First budget cuts achieved
After a day-and-a-half of deliberations, the City of Saskatoon has made its first budget cuts. Councilor Randy Donauer brought forward a motion for a 3 per cent reduction of contributions to capital reserves impacting the mill rate, excluding the fire and roadways preservation reserves.
If the roadways and fire reserves were included, the City would achieve savings of $2.6 million. Without their inclusion, roughly $1.4 million will be salvaged.
Certain affected reserves have been previously noted as underfunded, and several councilors stated that it would be dangerous to remove the City’s financial contribution. Councilor Mairin Loewen says the Civic Building Comp Maintenance reserve would take a toll.
“We just had a report earlier this year signaling that we actually have to up our reserve in order to keep our assets in line,” she stated.
Although many councilors disagreed with the motion, Councilor Troy Davies thought the reductions should be even higher.
“I actually think it should be 4 per cent. That’s where my head’s at. Again, we just finished a full debate on how we heard residents can’t afford the tax space that we’re currently at. I think we have to make some bold moves here to get the ball rolling, cause it’s not rolling at all at this point.”
The motion to implement 3 per cent reductions was carried by a close vote of 6-5.
Saskatoon City Council also approved another reduction of $200,000 to reduce billboard locations and reduce land maintenance expenditures. Council also saved $210,000 in the Utilities department. All cuts considered, the City has saved about $1.8 million far, translating to just over a 0.5% decrease in the proposed property tax.
Moving more taxation to business from residential
Saskatoon’s City Manager says residents are carrying a disproportionate amount of property taxes. Jeff Jorgenson presented the Business Property Tax report to City Council on day two of budget deliberations.
He says in Saskatoon, businesses carry 33 per cent of the tax load, while residents carry 67 per cent. Councillor Mairin Loewen proposed a motion to shift the ratio, decreasing residential property taxes by 2.01% and raising business taxes by 4.23%.
Although slanted, Councilor Randy Donauer says evening the scales would be dangerous, not beneficial.
“The part that makes me the most nervous about this, is we are catching everybody of guard. No body is on the speakers list for this. No body. Not the Chamber, not the NSBA, and if we were to telegraph that we were doing this, this place would be rocking today, and it would be full of business owners,” Donauer declared.
The motion was voted down 9-2, with ‘dangerous’ and ‘reckless’ being some of the words used to describe it. Councilor Troy Davies says the fact that the motion was on the floor is concerning.
“Asking a business to all of a sudden jump up in taxes like this with no heads up, with no pre-planning…with someone who owned a small business with ten staff, this right here would shut the doors and I would have had nine staff unemployed,” Davies announced.
All but two councilors disagreed with switching the scales without much data or community feedback. In addition to Loewen, Councilor Gough says it’s worth looking into.
The second and third parts of Loewen’s motion were unanimously approved, which ask for both a report on a new business taxation sub-class, and a report on business tax ratios and their impact on economic factors.
The budget and Saskatoon event venues
City Council also received budget reports from representatives of the city’s three main Arts, Culture, and Event centres. SaskTel centre and Remai Modern Art Gallery presented Tuesday evening, leaving TCU Place to kick the day off.
TCU Place is not increasing their ask from the City of Saskatoon. Lisa Mulvaney with TCU says their 2024 projected revenue is just over $12.8 million.
“That’s an aggressive target. The rest of the industry across the nation is decreasing their revenue. They are expecting with inflation that we are dropping our revenue. We feel like we’ve still got room to move,” Mulvaney stated.
She says their expense target is also aggressive, but after further inspection they were able to save an additional $200,000 to ensure a breakeven budget and a surplus of $122.
Tuesday, Council passed Remai Modern’s ask for 3% increase in city funding for 2024 and 2.5% in 2025.
