MEDIA ADVISORY
2004/05 Proposed Operating and Capital Budget
(Tuesday, April 6, 2004)-- In spite of the huge clean-up costs associated with the spring flooding, Hurricane Juan in the fall, and the record-breaking snowfall this past February, Halifax Regional Municipality will end the fiscal year with a balanced budget, and staff is recommending a reduction in tax rates in the proposed 2004/2005 budget tabled today.
HRM staff recommended to Regional Council that there be a 2.4 per cent decrease in tax rates for this fiscal year. This is the largest rate decrease in the past five years. However, they were quick to point out that not all property taxpayers will see a decrease in their tax bills, due to increased assessments
Mayor Peter Kelly said "It was difficult working our way through various weather disasters, but in the end, we expect to end the fiscal year with a balanced Budget and we will continue to pay down our overall debt. Thanks to Council's guidance and to the commitment of HRM employees, we ended a very difficult year in the black."
In a budget address to Regional Council, Chief Administrative Officer George McLellan said HRM's goal is to become the best managed, most livable community in Canada. The proposed budget brought down today moves the municipality towards that goal, while at the same time ensuring it lives within its means and deals with the fiscal challenges it faces.
Mr. McLellan said HRM derives 70% of its revenue from property taxes, which is the highest ratio of any municipality in North America. As a result, HRM property owners are paying a disproportionate share of the municipality's operating and capital expenses, because HRM has few other means to generate new revenues.
The proposed Operating Budget of $547.5 million represents an increase of $18.2 million or 3.5 per cent above the 2003/2004 budget. About $11 million of the increase is to cover such things as collective agreements, regulatory requirements, inflation and increased demands for service due to new growth. The remaining $7.2 million will go towards a $3.5 million increase in provincial education costs; $1.7 million in operating costs for new facilities; $1.3 million towards debt charges; and a further $900,000 for increased insurance premiums.
The proposed Capital Budget for the new fiscal year is $137.7 million. HRM has the bulk of those funds available, but the municipality will borrow $35.5 million. This amount is within the guidelines of HRM's Multi-Year Financial Strategy.
The average increase in residential assessment this year is 5.25 per cent. Just over 30 per cent of residential property assessments increased by only 2.4 per cent or less. That means these taxpayers will see a drop in their tax bills. About 60 per cent saw assessment increases of between 2.4 per cent and 10 per cent, so their tax bills will see a modest increase. Only about 12 per cent of residential properties increased by more than 10 per cent.
"We are not saying that the proposed cut in the tax rate will mean a drop in everyone's tax bill. What we are saying is that it will help shield some taxpayers, and lessen the impact for many others, as a result of the increased assessments, " the CAO said.
HRM began the new fiscal year with ongoing costs associated with the damages from Hurricane Juan, and an unexpected loss of $5 million in revenue when the Province of Nova Scotia lowered the assessment of a major commercial property located in the municipality.
Mayor Kelly said "Despite all we faced, HRM will continue to reduce its overall debt load by another $7.8 million in 2004/05. For the first time since amalgamation, HRM's debt is below $300 million. It was as high as $347.5 million, and now its down below $290 million. In five years, the municipality has lowered its debt by almost 17%, or $58 million."
The Mayor add ed that recent announcement by the Federal government's to rebate its portion of the GST back to municipalities with help HRM reinvest in its infrastructure program. The amount forecast for this year is approximately $3 million.
Regional Council will be holding Budget deliberations in the Council Chambers the week of April 13-16. The review is expected to be completed and ready for Council approved by April 20th.
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George McLellan
Chief Administrative officer
(902) 490-4026
Dale MacLennan
Director, Financial Services
(902) 490-6308
Highlights of the Proposed 2004/2005 Budget
1. Improved and enhanced public transportation, including the introduction of a new Bus Rapid Transit (BRT) service to the downtown core from the communities of Sackville and Cole Harbour.
2. Expanded pollution prevention efforts and enforcement, leading to a cleaner environment. This includes continued progress on the $330 million Harbour Solutions Project
3. Development of a long-term blueprint and action strategy for sustainable environmental practices and the reduction of Greenhouse Gas (GHG) emissions.
4. A new Integrated Dispatch Centre for better coordination of, and faster response times for, public safety and emergency services.
5. A fully-integrated voice communications system for police, fire, and emergency services
6. A Strategic Growth Fund to leverage additional funding from the federal and provincial governments to enable HRM to undertake new infrastructure projects, particularly those related to a new Regional Plan.
7. Construction of a new all-weather sports field in Dartmouth.
8. A new Regional Transportation Authority for the overall improvement and future planning of the region's transportation network, including all modes of transportation.
9. Hire 8 new firefighters and re-open paton Road fire station in Sackville
John O'Brien
Corporate Communications Officer
(902) 490-6531
(902) 490-4044 (fax)
e-mail www.obrienj@region.halifax.ns.ca
