Thursday, April 13, 2017

City Council Timeline: Special Session, Tuesday, April 11, 2017

City Council once again managed to keep the clock under forty minutes, with fast paced Special Council Session Tuesday that for the most part laid the path towards a mill rate increase for this July.

The Agenda for Tuesday had but one item, a review of the latest math from the City's Financial Officer, as Corinne Bomben outlined the latest financial forecast, one that made much use of the weather forecast from February and March to make the case to increase the mill rate increase to 2.5 percent.

A request that for the majority of council members was just a bit too much for them to follow through on.

The budget discussion took up 29 minutes of the thirty nine minute meeting, with Council using the final ten minutes to address items related to Canada 150 grants, the provincial election and what the candidates have to say about Prince Rupert issues as well as a short synopsis on the prospect of a propane shipment terminal at Watson Island.

Further information from our overview and placement in the video archive can be found below, with the permanent record of the minutes added as they are posted to the city website.

In attendance April 12, 2017

Mayor Lee Brain-- Present 
Councillor Barry Cunningham-- Present  
Councillor Blair Mirau -- Absent
Councillor Wade Niesh -- Present
Councillor Nelson Kinney --  Present  (participated by phone)
Councillor Gurvinder Randhawa--  Present 
Councillor Joy Thorkelson -- Present 

Video Archive for April 12, 2017



( 0:00 -- 0:30 ) Special Regular Session of Council -- The Mayor reviewed the list of minutes and agenda items to be noted by Council members, with Council then approving the Agenda while the past minutes of previous council meetings were adopted.

(0:30 -- 31:30) Report from the Chief Financial Officer on the Budget Recommendation  -- The City's CFO, Corinne Bomben provided the final overview of the city's Budget preparations, providing her revised financial plan for Council's review which included a recommendation to increase the proposed mill rate to 2.25% from the previously considered rate of 1.5%.

She outlined the two factors that had contributed to that recommendation, with a decrease in the assessment values of five million dollars, primarily at the residential level and the increased requirements for the city in dealing with the snow of February and March.

Ms. Bomben suggested that the City will need to increase the budget by 100,000 dollars to plan for the end of the year winter maintenance.

She then relayed some of the concerns that the city should consider when it comes to providing for winter maintenance for the roads to the end of the calendar year.

Noting for the Council members that should the City not be able to provide the budget for the road maintenance, the city runs the risk of not having the adequate resources to keep the roads safe through the end of the year and how any accidents that are attributed to inadequate maintenance would see insurance premiums rise, in which case taxes would increase to cover, adding that the financial downside is that taxpayer dollars leaving the community indefinitely.

With that the CFO provided for her final recommendation of a 2.25% mill rate for 2017, a .075% increase from that proposed earlier this Spring.

Following her overview Council members offered up their thoughts on the request, with Mayor Lee Brain opening the discussion by making note of the request to change the mill rate, reminding residents that the city did not have a mill rate increase last year and how neighbouring communities have similar issues when it comes to need more revenue.

He also pointed to such local challenges as the ongoing issue of taxation caps from the province and the Port Edward revenue sharing agreement which he suggested provides an additional hardship on the city.

He noted how the city is in a bit of a transition period, calling attention to the announcement of the day of a letter of intent with Pembina pipeline for a potential development on Watson Island, as well as the AltaGas project on Ridley Island which both could bring in new revenue for the city.

Calling it an interesting time of transition, he noted how the city needs to balance  the tax situation, that for the immediate period the city may have to increase the residential and business taxes, while acknowledging that those two categories are significantly higher than other levels.

Councillor Niesh noted how he would prefer not to have a tax increase and then observed as to his disappointment in the lack of engagement by the public during the course of the budget process, noting how people will have input in coffee shops, Facebook and everywhere else, but when it comes to a budget consultation session only one or two people show up.

He acknowledged that he had in the past, prior to his election to Council he had called for the city not to raise taxes, but with two years on council he now understands better the need for revenue requirements.

As for the tax increase, he recommended that the City return to the 1.5 per cent recommendation and deal with any winter conditions later in the fall. He also expressed his hope that the project announced today would do good things for the city next year.

Councillor Cunningham concurred with that recommendation, noting that he wasn't too happy with the way that the 2.25% increase was introduced, adding that the city is looking at a tax increase in the future with expenditures that might come up or might not come. Like Councillor Niesh, Mr. Cunningham also offered up his hope that the new project will move forward and the city won't have to worry about nitpicking over little things anymore.

He also called attention to the high rate of taxes in place now and the struggles that local businesses are facing and that it's time to hold the line as best they can and deal with things as they come up.

Councillor Thorkelson had a number of questions related to the snow removal issue, inquiring if the city had a surplus from the previous year for snow removal use. Ms. Bomben outlined some of the different elements that the city had to consider as part of the roads budget on snow related issues.

The Councillor then explored some of the budget issues related to reserves, surpluses and past financial transactions, asking how they might relate to the normal budget for snow removal is and what the projected cost of November and December might be.

From those observations Councillor Thorkelson suggested that the City should gamble that there will be the required 100,000 for snow removal available from surplus at the end of the year and that it could be used should the need arise.

She also noted for Council that she was the only council member that had advocated for a tax increase last year, pointing to this exact situation as to her concern at how the city approached their budget issues last year.

She also offered up the concept of splitting the difference on the tax increase, recommending a mill rate of 1.75% to address some of the issues.

She then noted that there is a need in her opinion for the City to budget  for a tax increase every year and if they don't need it, to put it into reserves for future use.

Mayor Brain offered up an alternative philosophy suggesting that the city needs to figure out another way to significantly increase their revenues, once again noting the opportunity that the Watson Island announcement might provide for.

He also stated that the City needs to take a look at the city's strategy on the Port cap issue and the Port Ed Revenue sharing agreement, stating that with the latter the city really could not afford that financial outflow. Adding that if those elements are dealt with and the Watson Island prospects work out, then the city could have a different type of discussion at budget time.

Councillor Kinney echoed the comments of council, noting that he was not in favour of the proposed increase to 2.25%, holding the line at 1.5 per cent.

Councillor Randhawa's comments noted that the city's residents already have a large tax burden in place, calling attention to the increase in utility fees and recreation fees that the city has already put in place. He also noted the burden it places on people on fixed incomes, with that he called for no tax increase for this year.

The Mayor noted that the option of no tax increase would mean the need for service cuts, adding that the city can't balance the budget without the 1.5 per cent increase, noting that the city has $160,000 dollars in obligations this year, including contract obligations to the union to take care of.

With all of the council members in attendance heard on the issue, (Councillor Mirau was absent on the evening) Council voted to accept the recommended proposal of a 1.5% model for the increase to the mill rate.

 (29:00  -- 38:00  ) Reports, Questions and Inquires from Council

Councillor Cunningham raised concerns over how the Canada 150 grants were handed out, noting that while there were six or seven local groups that had applied, none of the grants were approved for Prince Rupert, while a number of surrounding communities were provided with grant funding. Mr. Cunningham called for staff to write a letter to inquire how that process worked and why Prince Rupert was not included in the grant opportunities.

Mayor Brain echoed those concerns, advising that he too had just heard of the situation and would address the issue himself and write the required correspondence to inquire further about how those decisions were made, noting that Terrace had received four grants as part of the application process.

The Mayor then took note of the upcoming provincial election and suggested that Council could write a list of questions for the candidates to answer, to hear what the candidates for the Legislature have to say about local issues.

Councillor Cunningham called it a great idea adding that he would like to see the candidates asked direct questions related to city issues, suggesting that they be invited to a Committee of the Whole session to provide their responses.

Councillor Kinney outlined that he wasn't inclined to have them address the topic in person, but that the city could provide them with written questions to be answered.

The Mayor noted that council could publish the results on social media, a place that he suggested people exist these days, he outlined an approach that would see the city council members formulate the questions and then send them out to the candidates.

Councillor Thorkelson echoed the support for the concept, outlining a number of areas where she thought the city could direct its line of questions toward. Using the example of Flora Bank noting how in her opinion that industrial decision that tore apart  the community, highlighting that as an example of the kind of questions that the city should put towards the candidates.

To close off the special session, the Mayor provided a short synopsis of the announcement from earlier in the day that Pembina Pipelines may construct a propane export terminal on Watson Island.

Recounting the work on decommissioning of the site and the transfer of land to Legacy Inc to help facilitate commercial opportunities and from that transfer, Legacy had signed a letter of intent to enter into lease with Pembina for a portion of Watson Island.

He outlined how the company is currently exploring the possibility of their proposed propane export terminal for that portion of Watson Island, with the company now conducting assessments and technical studies.

Should the board at Pembina make a final investment decision, then a lease will be executed with Prince Rupert Legacy Inc. for a certain period of time and provide for an anchor tenant for the Watson Site.

Calling the Pembina interest the beginning of Good News for the community, Mayor Brain observed as to how the city has been working hard to ensure that the community prospers in the future.

He offered up a sketch of what Pembina is all about, comparing their North coast project as a smaller version of the Alta Gas proposal for Ridley Island.  He noted that the Pembina plan for Prince Rupert is to bring propane into Watson Island by rail, with no processing of the propane to take place.

Mayor Brain also outlined that Pembina would soon be coming to Prince Rupert, to host community presentations, as well as to meet with the community and area First Nations, adding that the city is looking forward to having them here.

And with those contributions complete, the evening's session came to a close.

As always, our Council Timeline is only a reflection of our observations from the Council session of the night. Be sure to consult with the official minutes from the City, when posted to their website for further review.

More notes related to Tuesday's Special Council session can be found on our Budget Archive page and from our Council Discussion Archive.

In addition to the city's official minutes, the City's Video archive provides a helpful record of the events from each public council session.

Official Minutes of the Regular Council Session from April 12, 2017 (not available yet)

The next regularly scheduled Council session, takes place on April 24th.

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