ABERFOYLE – Puslinch council approved a four per cent cost of living increase for staff in 2022 at its Jan. 13 meeting.
And that changed the frame of discussion for the rest of the meeting as council looked for other places to shave dollars from the draft 2022 budget.
Normally the staffing piece is presented later in the budget process, but treasurer Mary Hasan thought it would be more prudent to bring it up sooner rather than later since council had directed staff in the summer to cap salary increases at 2% and her report recommended a 4% increase.
Mayor James Seeley acknowledged that when staffing is left until the end of the process, that’s often the figure that gets adjusted to reduce the overall tax increase.
“Finding savings should not be on the backs of staff,” he said.
In her report, Hasan suggested it’s a false economy to postpone salary increases. And in the 2021 budget staff took no salary increase in an effort to help taxpayers hard hit by the pandemic.
“As council is aware, when a market review is undertaken to ensure wages are at an appropriate level, if regular incremental adjustments are not made, a significant adjustment will need to be made every four to six years which will have significant budgetary impacts at the time,” Hasan wrote.
The report states the cost-of-living increase calculated by Statistics Canada was 4% in August, 4.4% in September, 4.9% in October and 5% in November 2021.
As well, neighbouring municipalities have approved 4% increases for staff in 2022 and it’s important to remain competitive, states the report.
“Not abiding by policy or varying from an ongoing policy to benefit from lower COLA numbers is problematic and will result in the township’s salary grid falling behind,” states the report.
“This will lead to staff retention and recruitment problems as well as result in significant budget spikes following market reviews (i.e., every three to four years).”
However, when the 4% salary increase was added to the budget, it brought the proposed levy increase to around the 5.2% mark – a figure council found untenable.
“I’d like to get that to 3.9,” said councillor Matthew Bulmer.
It proved difficult to find savings, however.
Indeed, township staff had learned that its annual insurance premium for 2022 has risen to $147,696 while staff had budgeted $92,369 for insurance.
And the Municipal Property Assessment Corporation (MPAC) is once again postponing updating assessment values, so they remain at 2016 levels even while home prices have risen dramatically.
However, there was growth in Puslinch through new construction and renovations and that has been assessed at 1.73% and will bring an extra $43 million to the township.
Council also found savings in relation to the Highway 401/Highway 6 project. While it is a Ministry of Transportation project, Puslinch will need to review any congestion “hotspots” the realignment of roads will create, and staff had budgeted $25,000 for that project in 2022.
Ministry officials recently presented the project to council and given their proposed timetable Seeley didn’t think the township’s review needed to happen immediately.
“I think we can reduce that by $15,000 and spread it out over two years; $25,000 will be too rich.” the mayor said.
Councillor John Sepulis put forward a motion to reduce the amount to $5,000 in 2022 and spread the balance over future years. His motion passed unanimously.
Council also voted to move $50,000 from the asset management reserve to the gravel roads improvement discretionary reserve. This had no impact on the tax levy, but council wanted to bolster the fund so it can address the network of gravel roads throughout the township.
The Transportation Master Plan, currently under review, “will provide specific recommendations regarding the township’s road infrastructure including gravel roads, surface treated roads, and paved roads,” Hasan said in an email to the Advertiser.
In the meeting Seeley said it’s less expensive to plow and maintain paved roads versus gravel roads, and the majority of residents who live on gravel roads would prefer them to be paved.
At the end of the meeting, the township tax increase had been trimmed to 3.83% with a blended tax increase (Puslinch, Wellington County and education) of 2.03%. This amounts to another $116 in taxes on a median-priced home or $19 per $100,000 of assessment.
This is not the final decision on the budget.
A virtual public meeting is planned for Jan. 19 at 7pm, and council will consider this feedback before its final budget meeting on Feb. 9.