Town’s shortfall projected near $2.8 million

Council received the 2004 operating and capital forecast report last night—a document showing a projected operating shortfall of $2,792,030, which translates into a 67.5 percent residential tax increase if town council and management don’t make some serious changes in the near future.
“This package is essentially the beginning of a comprehensive process that will involve the thorough examination of the town’s finances and all factors regarding the provision of services,” acting CAO Mark McCaig told council at last night’s meeting.
“The management staff has collectively examined the finances of the town with the goal of providing a credible depiction of the current and future financial health of the town,” he noted.
“This process began in earnest in October of 2003, when it became apparent through the 2002 financial audit that there were serious and potentially ongoing deficit issues facing the town,” McCaig added.
“The reality in 2004 is that a significant operating shortfall of $2,792,030 exists,” he said.
“These forecasts utilize current taxation and user fees. So in other words, we’ve effected no changes whatsoever—it’s exactly what it is.
“It’s how we operate, with the current fees and taxes we recover along with anticipated increases.”^The report also noted anticipated increases, such as salaries, and uncontrollable costs, such as those the town pays to the Northwestern Health Unit, District Social Services Administration Board, Rainycrest Home for the Aged, and OPP.
Furthermore, the town has longterm debt payments to make while seeing reduced revenues from interest on reserve funds—both of which partially are due to budget deficits from 2002 and 2003.
“There must be an appreciation that the deficit situation did not occur overnight and a quick fix scenario is unlikely,” warned McCaig.
“A long-term plan should be implemented to eradicate the deficit position and ensure it never occurs again,” he stressed.
“This will occur through a significant commitment to consistent financial controls, and the provision of accurate and routinely reporting to assist mayor, council, and staff in the decision-making process.
“They must adapt a stance of financial self-preservation,” concluded McCaig, adding he’s recommending that “this mayor and council schedule a series of meetings, specifically addressing the issues of taxation, fee schedules, and controllable expenditures as they relate to the operating forecast.”^A strategic planning session to identify the core and operational priorities of the town, as well as priorize its activities, also was among McCaig’s recommendations.
Council received the report, and agreed to sit down tomorrow (Wednesday) at 4 p.m. to schedule meetings for both staff and the public. The forecast also has been forwarded to management of the various municipal divisions.
Also at last night’s meeting, council passed a bylaw to authorize the entering into of certain contracts with respect to the provision of janitorial services.
These contracts are with Susan Deslauriers, Tom Pitrowski, and Florence Ogden for their services at the Public Works offices, Children’s Complex, and public library, respectively.
Council also passed a bylaw to authorize a franchise agreement between the Corporation of the Town of Fort Frances and Union Gas Ltd. for a third and final reading and subsequent passing.
Also last night, council:
•granted a break open ticket licence to the Border Figure Skating Club for sales at Sparky’s Confectionary from Jan. 27-July 27, 2004;
•granted a request from the Heart and Stroke Foundation to proclaim February 2004 as “Heart Month “ in Fort Frances;
•agreed to a request from the Township of Chapple for support of its resolution regarding Alternate Victim Services Program funding;
•referred a request from the Township of Atikokan to support its resolution regarding the closure of Atikokan’s coal-fired thermal generating station to the Fort Frances Power Corp. for their input; and
•referred a request from the O.F.A.H.—for a letter to Premier Dalton McGuinty regarding the province’s decision not to reinstate the spring bear hunt—to the town’s Planning and Development executive committee, with input from the Economic Development Adv-sory Committee.