Frustrated residents roast Thunder Bay city councillors over proposed tax levy
Heather Kitching | CBC News | Posted: February 3, 2023 2:24 PM | Last Updated: February 3, 2023
Some are calling for the city to appoint an auditor general to ensure value-for-money
Thunder Bay City councillors got an earful from frustrated residents about its proposed 2023 tax levy of nearly 4.5 per cent, during their last chance to speak before the budget is ratified next week.
Councilors were listening to deputations from the public after more than two weeks of deliberating on the proposed budget, which is under pressure from inflation and increased policing costs.
Residents complained about the number of city staff earning more than $100,000 a year while people on fixed incomes struggle to buy food and pay bills. Some called for the city to appoint an auditor general to reassure residents that they're getting value for their money.
"For many years, administration and council have been unable to control spending and staffing levels," said Ray Smith of an ad hoc group called the Concerned Taxpayers of Thunder Bay. "The exodus to rural areas will continue as Thunder Bay's high taxes are chasing people away."
Karen Rooney spoke to council about the struggles of low-income seniors whose pensions and disability benefits do not always increase with inflation.
"With every tax rate increase, low income seniors have to make an equal adjustment to their fixed income budgets, forcing many to cut back on basic necessities," she said.
"They are forced to restrict the use of their vehicles due to the cost of fuel and the worry that overuse may incur breakdowns that they can't afford… All of these costs restrict a low income senior's ability to socialize with others, which creates a by-product effect of seniors becoming socially isolated."
Coun. Shelby Ch'ng, who has been reluctant to cut the budget, said that the kind of spending council is trying to preserve is the kind that makes life easier on low income people.
"We could easily cut the 55 Plus Centre, and then where would those seniors go?" she asked. "Those things do cost money."
She noted that the city has a program to help low-income people pay their property tax and water bills. Ch'ng also said it is unfair to suggest that the high tax levy is due to out-of-control spending or financial mismanagement.
"The bulk of our costs are police, fire [and] EMS," she said. "That's 37 per cent of our tax rate, 45 per cent of our overall budget."
Much of the cost is in wages, she added, which are often out of council's control.
Time for an auditor general?
The most detailed case for an independent auditor general was made by new homeowner André Gagné, who argued during his deputation that it's hard for council to judge the quality of the work done by city administration without independent guidance.
"Counselor backgrounds are diverse, and the amount of time and narrow, specific expertise needed to dig through an administration to uproot any major flaws is almost unfeasible," he said.
The very existence of independent supervision would motivate better performance from city administrators, he added.
Speaking to CBC after the meeting, Gagné, who has a bachelors degree in economics from Lakehead University, said, even if the position didn't save the city a lot of money, it would reassure taxpayers that their dollars were being spent in the most effective way possible.
Mayor Ken Boshcoff told Gagné he had heard the auditor general suggestion from multiple people during the budget cycle.
Coun. Mark Bentz said he could see potential value in the idea but questioned how independent the position would be if the person was hired by the city.
Gagné said he would consider an auditor general to be independent as long as the individual did not report to the city manager and was separate from the organizational structure that the manager oversees.
Currently, Thunder Bay has a manager of internal audit and corporate projects who performs similar functions to an auditor general, but that position is contained within the strategic initiatives and engagement division
City manager Norm Gale told council that, while it is true that the internal auditor reports indirectly to him, that is only for administrative reasons. He said that the auditor actually reports to the audit committee, which is an independent committee consisting of councilors and council appointees.
Gale said that most municipalities do not have auditors general because they are costly.
Toward the end of the meeting, several city councilors asked staff to respond to comments made by community members about taxes and wages at the city.
Asked by Coun. Kristen Oliver to reply to criticism about the number of city employees on the sunshine list – the list of public sector workers earning more than $100,000 a year – Gale said that 83 per cent of the people on the list are emergency services personnel.
What's more, he said, Thunder Bay is a rare municipality in Ontario that delivers all three emergency services: police, fire and ambulance, which helps account for the high numbers of high income earners.
He added that the list was introduced in 1996, and if it were indexed to inflation, the threshold for making it would now be more than $166,000.
Were that the case, the number of city staff on the list would drop by 90 per cent, he said.
Gale also explained how tax rates relate to taxation, saying that the tax rate is simply the factor that is multiplied by a property value to arrive at the tax bill.
"An average house in Toronto and an average house in Thunder Bay aggregately draw the same number of services between both homes," he said. "Yet the property value is four or five times higher in Toronto. … The tax rate is a variable that corrects against wildly varying property values."
The more expensive the property, the lower the tax rate, he explained. Thunder Bay has the second highest tax rate in the province because it has the second lowest property values.
But property taxes in Thunder Bay are slightly lower than the provincial average, he said.
Council will vote on ratifying the budget on Monday.
Corrections:- A previous version of this story said that the manager of internal audit and continuous improvement was contained within the city's corporate services division. In fact, it is contained within the strategic initiatives and engagement division. February 6, 2023 9:44 PM