Hoping to catch up with the city’s growth, Halifax councillors are considering adding two dozen staff as their budgeting process for the year ahead continues.
Council’s budget committee met on Wednesday, hearing presentations from Planning and Development director Kelly Denty and chief administrative officer Jacques Dubé.
With the committee’s approval, Denty’s department is getting a 24% budget increase for 2021-2022, planning to spend $16.7 million. That increase includes 13 new positions, including two planners to work on affordable housing initiatives, and six employees to implement the city’s climate change mitigation plan, HalifACT 2050.
Denty also presented the committee with five options over budget — added items for councillors to consider in the budget adjustment list, or parking lot, at the end of their budget-building process, on April 21.
Those items, all added to the list on Wednesday, were: $250,000 for an increase in grant funding for Heritage Conservations District; $241,800 for three new entry-level planners; $227,400 for three new entry-level building officials; $227,400 for three new entry-level compliance officers; and $108,700 for a new senior program engineer position. That’s another 10 positions.
“We’ve always run a lean system, and we can’t expect it to ramp up significantly more when we have this unexpected, unprecedented growth happening,” said Coun. Waye Mason, who moved to add the positions to the budget adjustment list.
“We’re going to need to staff up for that.”
After council approved Denty’s budget and added those items to the list, Dubé presented a Resource Funding Plan. It was a last-minute addition to the budget committee agenda, and Mayor Mike Savage said it was the first even he’d heard of it.
Dubé told councillors that with a growing population, more than 200 reports to be written, and all the strategies approved over the last decade (more than 100) the municipal workforce is having a hard time keeping up.
“We’re a billion dollar organization that has the ambitions of a big city, but we’re only resourced like a mid-size municipality,” Dubé said.
To keep up, Dubé is proposing council add up to 15 new positions at an annual cost of $2.25 million. He and chief financial officer Jane Fraser want to pay for the increase using deed transfer tax — a 1.5% tax levied on the buyer whenever property changes hands.
The revenue from that tax has outpaced expectations for years, with the municipality budgeting conservatively even as the housing market has heated up. The city even reduced the budgeted revenue from deed transfer tax during the pandemic by $10 million.
“At that point, no one could have predicted that the sale of homes and commercial properties would go through the roof during the pandemic, which is exactly what we saw,” Dubé said.
“The market is hot. For 2021, we’re projecting deed transfer tax revenue of close to $60 million. This is a 50% increase over the budget amount. According to a number of economic studies that have been carried out on our behalf and industry pundits, the housing market is not going to slow down any time soon. With that, staff is comfortable revising the estimates for deed transfer tax going forward, not just for this year, but for the four-year fiscal plan.”
Dubé is talking about betting on the housing market staying hot in order to pay for these new positions, with a plan to actually budget for $60 million in deed transfer revenue in the year ahead. But he told councillors the city will still be more conservative in its outlook than a consultant hired to review deed transfer tax two years ago, who recommended budgeting for $80 million.
Savage wasn’t so sure Dubé needed so much more budget, and wanted to look at reducing the $2.25 million, given the positions won’t be filled at the start of the fiscal year. He also wanted more information on how the money would be spent.
“I support the need for this, but think we just can’t totally let go of our responsibility as council,” he said.
Sharing Savage’s concerns, Coun. Paul Russell, chair of the budget committee, stepped down from the virtual chair to move an amendment to the staff motion.
Russell’s amendment asks Dubé to detail the “measures and implications” of the proposal. Savage then proposed to amend that amendment to add the word “accountability” to have Dubé set out a reporting process for the money.
The amended motion to add that $2.25 million to the budget adjustment list passed.
Russell also moved $150,000 to the budget adjustment list for a look at the water quality in First Lake in Lower Sackville. That passed too.
In total, councillors moved seven items totalling $3,455,300 to the budget adjustment list on Wednesday. The grand total now stands at $9,264,050, according to the Examiner’s count. If council decided to move ahead with every item, which includes a few reductions to the budget, and pay for all of them through general revenue, the average residential property tax bill would increase by about $30 on top of the $38 increase already approved in principle. That’s unlikely to happen, and surplus cash from 2020-2021 could help councillors avoid tax increases altogether.
Wednesday’s meeting was the last departmental budget meeting, and the last where councillors could add to the budget adjustment list.
They’ll pick and choose from the list at a meeting on Apr. 21, which effectively finalizes the 2021-2022 budget, leaving council only to rubber stamp it next month.