Transit spill costs, deed taxes, pushing Halifax into deficit

City hall finance officials say Halifax is heading toward a $1.5 million deficit this year, spurred on by fuel spill cleanup costs at the Burnside transit garage and lower than expected deed transfer taxes.

The deficit is a small fraction of the Halifax Regional Municipality’s $869 million budget.

Containing and remediating the 200,000-litre spill first discovered in the spring at the Metro Transit facility is costing $2.3 million, according to a finance report reviewed Wednesday by a municipal committee.

“That should be it. It’s remediated and stopped,” finance director Greg Keefe said Wednesday.

Keefe said the municipality is looking to recoup some of those costs through insurance and from contractors. But he said there is also an insurance reserve fund that can be dipped into to cover the expenses, eliminating the projected deficit.

The municipality is not allowed to run a deficit, so it must make up any shortfalls.

Another hit to city coffers is being blamed on the slowdown in Halifax-area home sales. That’s left deed transfer taxes $3 million less than budgeted and $6 million less than the year before.

“It’s significant,” Keefe said.

The municipality's books are being helped in other areas, however, with projected surpluses in community and recreation services, and the finance and information department, along with higher transit tax revenues.