The first draft of the 2016 Town of Bonnyville budget tabled at council last week revealed that tough decisions lie ahead for council.
The initial draft of next year's operating budget showed a $777,777 deficit, as a variety of expenses are set to increase in 2016.
By far the biggest jump in expenses the town will face in 2016 is a $300,000 increase in staff salaries due to a four per cent rise in wages for municipal employees as per a collective bargaining agreement.
An extra $226,000 in funding for the local RCMP, $125,000 for new and replaced streetlights, and $50,000 towards the Centennial Centre also topped the list of new expenses.
These new expenses combined with expected decreases of $150,000 in sewer revenue and $75,000 in bulk water revenue have put the town in a difficult situation.
“We don't want to start losing services that residents in this community have started to enjoy,” said Mayor Gene Sobolewski.
“It is just going to be trying to keep status quo as much as we can.”
According to councillors, the issue for the Town is going to be trying to maintain the services in the community, while also finding a way to offset the projected deficit.
Coun. Ray Prevost proposed several ways council might be able to cut down on the deficit, with some of those involving the municipality pulling money out of reserves to cover the rising expenses.
His plan also included the proposition of a small tax increase for the residents and businesses in Bonnyville. Knowing that the current economy couldn't handle a large increase, Prevost suggested a two to three per cent tax hike.
“I think maybe we will have to tighten the belts and be a bit leaner,” said Sobolewski. “We have labour increasing. We have fuel increasing. If we don't receive our rates in water and sewer that utility is going to be hurting as well.”
While extremely preliminary, the budget was presented to council on Oct. 27 to get their initial thoughts and ideas, so administration could get a direction on how to move forward.
“How are we going to offset this deficit? Asked Coun. Nestor Kunec. “There are two ways; increase taxes, or cut services…and I don't know what we would cut.”
The opening discussion around the 2016 budget solely focused on the 31-page operating budget, which is completely separate of the town's capital budget. The operational budget only consists of the departments and services offered by the town, it does not include capital projects such as infrastructure upgrades.
“I would like to see if there are some needs that we are looking at, and perhaps postponing them for next year or the year after,” said Sobolewski.
Council tasked administration with the job of reworking the operational budget to show the effects of a two per cent tax increase. This version of the budget, a second draft, will be presented at the Nov. 24 council meeting.
The public will have a chance to provide their input on the budget during a public meeting on Dec. 1.
An initial 2016 capital budget shows an approximate $2.5 million in surplus funds, as many projects for the coming year have yet to be decided upon.
The first draft shows $6.36 million in expected capital revenue and only $3.85 million allocated to a variety of capital investments.
It is clear these numbers are very preliminary as they are nowhere close to the $11.4 million in expenses and $12.75 million in revenue seen in the 2015 budget.
Some projects listed on the preliminary draft include: $1 million for the continuation of the 51st Ave. project, $159,000 for washroom facilities and a parking lot at the splash park, $138,000 to fix the back alley behind the MD offices, $40,000 for a playground structure for Beaupre Park, $40,000 to replace the grout among the tiles that line the bottom of the swimming pool, and $10,000 for skateboard park equipment upgrades.
The three largest capital projects the town could be tackling in 2016 include exterior repairs for the FCSS building, expansion and renovations to the public library and moving forward with plans for a new Town Hall building. The amount of money they will be allocating to these projects has yet to be determined.
