Skip to main content

Red Deer Council looking to residents for budget priorities

Share

Ken Johnston, mayor of Red Deer, discusses the city’s public engagement to address the budget shortfall with Alberta Primetime host Michael Higgins.

 

This interview has been edited for clarity and length.

 

Michael Higgins: Your council said to be staring down a budget shortfall between $17 and $19 million. How significant is that for a city the size of Red Deer?

Ken Johnston: It's quite significant. Certainly in the 12 years that I've had in public service, this is the toughest budget that we've approached. At this point in time, it's been what I would call a very exhaustive exercise this year, in terms of looking at all of our service levels, all of the public expectations and so on.

There’s still work to be done, and certainly no stone will be left unturned. In our view of this, we understand its impact, but still, Red Deer is certainly not alone. This is a tough time for municipalities, in many respects, and certainly the challenges are evident for everybody across the board.

MH: What puts you in this position? What's driving those financial pressures?

KJ: A lot of it is certainly cumulative in the context of our revenues haven't bounced back as quickly as we would have hoped from COVID. Certainly the inflationary impacts on the cost of doing business in the city has also been a terrific contributor.

We had a series of low tax years, including a couple of zero per cent years. Those caused us to look more inward on our reserves to finance the services that our public is looking for.

At this point in time we have to make those tough choices to be able to say, ‘What services do we value, what services do our public want to see?’ There’s no question that provincial cutbacks have really affected us. Things like provinces not paying property taxes on their own buildings, that's about a $2.5 million impact to us this year. But we're not alone, as I said, other cities definitely find themselves in this situation.

MH: Obviously you're looking for ways to save some cash, but what could this translate to in terms of a tax increase for your ratepayers?

KJ: I'll say this, a budget is all about services. And does the public want or expect the suite of services that the city could deliver? If we can't find more alternatives, more options and so on, it could result in a tax increase between eight and 10 per cent.

That would give us the ability to not only have a surplus in this budget, but also contribute back to reserves, which ensure our sustainability for the for the years ahead.

The public actually has been awesome. We put a survey out for input just a few days ago, and they certainly understand that city services cost, not unlike your own household budget. The ability to have reliable electricity, water, transit, policing, fire departments, those kinds of things. Good parks, good recreation centres, good hockey rinks, all those things.

I really am encouraged with some of the comments that I'm seeing in the survey and it'll be the council's job now to be able to wrestle with those numbers at the end of November.

MH: Red Deer Council just passed a utility fees hike, it works out to an average increase $15 a month or so. How does that play into the bottom line here?

KJ: Although council owns its own utilities, utilities are separate and distinct from the operating budget. So what we did with utilities was ensure that we could keep pace with inflation and also have those investments in those reserves that we’ll need for key infrastructure.

The costs, and this includes electric waste, wastewater and water, are about an additional $15 a month across all four of those utilities, not just one particular utility.

But they are separate and distinct, and they allow us to make the improvements in utilities as we go forward,

MH: We spoke just a few months back about the premier pondering tenfold growth for Red Deer. Given what council is facing now, what do you see for the road forward if your population continues to swell?

KJ: We are growing, and certainly that's also a stressor on our budget because you have to get in and you have to make sure your streets are maintained, make sure your police force is equipped, your fire department is equipped, your schools, and all those good things are absorbing the growth.

We're on what I would call a growth trajectory now, and we are really, in some ways, making up for some of the budgets past. The key thing for us is to understand that we need not only to have a surplus in the budget, but to contribute back to the reserves that we have leaned on, certainly since the COVID times.

Certainly, we felt some key infrastructure, like our Westerner for example. Over the years that's also impacted us.

It is a challenging budget, no question. But in many ways it'll prepare us for the years that are ahead of us, which I think will be wonderful for the city.

CTVNews.ca Top Stories

Trudeau's Liberals launching new ads, MPs told in caucus meeting

Prime Minister Justin Trudeau faced his caucus for the first time Wednesday since rebuffing calls from two dozen Liberals to resign. He seemed to satiate some MPs’ concerns, with a presentation on party campaign strategy that includes rolling out new ads.

Stay Connected