To begin with, I'd like to attach a copy of the 2012 Budget Overview presentation which staff gave to Council this past Monday January 24th (click here) . I think your readers will find it very informative and it provides a very good context to the upcoming budget deliberations as well as explaining the various pressures (at a high level) facing the City of Hamilton.
The presentation can also be viewed online using the following link : http://www.hamilton.ca/NR/rdonlyres/1B43AA7B-9C39-429B-A9FE-BC2BE2DA91BB/0/Jan24GICOverviewFINAL.pdf
Also, additional budget materials can be found by visiting our web site at www.hamilton.ca and clicking the "Learn about the 2012 Tax and Rate Budgets" under the "Hot Topics" section located on the right side of our home page.
I will now address your specific questions:
1) What elements of the budget does council have a degree of maneuverability or flexibility over, and what elements are fixed and provide little or no latitude?
If you go to Slide 18 of the above presentation,
the pie chart shows the constraints or degree of maneuverability we have in trying to reach our budget goal of a 0% tax change. Almost 2/3rds of our budget has limited or very little flexibility because it is comprised of:
Emergency Services (32%) where employee costs are around 90% of the budget and are subject to arbitration rulings and strict collective agreements;
Mandated Health and Social Services (16%) like social housing, social assistance, public health, etc.;
Boards and Agencies (7%), of which, most are mandated; and
Capital Financing (12%) as Council struggles to keep our infrastructure in a state of good repair.
This basically leaves only 1/3rd of the Budget to find most of the savings required to reach a 0% tax change.
2) With reference to those elements that do allow for maneuverability or flexibility, what would you say are going to be the top 3 toughest decisions council will be facing, to hold down taxes?
There's really only 2 issues. Without question the top issue will be balancing the need for services with the goal of a zero tax increase ! The public by far and large do not want service cuts. Council does not want service cuts. But everyone wants a zero tax increase.
Carving $16 million of budget reductions to cover the entire budget without impacting services from basically only 1/3 of the base will be the toughest challenge.
Secondly, I would also add, that there are a number of new funding pressures and requests for enhanced funding that have been referred to the 2012 Budget process. These have not been included in the current 2% projected tax increase and include requests to deal with forestry and tree trimming, road maintenance, land ambulance services, addiction support initiatives, transit for the disabled, etc.. Accommodating these requests for new or additional funding will be extremely challenging.
Thanks Rob for these responses and for engaging with Hamiltonians via The Hamiltonian!
Last year, I attended more than a resident's share of Council meetings. All were eye-opening, most were spirit-dampening, few moments encouraged me.
ReplyDeleteBut Mr. Rossini's contributions time-and-again were not only refreshing, they provided invaluable insight, and further, they often ended up being the most salient aspects of the proceedings.
Hats off to our 'Finance Chief' for being such a stalwart reference point at 71 Main Street West. (Oh, and he seems like a genuinely good egg, too.)
I'm going to pile on with mystoneycreek. Rob Rossini does the best job of communicating complex financial information I have ever seen, and I have seen many. Like mystoneycreek, I've been at many Council meetings to hear his presentations, and I always marvel at how calmly and clearly he handles questions from Council, always taking the time to explain the details. He's a pro.
ReplyDeleteKudos to The Hamiltonian and to Robert for bringing these facts to the attention of the readers. I doubt that most people know how little latitude the city has over the budget. This is great information to have.
ReplyDeleteEmerg Services such as Police, are subject to the risk we want to take. So, there is also latitude there; or, there was.
The discretionary piece, will probably be contaminated by the political agenda. Ward healing is alive and well. It would be better to make those decisions based on business sense and not political stick work.
Sorce
The "Mandated Services" explanation is the biggest cop out that keeps being repeated by both staff and councillors.
ReplyDeleteYes, the province mandates the service, but does not mandate the cost. The challenge is for the service to be operated at the lowest possible cost and it is this challenge that the City woefully does not even attempt to meet. Surely there is more than one way to deliver a mandated service?