Kimberley’s five year financial plan received its first three readings at City Council on Monday, April 27.
Council discussed five major highlights of the plan, which were significant factors that influenced the figures they were working with.
The COVID-19 pandemic is a major factor in the city’s financial forecasting. The crisis resulted in the early shutdown of the Civic Centre and an extended shutdown of the Aquatic Centre, plus the layoff of facility staff.
The City also implemented a hiring freeze that deferred recruitment of two previously-approved new planning department positions until January, 2021 and the replacement of an Assistant Fire Chief until July.
Those two factors resulted in savings of $226,699.
There was also an Aquatic Centre Wage Adjustment which resulted in an expenditure increase of about $135,800, stemming from a job evaluation system, undergone with the United Steel Workers, resulting in wage costs increasing by approximately 22 per cent. This was offset by several initiatives, including increasing user fees on the facilities by an additional five per cent on April 1, and an increase on the Aquatic Centre parcel tax.
If the Aquatic Centre stays shut down beyond June 1, the City will have some additional savings, roughly $80,000 to $100,000 per each month of closure, which will be added to the accumulated surplus that Council could then reallocate next year. If the Centre opens earlier than June 1, they will end up short of their projections.
“Make no mistake, the earlier we get it open the better,” said Mayor Don McCormick. “I’m not suggesting that we have a prolonged shutdown at all, but there could be a positive unintended consequence there.”
Last December, the City formalized its intent to sell the Kimberley Riverside Campground. In anticipation that the campground will sell sometime in the 2020 operating season, the City removed a previously budgeted $100,000 in revenue relating to the profit sharing agreement defined in the campground’s operating agreement.
At a special budget meeting on April 6, Council approved changes to the operating budget that required 1.35 per cent increase to municipal property tax. This was then reconsidered by the City in an effort to provide relief to property owners impacted by the crisis, and the increase was set to zero per cent for this year.
Council directed $135,559 to be transferred from the Accumulated Operating Surplus to replace lost tax revenue as a result of this decision. The total amount transferred from the Accumulated Operating Surplus was reduced to $77,242 due to reduced debt repayment costs stemming from an interest adjustment and a final calculation of Flat Tax based on an increased residential lot count.
“We still don’t know what the full impact to the City is going to be,” said Chief Financial Officer Jim Hendricks.
“It could have further impact on the City’s revenues and expenditures and our ability to provide projects and services throughout the year. So in all likelihood we may end up bringing a financial plan bylaw amendment before council if there are material changes as a result.”
McCormick commended staff for their work on the five year plan, saying that it’s “well laid out, understandable and an awesome plan.” The full details of the plan are available on the city website.