All of the data and graphs above, including the established trends and projections can be easily reproduced and verified from the city’s audited financial statements. They present a factual historical record of how past Councils allowed expenses to grow over the years and how Council’s decisions resulted in a pattern of steadily increasing taxes. While the previous section of this paper presented the facts, this section will offer some analysis and suggestions which will include opinions of the author. The ideas and suggestions offered are not intended to represent the only way ahead, but rather are designed to stimulate community discussion aimed at developing solutions that are inclusive of the vast diversity of opinions within our community.
Often when people are presented with constructive criticism of their work, aimed at promoting growth and development, they have a tendency to “shoot the messenger”. In this case I fully expect some attempt to discredit the author. In my defence, I do have some budgeting and financial management experience. Prior to retirement I held the position of Vice President of Finance and Administration of a college and was responsible for an 85 million dollar budget. I also focused my graduate project for my MBA thesis on examining inefficiencies in municipal governments. A short summary of my background is attached at the end of this discussion paper.One Dimension of Problem
How the Data Defines the Historical Problem
Based on the data, the problem is Not that higher levels of governments are shrinking their financial support to our municipality. Although this is true, its overall impact is not the main driving force. The real source of the problem is that over the last ten years Expenses have been allowed to grow at a rate that was well beyond CPI as shown in the charts above. Overall the total growth of all expenses during the past ten years suggests that Council's financial oversight has not been effective.
The fact that most expenses have been allowed to grow at an unsustainable rate, raises a number of questions that deserve serious consideration by all members of Council. For example:
· Does the city have effective Cost control measures in place to ensure that all expenditures are essential for maintaining the Service in question and at the level directed by Council?
· Does Council systematically review services to ensure that they both remain relevant to the community and that the level usage by residents warrants their continued financial support?
· Is the city accurately measuring service demand and accurately calculating the real cost-per-user by including all secondary costs such as staff services, HR, Finance etc.?