Armstrong council has issued a challenge to staff.
And a tough challenge at that.
Council has requested staff take another look at the city’s approved budget for 2020 and, in the wake of these times living under a COVID-19 pandemic, see if it can take a proposed 2.5 per cent tax increase and 2.5 per cent surcharge for infrastructure and come back with no increases.
“I’m not sure a zero increase can happen but we gave them a target and a challenge,” Armstrong Mayor Chris Pieper said as council looks for ways to provide financial relief for its residents during the pandemic.
“If we can amend the budget, which has already been approved, we have to look at doing that.”
Pieper said discussions have centred around delaying the infrastructure surcharge for a year, or save money by not sending council members to any conventions in 2020.
Staff was given a bit of time to see if they could pare down the budget.
“We challenged staff to bring this back in two weeks and see how much we can bring it down,” the mayor said.
Council acknowledged at its first Zoom (video conferencing) meeting that the coronavirus has caused hardship to residents, businesses and governments around the world. Staff wanted to hold a chat with council regarding some options the city could consider to help alleviate the municipal impact on customers.
The billing for utilities for the period October to March for semi-annual users and January to March for quarterly users has been concluded and cannot be changed. The due date, however, was extended seven weeks to June 1 to allow for payment.
For future billing periods, council was given a number of options;
- A 50 per cent reduction of fixed fees for six months which would cost each user $125 but the city would lose $325,000 in revenue;
- Implement a $50 reduction of fixed fees for six months. That would cost each user $50 and the city would be out $130,000;
- Eliminate tiered consumption rates for six months. This would impact 340 residential and 50 commercial users, and cost the city $60,000 in revenue;
- Lower the overdue penalty rate which is currently 10 per cent and generated $30,000 in revenue in 2019. With more accounts anticipated to go unpaid, according to a staff report, reducing the rate would still generate the same amount of revenue and lessen the impact on individual accounts.
The city’s water and sewer funds are funded by reserves and user fees, not from taxation revenue. Any cuts to these funds would depend on how large the change would affect the city’s ability to fund operations.
Water and sewer are considered essential services by Victoria and Ottawa and the city must continue to provide the services throughout the COVID-19 crisis.
The matters will again be discussed at a future Armstrong council meeting.