ESTEVAN - The City of Estevan is trying to hold the line on property taxes for another year.
Estevan city council took its first look at the 2023 budget during a 5 1/2-hour meeting Monday morning and afternoon. Each of the department heads brought forward their operating and capital needs for the next 12 months.
The budget, at this point in time, does not include an increase to the municipal portion of property tax or a utility rate increase, but that could change between now and when the document receives final approval, which is expected to come late next month.
City manager Jeff Ward said there is always a discussion about raising taxes and utility rates, and which capital projects can be done.
“If you’re holding the line on taxes, you have to be very careful with what you’re doing on some of those capital projects,” Ward told the Mercury.
The city has been able to hold the line on the mill rate for now despite rising costs due to inflation. Ward cited fuel, chemicals at the water treatment plant and parts as among the largest rising costs
“Those are eating up a big chunk of the increase in the operations this year, so as we go through this process, there could still potentially be a tax increase, but from an administration point, we look at what we can and cannot do within our operations, and then provide that to council to see what capital projects we can do in the city.”
The lack of available parts has delayed some projects to later years.
“It just creates a backlog of projects, so that’s what we’ve seen happening this year, and without knowing what the environment is going to be like into next year – will the recession happen, will inflation continue to grow – we have to continue to budget conservatively.”
Revenues for 2023 are forecasted to be more than $25.9 million, with $21.6 million coming from taxes and grants, while fees and charges account for $4.3 million.
The forecasted revenues for 2022 were $25.5 million, with nearly $21.8 million from taxes and grants and nearly $3.8 million in fees and charges.
The increase in fees and charges is largely thanks to a surge in projected revenues for concession and alcohol sales at Affinity Place that would bring them back to pre-pandemic levels, Ward told council.
Food and beverage sales are expected to come in at $400,000, up from $175,000 in 2022, while alcohol sales are pegged to be $230,000, up from $87,500.
The general tax levy is expected to generate $15.924 million, up $224,000 from last year. A one-point increase in the mill rate would generate about $160,000, Ward told council.
Expenses for 2023 are pegged at nearly $24.5 million, which is up from the 2022 budgeted amount of $24.2 million. There is a $1.463 million net surplus from operations before capital expenditures.
The 2023 budget includes a built-in estimate for wage increases for the Estevan Police Service, whose most recent collective bargaining agreement expired on Dec. 31, 2021, and for the city staff, represented by CUPE, whose current agreement expires at the end of this year.
On the utility side, revenues for 2023 are pegged at about $6.3 million, down from the 2022 budget figure of $6.6 million. Utility expenditures are $5.5 million, which leaves a net surplus in operations of $740,066.
Meanwhile, utility expenses for 2022 were pegged to be $5.4 million.
A biosolids incinerator was among the projects included in the budget. Ward noted there is permitting from the Ministry of Environment on how to deal with sludge and biosolids from the wastewater treatment plant. Biosolids are currently being disposed of at the landfill, causing some issues for equipment.
“Those solids can by dehydrated, put into pellet and be incinerated to get rid of that waste,” said Ward.
The city spends about $200,000 just trucking sludge from the wastewater treatment plant to the landfill and treating it there. The incinerator would cost about $225,000. Administration in multiple departments is pushing for the project to occur.
“With the ever-changing environmental regulations, you never know when the government could come say that this can never be dumped in the landfill,” Ward said.
The budget also calls for work on McLeod Avenue and Duncan Road, with some areas needing watermain replacements and others requiring only resurfacing. Over the next few weeks, the city will be talking with homeowners in the area to gain feedback.
Other areas, such as Fifth Street from Souris Avenue South to Second Avenue, would be a significant expense, Ward said.
There was also discussion of paving Collins Road from Alice Road to Brown Road, a section of Third Avenue off of Perkins Street, and Valley Street near Trinity Lutheran Church, but those projects are not in this year’s budget.
The document also includes capital expenses for the vehicle fleet renewal, work at the Estevan Leisure Centre and other needs in the community.
The city is also applying for funding through the PrairiesCan coal transition fund for downtown revitalization. The first phase would be about $8.5 million, and the city is hoping to get $7 million. The city has said in the past downtown revitalization can’t proceed without support from other levels of government.
And the city is seeking federal and provincial funding for a storm sewer, sanitary and resurfacing project in the Westview area.
The city will also continue with debt repayment next year. It expects to pay down more than $3.5 million in debt, including interest, but that’s down from more than $4.2 million in debt paid down this year. The debt principle, if no new debt is taken out for capital projects, would be $10.4 million at the end of next year.
“We’ve done a great job of reducing debt – $30 million over the last nine years – and still getting some projects done, so council will have that to consider as we go through next year if they see some increased costing throughout the year,” said Ward.
The budget will be presented as a package for the public consultation later this month, and then people will be given a month to provide feedback.
“If there’s feedback, or capital projects that are identified that weren’t issued today, there could potentially be increases,” said Ward.
