Today, administration officially handed over the proposed multi-year operating and capital budgets as well as the two year operating and 10 year capital plans to Council. These budgets and plans are built based on the preliminary direction given by Council last June.
“When Council set preliminary guidelines for city budgeting this year, we weighed an array of factors including, but not limited to, COVID-19, provincial climate and local economic impacts,” said Mayor Tara Veer. “Both City Council and administration recognize the need to keep taxation and other fees as low as possible for our citizens and local businesses. With this in mind, administration was given the difficult task to ensure property taxes do not increase in both 2021 and 2022.”
Council gave administration the following financial parameters:
- 0% tax increase for 2021 and 2022
- 0.5% capital contribution in the 2021 and 2022 Operating Budgets
- No more than a 0.5% increase in utility rates for 2021 and 2022
- No increases in user fees or new fees in the 2021-2022 budgets
- Reserves (excluding offsite reserves) will be in a positive balance
- The 2021-2022 capital budgets meet the approved Council Policy which limits debt to 75 per cent of the provincial debt limit
“Developing an annual budget and long-term financial plans is difficult any year, this year proved to be exceptional due to the financial challenges stemming from the economic slowdown coupled with COVID-19. We were, however, able to meet all of Council’s guidelines while still maintaining the programs and services Red Deerians have come to expect,” said Allan Seabrooke, City Manager. “In order to meet these guidelines, we had to make some difficult decisions over the past several months, including staff reductions and organizational restructuring.”
The organizational restructuring helped to reduce the proposed 2021 operating budget by $11 million. The proposed 2021 operating budget totals $379.5 million and the 2022 operating budget being proposed totals $384.9 million. The approved operating budget for 2020 was $390.8 million.
On the capital side, the proposed 2021 and 2022 capital budgets total $219.2 million and $97.5 million respectively. The capital budgets and 2023-2030 Capital Plan are a combination of annual maintenance programs, current facility enhancements and necessary upgrades to infrastructure.
In order to reduce the 2021-2029 capital plan approved in principle last year, a number of projects were moved later in the plan, or removed altogether to reduce capital spending.
“We worked alongside our organization to find ways to reduce our capital spending long term in an effort to meet Council budget direction and corporate financing while taking the current and anticipated future financial environment into consideration,” said Dean Krejci, Chief Financial Officer. “The 2021 budget is in line with previous plans, but you’ll notice a large decrease in our proposed capital budget come 2022.”
Council will deliberate the 2021-2022 operating and capital budgets, 2023-2024 Operating Plan and 2023-2030 Capital Plan from November 30 to December 4, 2020. This is the first time administration has put forward multi-year budgets.
“Having multi-year budgets allows us to plan more effectively long-term and also reduces the time required for planning and approvals. The second year of a multi-year budget shifts to more of a review while having the opportunity to respond to external influences and adjust the already approved budgets,” said Seabrooke.
Residents are encouraged to review the budgets and plans online and provide feedback through the guided online survey this year. Visit www.reddeer.ca/budget for all the details and see attached Q&A Backgrounder (pdf) for more information.
For more information, please contact: