Delta council approved a revised budget Monday afternoon that aims to save the city, and residents, some cash during the economic turmoil caused by the COVID-19 pandemic.
The revised 2020 financial plan includes a decrease in the city’s planned property tax increase, from 3.5 per cent to 1.75 per cent. The 1.75 per cent increase works out to an additional $42.50 for a “typical” Delta home (assessed at $887,000), and $48 for $1-million home.
According to a staff report to council, the new 1.75 per cent property tax rate increase is one of the lowest in Metro Vancouver, with only one other municipality that has a planned increase below two per cent.
The report states the revised rate will provide some financial relief to residents and businesses while still providing sufficient funding for base city service levels.
In advance of preparing the budget, the city took several steps to decrease costs and address concerns about cash flow as a result of the COVID-19 pandemic, including freezing discretionary spending, laying off approximately 540 auxiliary and temporary staff, putting a hold on new staff hires unless essential, redeploying existing staff to support critical services, prioritizing and delaying budgeted capital spending, reducing staff overtime and freezing equipment purchases unless deemed essential.
Nonetheless, the city has had to decrease its 2020 budget by about $13.3 million.
According to the report, approximately $5 million of that decrease is in lost revenue is from parks and recreation admissions, programs, rentals and other fees, though the loss if mainly offset by operational savings, while about $2.6 million is from the city deferring its planned 1.75 per cent increase to property taxes to pay for parks, recreation and culture sustainable infrastructure, meaning several projects will have to be put off to future years.
The city is also budgeting for about $2 million less in investment income for 2020, as well as $1.7 million in reduced development revenues, caused by the current pandemic-related financial crisis.
To cover that combined $3.7 million, the city is reducing the amount of taxes it will use to pay for capital projects. As a result, several projects will be deferred, including planned upgrades to 72nd Avenue and new washrooms at Chalmers Park and Delview Park.
As well, the city is setting aside $2 million not previously budgeted for as a “COVID-19 provision” to cover increased expenditures relating to the pandemic — such as IT solutions for remote work and meetings, additional supplies and cleaning, and personal protective equipment for city staff — as well as “further revenue pressures” and other unforeseen costs due to the pandemic response and recovery efforts. The COVID-19 provision will be paid for using Delta’s reserve funds.
“While I am very disappointed to not be embarking on some of the tremendous projects we had planned for 2020, I know that staff have done everything possible to reduce the tax burden on the community while still providing vital investment in the economy and public safety,” Mayor George Harvie said in a press release. “These steps are necessary to ‘keep the lights on’ while ensuring our no-call-too-small service level for emergency response.
“In addition, this positions us well for the uncertainties of 2021 and beyond while allowing us to lead the local economic recovery. We look forward to undertaking some of the deferred initiatives at a later date, but until then it is important to continue our efforts in limiting the spread of COVID-19 and supporting the community through these difficult times. This budget reflects these new priorities.”
Council previously extended the utility fee penalty deadline from after March 31, 2020 to after June 1, 2020, and staff will be bringing a plan to extend the property tax penalty deadline to council at a later date.