ST. JOHN'S, N.L. — The City of St. John's approved its 2020 budget with no tax increases and some new spending.
The balanced budget for Year 2 of a three-year budget plan came in at almost $305.6 million, up by almost 0.3 per cent compared to 2019. The residential and commercial mill rates remain unchanged at 7.7 and 26.1, respectively.
Coun. Dave Lane, chairman of the finance committee, told reporters it did not always look like things would work out that way.
"The challenge we had is that originally we had projected a mill rate increase," Lane said Monday after council unanimously approved the budget. "We spent this year looking for savings and adjustments in the budget so that we could maintain mill rates for both residential and commercial, as well as the water tax."
"We spent this year looking for savings and adjustments in the budget so that we could maintain mill rates for both residential and commercial, as well as the water tax."
— City of St. John's (@CityofStJohns) December 2, 2019
The biggest increase in expenditures comes courtesy of the city's support of St. John's Sports and Entertainment (SJSE). The subsidy the city pays to that organization is going up by $1 million, to a total of more than $4.4 million. SJSE operates Mile One Centre and the St. John's Convention Centre.
Lane cited fewer performers touring, a weak Canadian dollar and a downturn in conference business as factors negatively affecting SJSE revenue. He said the new 10-year lease agreement with Mile One tenants the St. John's Edge and Newfoundland Growlers and a need to invest in sales and marketing at the Convention Centre made the $1-million increase necessary.
"The past two or three years, we've seen a lot of change in activity with (SJSE)," Lane said. "We've had negotiations that have been very intense with the two teams. We managed to get a great deal with them. We want to support those partners, because we want to ensure there is activity going on in these significant assets we have as taxpayers."
Lane is hopeful sales and marketing efforts will help increase activity and revenue at the two facilties.
The subsidy increase appeared to be the only contentious issue in the budget. Coun. Hope Jamieson and Coun. Maggie Burton both indicated they look forward to seeing the results of a study gauging how much of an impact SJSE has on the city's downtown economy.
Service changes
One item councillors seemed to be in agreement on were new measures to improve Metrobus service. Beginning on March 2, 2020, children under the age of 12 can ride for free. That day, a pilot service will commence for Galway, which currently has no bus service. And to coincide with the beginning of a new school year next fall, Metrobus will implement Phase 1 of a plan to expand bus service for Routes 1, 2, 3 and 10 starting Sept. 7. The latter measure will require Metrobus to add a bus to its fleet.
"This is all about creating a culture of transit," Lane said. "We're already seeing significant increases in use of our transit systems, so we're investing in that to keep it going."
So far in 2019, ridership on Metrobus is up 9.3 per cent over the previous year, and ridership in 2018 increased by almost 4.2 per cent over 2017. The Metrobus operating grant for 2020 will decrease by 0.6 per cent to $13.8 million in light of an increase in revenue from bus fares, while the grant for GoBus para-transit will increase 11.6 per cent to $4.5 million.
The Metrobus Operating Grant for 2020 totals $18.34M. pic.twitter.com/nCIJZbYJSr
— City of St. John's (@CityofStJohns) December 2, 2019
The city also announced $100,000 dedicated to sustainability. That money will support projects identified by the municipal sustainability officer, a position added in the 2019 budget.
The city revived its $20,000 art procurement program and added $10,000 to the heritage grants program — now valued at $60,000.
Looking ahead to the final year of the three-year budget plan, the city is forecasting an increase in spending for 2021 of 1.2 per cent, for a total of $309.3 million.
Budget 2020 pic.twitter.com/Dq4ia3txJt
— City of St. John's (@CityofStJohns) December 2, 2019
Lane noted that in addition to previously anticipating mill rate increases for 2020, the city had thought the same would apply to 2021. He said finding a way to avoid that scenario for 2020 will help down the road when the time comes to finalize the 2021 budget.
"We spent the full year trying to offset that increase," he said. "We achieved it, and that's going to help us into the next year. In fact, having a three-year budget is what helps us to make those decisions, because we can see things coming with a bit more clarity. We're going to try again for 2021, absolutely, to keep the mill rate where it is."
Twitter: @CBNAndrew
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