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Calgary's $86 Million Easter Egg
Wednesday, 16 March 2016 - 1:45pm
Tuesday’s Priorities and Finance Committee meeting at City Hall gave Calgary taxpayers a look into the crystal ball in terms of the imminent debate over what to do with the City’s surprise $86 million surplus - a nice ‘Easter egg’ if ever there was one.
If you’re looking for a good summary of the council discussion on the matter, I recommend reading Bill Kauffman’s (Calgary Herald) overview. Here’s my take on the situation.
During the debate, Mayor Nenshi aptly commented on the “unbelievable financial strength” of the City. “Unbelievable” is the perfect term to use. Recall that last December Calgarians were pleasantly surprised to learn the city had a $30 million surplus. To now learn the surplus is more than double that figure is good news to say the least.
Just think that a year ago, when crafting the budget, some councillors were lambasted for suggesting cuts as the budget was considered to be as lean as it possibly could be. I wrote about this in a previous column.
It is encouraging that Calgary’s administrators are able to find so many efficiencies in the City’s business units. Relative to other levels of government our financial situation is orders of magnitude better. However, there is still a lingering sense that Calgarians are not fully at the table in the conversation about the use of their tax dollars.
For instance, at the finance committee meeting, the Mayor returned to his familiar role of professor and lectured the committee and audience on the options when faced with an operating surplus.
He presented four options – elaborating on the merits of one time spending, a one time rebate to taxpayers, and putting the money in a rainy day fund... but, conspicuously, the fourth option of a permanent reduction in taxes was quickly rebuked.
As Mayor Nenshi cautioned earlier in the presentation, if the City is outperforming a particular benchmark – that benchmark needs to be modified so that Calgary can constantly be chasing more ambitious targets. That sounds like a strong case for delivering meaningful tax reductions when the City’s financial situation is “unbelievable.”
Finally, I would note that the city’s budget update states, “balancing the demand for quality City services with affordable taxes has been a challenge.” Yet, the 2015 Citizen Satisfaction Survey showed Calgarians are currently satisfied with the level and quality of services and programs. Doesn’t that suggest it’s time to focus on the other side of the equation - tax reductions? Perhaps it’s time to give the Easter egg back to taxpayers.
John Whittaker is a policy analyst with the Manning Centre