Nelson city council’s 2020 budget will contain a zero per cent tax increase.
Finance manager Colin McClure had already worked up a budget with a two per cent increase, but then had to change it, typical of many government decisions in the days of COVID-19.
“Things are happening fast these days,” McClure told the Star. “On March 13 council agreed to my two per cent budget, then within five days council said, ‘No, we need a zero per cent tax increase, let’s figure it out and move forward.’”
The two per cent increase was needed mostly to cover inflation and wage increases mandated by collective agreements, McClure said.
The new version of the budget has not yet been finalized.
A two per cent increase to the city budget would have brought in about $190,000. This amount will instead be obtained by dipping into reserve accounts, McClure said.
The city contributes each year to a number reserve accounts that are held for specific purposes or projects, or for emergencies.
Council will also review the draft budget to determine if some projects or expenditures can be delayed, and if there are some planned expenditures that will not be needed at all this year because of COVID-19.
For example, funding for councillors to go to the annual Federation of Canadian Municipalities conference will not be needed because of the cancellation of that event.
Council recently asked the Regional District of Central Kootenay to create a zero per cent increase as well. In addition to city taxes, Nelson residents pay taxes directly to the RDCK for regional services that city residents use.
The RDCK did not get all the way to zero but has reduced its planned tax increase to approximately five per cent on average, depending on location in the region.
Other city budget initiatives will be aimed at easing the burden on residents hit by the pandemic economy.
McClure said priority will be given in the coming year to continuing with projects that will employ local businesses or can attract grants.
“For example, we put in a bike infrastructure grant,” McClure said, “and if we were to get that, we could hire local people to do that work. And we have a grant from the Columbia Basin Trust to re-do the pier at the end of Hall Street.”
Management staff will review all of the city’s fees, charges, and penalties and look at ways of waiving or deferring them.
McClure gave the example of a missed hydro payment.
“If you lost your job, we want to keep the power on, maybe with a payment plan, smooth out your plan, try to work with you.”
The city’s usual annual public meeting about the proposed budget will be online this year because of COVID-19, McClure said, but the date has still to be announced.