adding the alternative is higher taxes.
Capital budget
On the capital side of the budget, council began to make progress going through items Monday, but did not make it through them all.
It continued the process yesterday afternoon at another committee of the whole budget meeting.
While some trimming was done Monday, the capital budget still sits around $10.2 million.
Some of the items confirmed to stay in it so far include:
•breathing apparatus, a training facility at the airport, and GIS project for fire protection services;
•computer upgrades and a five-drawer bylaw lateral file cabinet for administration;
•a metal cabinet replacement for the Fort Frances Children’s Complex;
•weight room flooring replacement and front overhang repair for the Memorial Sports Centre;
•fuel tank replacement and exterior painting at the Sorting Gap Marina, and Sunny Cove Camp repairs;
•building repairs for the Sister Kennedy Centre;
•Townshend Theatre stage floor replacement (cost split with public school board); and
•a GIS project for Planning and Development and an HVAC system replacement for the Civic Centre.
Several items, such as vehicle purchases for various departments, still need to be decided. Council agreed on a spending limit of $105,000 to buy new vehicles.
Many of the major capital items are in the Operations and Facilities division’s portion of the budget, which mayor and council took a look at yesterday.
They also were expected to discuss establishing water and sewer rates for 2010 at yesterday’s meeting.
