It’s Time to Change the Way City Hall Writes Its Budgets. Here’s How.

Money on Trees


Note: This article was originally published in The Overcast.

This year’s budget has been a big, thorny issue, and as a councillor I’ve been struggling with how, exactly, to respond to it. In December, City Council announced its next three-year budget and much of the information (tax hikes and service cuts) was totally unexpected by the citizens of St. John’s.

The process, in the final weeks, clearly wasn’t good enough, and this lack of communication and consultation was my main reason for voting against the budget; I couldn’t feel confident in the decisions without public feedback.

The fallout has been heavy and justified. Big tax hikes will hurt local businesses, and various cuts have the potential to stymie our economy during a slowdown on all levels.

I feel deeply for the residents and business owners who are shocked and concerned about what these changes will mean to their livelihoods. I’ve had had many sleepless nights grappling with how I can use my role on Council to help soften the blow.

One option I’ve seriously considered is to loudly call on my colleagues to rescind the budget and rethink the mill rates and cuts. But that’s actually a huge project with significant implications, which if even possible would not just take months to undertake; it would also be extremely challenging and could do a lot of damage; fracturing the working relationships of Council, managers, unionized staff, and residents.

Because of this, the approach I’m taking is the one that is more in line with my principles and the one I campaigned on. It’s about bringing groups together to talk rationally and openly about the problems we face and the possible solutions we can pursue.

“I’m Advocating for a Change in How We Do Things at City Hall …”

First off, it’s important to say that I’m very proud of our progress to-date on our Engagement Framework. Staff at all levels have been given training in public-participation principles, and we have begun integrating engagement requirements into decision making.

As well, Council announced on February 1st a robust, two-year “departmental review and reporting process” that will not only be a deep dive into how we do things at City Hall, but will lead to a change in how we develop our budget.

This is an excellent move, because not only will we have a mandate to find new ways of doing things in all departments, Council will also be given more frequent and regular updates throughout the year regarding how our tax dollars are being used and how we should prepare for the months and years ahead.

So, the process of change is already underway, but it needs to speed up and be more focused and intentional. And, very importantly, we have to shift our thinking about how the budget influences the local economy.

Budget Focussed More on Running City Hall Than Developing Local Economy …

What do I mean by that?

One striking characteristic of our current three-year budget is that it is very “inward focused.” Many of the big decisions made were about the financial operations of what I like to call “City Hall Inc.”

One of the largest expense increases has been salaries. The justification for this is actually pretty impressive: It is the price paid to solve one of the most frustrating and damaging dilemmas faced by governments throughout the western world.

In 2014, the City made a deal with our unions involving a move from “defined benefit” pensions (that is, retirees receiving taxpayer-funded income for the rest of their lives) to “defined contribution.” It required a big salary increase to convince them to agree, but removes the burden of the taxpayer to fund the pension plan for all new hires. Suffice it to say, the City of St. John’s has actually solved a massive long-term challenge.

But this change, along with some hefty retirement packages to reduce salary expenses in the medium-term, are wholly related to managing the finances of an organization, and nothing to do with spurring and developing our economy.

And therein lies the debate: What is City Hall’s role in economic development? Many say we should focus only on “core services” — that nebulous set of things the City does, like fill potholes and clear snow.

I feel very strongly that we have to go further than this. The City already plays a massive role in influencing the economy (tax regimes and permit processes can make or break a business, for example). So, it is incumbent on us to shape our spending in a way that positively drives the economy.

This isn’t that difficult, actually. But it does require a fundamental shift in how we operate.

Placemaking is the New Economy Builder ….

Cities the world over are realizing that when you invest in place — that is, by creating a city that is a wonderful place to be — you actually strengthen the economy.

There is a great article from the Project for Public Spaces (PPS) website called “How Your Community Can Thrive — Even in Tough Times” which I feel sums up this view perfectly:

“Cities and regions that thrive in the 21st century will be differentiated by their lively neighborhoods and business districts, cultural and recreational attractions, great sense of place, protected natural areas, and deep pride in local character, products, and foods. They will achieve this through an open collaborative process with their citizens.”

This view hinges on a concept called “placemaking,” which is an economic development concept that has been proven most effective in our new service, and experience-based economy (think digital marketing firms and tourism operators).

The author goes on to say something what I think should cause us to seriously consider how we’ve crafted our budget and spur us into action to change the way we think:

“In a down economy, it is tempting to cut back on these planning ideas, thinking that they are frivolous. But disregarding these principles in the name of saving money can create a downward spiral that causes a local economy to lose its competitive edge.”

That’s pretty scary given our recent budget, but it’s not all doom and gloom. The article states that due to this economic reality, PPS’s goal “is to empower citizens, elected officials, communities and professionals to use Placemaking in their planning, design, and operation of public streets and transit facilities.”

That’s what I want for St. John’s, and we have a lot to work with.

We’ve made some significant decisions that ensure City Hall can operate in a fiscally sustainable way. Now that we’ve accomplished that, it’s time for us to focus on what matters to the people of St. John’s: healthy, happy, vibrant public spaces and amenities that stimulate connections, new ideas and brilliant cultural experiences.

Will you join me?

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Written by Dave Lane at 15:00
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