During our finance committee meeting on February 19, Councillors approved Staff recommendations to allocate $13.7 million (M) in surpluses from 2013 into various reserves, including: $0.75M to Contingency Reserve; $0.75M to Niagara Regional Housing to mitigate a Federal funding loss; $0.85M to top-up Social Assistance Reserve; $3.9M to fund future waste management capital projects; $1.0M to Improvement Initiative Reserve (for cost saving measures); and $3.3M to Taxpayer Relief Reserve.
The $3.3M to the Taxpayer Relief Reserve was to “…be used in the operating budget" to provide a buffer against tax increases over the next four years. The reserve would allow future Councils to increase overall spending greater than increases in property taxes.
While one Councillor (Petrowski) suggested that some of the surplus be "given back to taxpayers" in 2014, he didn't try to amend the recommendations during our Committee meeting.
Upon reflection, his comments resonated with me as the Region's Budget Chair.
Why hold on to $3.3M of people’s money now when we are to "give it back" in 2015-18 anyway?
Having just had a visit from the credit rating service, we knew that the Region’s reserves are in good shape.
We are also expecting significant operational savings as we implement a new financial management system, reorganize the Region, and identify additional efficiencies.
In addition, not taxing residents and businesses $3.3M in 2014 would “hold our feet to the fire”; it would remove the temptation of spending the funds on non-priority initiatives and force us to justify any future tax increases.
So, at the February 27 Regional Council meeting, Councillor Heit and I tried to amend the motion and to use the $3.3M to reduce the 2014 Regional tax increase.
What happened? We debated our amendment for two-hours; some Councillors favoured the proposal, a few suggested we keep half, and some wanted to hold on to it all.
Then, immediately after Council voted to "call" the vote on our amendment, Staff said that we couldn’t because it would be a “reconsideration” of our Surplus / Deficit Policy.
Undaunted, I argued that the Surplus / Deficit Policy is administrative because it “…applies to all regional departments” and not to Regional Council. Further, the policy outlines the clear role of Staff (to recommend) and of Council (to approve/disapprove).
In the end, the majority of Council voted that the amendment was a “reconsideration” of the policy, required a week’s notice and two-third’s of Council to even contemplate!
That's how the straightforward idea of giving people tax relief now got stuck in the machinations of your Regional government.
