Tonight’s entry in the “I Don’t Live in Red Deer But I’ll Ask Questions of Red Deer Candidates” questions focuses on Red Deer First’s Calvin Goulet-Jones. Even though Calvin was unable to answer all of the questions I sent, he did take the time to respond to the ones dealing with Red Deer First’s fiscal platform issues. I’d be lying if I said I wasn’t disappointed he didn’t get to more questions, but at least I can thank him for answering the ones he did. That’s far more than can be said for four of his fellow RDF candidates who either ignored my questions or sent automated responses.
How will Red Deer ensure a stable, and large enough, source of revenue to cover all necessary costs, or future costs, without having to increase debt if tax increases are limited to growth plus inflation?
In my opinion Red Deer has a stable, and large enough course of revenue to cover all necessary costs, being the taxpayers of Red Deer, as well as the federal and provincial grants that are consistently received for capital projects. The variable lies in whether or not council desires to live within our means. Going into debt to pay for emergency items, or even items with overwhelming citizen support is one thing, but it has to be recognized that we can not continue on this path we are on forever, the rate at which we are spending is simply not sustainable. We will either hit our debt ceiling, or we will raise taxes immensely, both of which I am not in favour of. It begins with listening to the citizens, which I will touch on more in further questions.
Calvin is correct in saying that Red Deer does have a large, stable source of revenue that’s made up of taxpayers. That’s not just taxpayers in the sense of Mr. and Mrs. Red Deerian paying property taxes, it includes businesses and any other legal entity required to pay taxes to the city. I also agree to some degree about provincial and federal grant money, but I’d make the case that those aren’t completely stable sources all the time. I don’t think it would be correct in assuming that every grant application coming from Red Deer will always be accepted, but if the majority are, at least there’s precedence for the money being available. Calvin’s statement that the council lives within their means also holds true; is the vision for Red Deer held by council one that’s achievable without taking huge financial leaps? That said, the city’s debt was projected to be at 90% of its limit by 2015; it’s nearly 2014 and the city is still around 50% of the limit. Is that ideal? No, but unless there’s a sudden 40% increase in borrowing in the next year and a half, it shows some remarkable restraint on the part of the city. I’d say that most people would also agree that they’d not like to see the city hit its debt ceiling or see their taxes raised. One on hand, you’d essentially cripple the ability of the city to pay for large projects, provide emergency support, etc. On the other, you risk the ire of residents with tax raises. However, were it to come down to having to choose to risk hitting the debt ceiling or raising taxes, I think the lesser of two evils is to accept raising taxes. Whether or not those tax raises would be immense is a matter of contention. Could Red Deer effectively provide services and complete projects by tying tax increases to growth plus inflation? Likely yes. Should some of the more fiscally conservative candidates consider a marginal raise in taxes above inflation if it meant more revenue that could be put towards debt payment? I believe so. What if there was discussion of a 0.5% increase over inflation with those extra funds going directly to debt repayment? I think people would be willing to pay that type of an increase if they knew that city services wouldn’t be greatly impacted and that it were for active debt repayment.
I’d also like to touch on a Letter to the Editor Calvin wrote in January 2013. In it, he writes, “I personally have a hard stance on City debt. I do not believe that any governing body should be allowed to carry debt for it manipulates the taxpayers into believing they are getting good services for their money, when in fact it is their children paying for the current service level.”
I want to focus on the last sentence, specifically the ‘children who pay’ part. Yes, large debt loads are passed on to subsequent tax generations. This is a trope often seen coming from American politicians who lament that trillions in debt will ruin future generations. Red Deer is not a country with trillions in debt. The $200 million needed for upgraded water treatment systems could not have been paid for easily without debt, and the benefits of these updated treatment facilities will be enjoyed ‘by the children’. I don’t think providing these types of services and financing them through debt is manipulating taxpayers into thinking they’re getting more out of it than they really are. Growth in Red Deer requires infrastructure to support it. If debt is used for major projects that benefit the entire city population, is it really fair to say it’s a manipulation of taxpayers?
Will cost comparison studies be used to determine the methods used for a long term debt reductions strategy, or are the two issues separate entities?
In my mind the two are separate entities. Cost comparison studies deals with how we are going to handle day to day expenses ensuring efficiencies in the short term so that we can maintain our budget with as little impact to taxpayers as possible. Long term debt reduction strategies deals with the fact that we do have debt that due to contract can not simply be paid off tomorrow. I would like to see an annual report with a year over year plan to bring our debt to 0… currently our annual report prints our payments until 2017 and simply prints “thereafter”. There is no plan to pay off our debt.
I believe that this question will split people into two camps; one saying they’re separate entities, the other not. Either way, it’s important to note that neither approach is wrong. Calvin’s explanation of cost comparison studies for day to day expenses is extremely valid. I think his approach to long term debt reductions strategies is a bit of an over simplification, and misses out on touching on where money will come from, how it will be spent on the debt, and how long the strategies will last. However, his point about contractual obligations with debt are true. The easiest example I have is a mortgage; if you try to pay it all off early, your mortgage contract will probably state that you’ll have some kind of extra fees to pay. You can’t get around them; they’re obligations and responsibilities you accepted upon taking that debt. I like Calvin’s idea for a year over year payment approach, especially beyond 2017. Printing ‘thereafter’ in the report to me sounds like someone waving their hand and absentmindedly saying “yeah, yeah, I’ll get to that at some point.” Think of how many times you’ve done that, or someone you know has done that, and then how many times they went “oops” afterwards. That said, if current annual reports do have re-payment amounts, you can’t outright say there’s no plan.
Will cost comparison studies focus on all city services, or focused on a limited number? What do you personally feel is the appropriate amount of financial and/or city resources to devote to these studies?
Many items can not be cost compared in a manner that would actually produce tangible results, water for instance is a government service and hopefully will always be a government service, the variables based on even simple factors such as location of reservoir, population size, temperature etc etc can throw off a cost comparison study. However, cost comparison studies in basic infrastructure needs are essential, If we could (hypothetically of course) remove our snow for 25% less we could remove our windrows without additional costs to the taxpayers… If we could pay the same amount towards filling our potholes but have them filled a couple months ahead of our current strategy, it would be worth it. As far as expenses devoted to studying cost comparisons thats where I believe we need to start slow, I do not believe in simply going all in, if we contract a small area of the city out in snow removal for instance we can establish a benchmark we could use to determine if the savings are worthwhile without great risk to the taxpayers.
The first part of the first sentence is something that Mayoral candidate Dennis Trepanier needs to read and understand very clearly. Cost comparisons, or more precisely cost benefit analyses, are tools that would be used to determine the net benefits from current costs for any service examined. Calvin touches on the fact that a CBA won’t produce tangible results for every service provided by a public government. If you manipulate numbers enough, you’d be able to get a clear result for anything, but I generally agree with his statement that a tangible result won’t be reached in some instances. Water service vs. infrastructure is a good example used by him; there’s only one source of water and one provider, so you can’t approach a CBA for water services the same as infrastructure services, nor could you use a CBA for road construction to determine how finances are appropriately spent for water. I also think his approach of starting slowly with CBA’s instead if rushing in head first is an excellent strategy. Better to gather the necessary information and plan properly than state you’ll do full cost breakdowns and analysis for everything right away. The idea of establishing benchmarks is another approach I agree with. The catch would be that a benchmark for snow removal might not apply to costs for, say, parks and recreation, but it would provide a benchmark for similar services. If city services were benchmarked as four or five separate areas, you’d have a much easier time reviewing costs in comparison to each other.
How will you personally solicit public input and opinions in order to determine if any funds will be released to a special interest group? If no consensus can be reached through community input, how will you approach the funding request?
We need to utilize the current methods of town halls, paper advertisement, and occasional radio advertisement to get there word out, but we must delve into the depths of online communication. We need to establish an online whiteboard that can appear via redder.ca so that policy can be discussed before it is voted on, and administrators maintain order (very different than Facebook, or twitter). We need to ensure all our councillors are accessible. Whether it is a special interest policy, or a policy on how much citizens want to put into pot hole removal it is the tax payers dollars and they should be able to discuss it. Regarding if no consensus is reached (and frankly during every vote) I rely on my principles which is to follow the rights and freedoms, weighing whether the item being voted on is enhancing the fact that everyone is equal, and weighing whether or not the item interferes with personal freedom.
I think Calvin is the first candidate I’ve heard or read say that online communication should be focused on as much, or more, than current, traditional communication methods. I think the idea of an online whiteboard at the city website is interesting, but there’s a difference between a whiteboard style page and a forum, which is what it sounds like he’s aiming for. A whiteboard won’t have an administrator or moderators, and would really only serve as a public notice board. A online forum would, but the issue I think the city would have there is deciding when to suspend discussion, and how to determine what type of feedback is or is not appropriate. Based on the online presence of the city right now, I think that expertise is sorely lacking. The easy example is the online feedback and discussions surrounding the bike lanes. Whomever the city had in charge of its facebook and twitter accounts handled those discussions extremely poorly, and communication between residents and city suffered for it. One other thing to consider about an online forum to discuss city policy is that you have to draw a line between resident feedback to proposed policy and the job council and city committees have to discuss and plan those policies. Too many voices at the table won’t make it easy to accomplish anything. Certainly, feedback from residents on proposed policies is good, but it’s still up to council to actually hammer out the details of them.
On the other aspect of this response, voting based on your principles is admirable, but basing every vote on whether something impinges on a right or freedom isn’t the best way to approach that. How do you determine it’s not restricting a right or freedom of everyone, especially personal freedom? What if six people want something and another four say it interferes with a particular right or freedom? Wouldn’t it be easier in this case to try and build consensus rather than try to determine which rights or freedoms are impacted? Any decision made by the city will impact those in some way for some people. The Charter of Rights and Freedoms provides a basis for our rights as Canadians, but I don’t think using it as a basis for making a decision where building understanding and cooperation would be a better approach is what it was meant for.
Will regular budget reviews be by calendar date, or done when any large spending is planned? How will the City Manager and Chief Financial Officer be involved in this process? Are you confident that regular, entire budget reviews can be completed quickly and not risk delaying any planned projects?
Budget reviews should be done annually by calendar date, and updates provided semi-annually. Since council does not individually write the budget the City Manager and CFO are not only involved but are essentially required to put their soul into the budget, I recognize it is no easy feat, and I respect all who work on the budget. Public budgets can not be completed quickly… We have taxpayers money involved, and decisions can not be made unilaterally. In fact, I believe our operating budget should have a 2 week lag added to it so councillors can take time to communicate with the citizens on their priorities. Planned projects show in the year over year budget, and unless a motion to reconsider comes up progression should not be delayed.
I think the idea of a lag in the budget for additional review and communication is interesting, but the immediate problem with that is that you can’t delay the fiscal year by two weeks to do that. Either you plan your reviews two weeks ahead, or you don’t use a lag. I’m also curious about Calvin’s approach to the times when the budget should be reviewed, given the Red Deer First website, and some of its other candidates, seem to advocate for budget reviews based on prescribed dates and spending. Essentially, Calvin is describing the current practice; the budget is released and debated before the start of the next year, there’s a mid-year review of both the capital and operating budgets, and annual financial reports at the end of each year. Given his response, I can only assume he endorses the current practice of budget reviews.
Do you believe that capital spending should be prioritized at annual or bi-annual times, or that it should be reprioritized if needed based on budget reviews?
Capital budgets are separate from operational budgets, and should be done annually. However, the capital budget is intrinsically tied to the operation budget as if you buy a bus, you need to hire a driver to drive that bus, so occasional reviews are needed to ensure the two budgets mesh. (this is part of the reason why the operational budget is a couple months after the capital budget). The long term capital plan also needs to be done annually so that we can reprioritize some planned spending based on community input.
Technically, capital budgets are done annually, but financial resources and requirements may span several budget cycles. The question then becomes, how easily can capital monies be re-prioritized by council if they’ve been assigned to a project over a span of multiple budgets. It would be well within council’s right and powers to determine if any funds should be diverted elsewhere, but any deadlines, deliverables and cost overruns due to delays from financial diversions must then be accounted for. I do agree that annual examinations of capital expenditures and plans should be done, and community input should have some impact on them, but I don’t think re-prioritization of capital projects should be based solely on that. If capital projects were based solely on community input, the spending process would become confusing and hectic in a very short period of time. Residents can be impatient. What happens if funds are diverted from one project in a year because the community feels it’s taking too long to complete?
As I said at the beginning, I’m disappointed that Calvin wasn’t able to answer more questions. I will say that I genuinely agree with a lot of the ideas he’s put forward though, with the caveat that I’m referring only to the responses he provided.
I’ll also openly admit that I believe Calvin should be on council. I do not believe that all the Red Deer First candidates should be, but I do think he should be. He would provide a point of view that many people think are lacking on council, and he’s shown himself to be very active in his discussions and interactions with voters in person and online. I also think that, even if his points of view may not agree with everyone on council, I think of all the Red Deer First candidates, he’d be the most adept at quickly learning how to build consensus.
I realize that this endorsement doesn’t really mean anything seeing as how I don’t live in Red Deer and some people have questioned why I’m bothering to ask these questions in the first place, but I have received good feedback from Red Deer residents, so I hope that they do take it to heart. Whether you want to call him a dissenting voice, devil’s advocate, or conservative doesn’t really matter if he’s elected. What matters is that Calvin’s presence would provide a more diverse council, which is a healthy thing for any governing body.