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Calgary city council to look at privatizing services to save on tax bills

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WATCH: As Calgary city council grapples with how to trim its budget, an idea is being floated to privatize some city services. Adam MacVicar reports.

A Calgary city councillor has a plan to privatize some city services in an attempt to save what he said would be millions of tax dollars.

Ward Sutherland says the city would save at least $1 million a year by contracting out a parcel of the Calgary’s waste and recycling program – specifically the black cart pickup program.

“It would be 25 per cent of the waste removal. We had has this conversation with management over the last couple of years.” Sutherland said.

“The move would affect 30 to 40 drivers. It’s a pilot project that would have to last six to seven years because of the recoup of the equipment. Then we would take a look at if we would expand it further.”

READ MORE: Value of Calgary’s city-owned golf courses to be examined by councillors

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The notice of motion will be going to council on Monday. Sutherland said he’s confident it will pass because a majority of 10 councillors have already signed on in support.

Sutherland said he’s also eager to see how the pilot project stacks up against the city-run program.

“It’s really going to give us the opportunity to compare apples to apples and see the cost efficiencies, to see if we can save additional money,” he said.

Sutherland said it could also lead to the city looking at the privatization of more city services, starting with another notice of motion that would see private contractors run city-owned golf courses.

“The message is: we can’t sustain it,” Sutherland said.

Click to play video 'Higher taxes or fewer services? Calgary tackles budget shortfall' Higher taxes or fewer services? Calgary tackles budget shortfall
Higher taxes or fewer services? Calgary tackles budget shortfall

”With the golf courses, the wages are just way too high and it’s not sustainable. Every year we are losing about $2 million with all the courses and we need some help and cooperation in having the wages in line with the reality of the market.”

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READ MORE: Calgary city council looking at scenarios to increase or freeze tax rate as budget talks continue

Council is grappling with a $52 million shortfall in this year’s budget and is considering all the options as it prepares to go line-by-line through all the services the city provides.

CUPE Local 37, the union that represents more than 2,600 outdoor city workers, is working to convince city councillors not to privatize.

According to Syril Wilson, the union’s president, CUPE Local 37 has presented a report to multiple councillors and city staff refuting the claim that privatization of services saves money.

“Our strategy is to just carry on, keep doing our work, make sure our members know to keep the service value up, don’t lose faith,” Wilson said.

Wilson said there is no language in their recently signed bargaining agreement related to privatization, but noted that garbage removal received an 84 per cent on this year’s citizen satisfaction survey.

“We’re doing more with less, but we still satisfy the citizens — 84 per cent that I saw,” Wilson said. “We always ask ourselves, ‘Why would we change something that’s working?'”

Sutherland said it’s his job to save money and find efficiencies. The notice of motion to privatize golf operations will be heard Monday or at the latest a week later when council begins its budget deliberations in ernnest.

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“Even if we are at $800,000  to $1 million or $2 million, well we have 69 service lines,” Sutherland said.

“When you start adding it up, it could easily amount to $50 million or so of permanent savings and efficiencies and could add up to more money long term.”

Bob Barnetson, a labour professor at Athabasca University, said Sutherland’s proposal to privatize city services is possible, but it depends on the language within the collective bargaining agreement between the city and the union.

Barnetson warned that the move could result in layoffs as well as a difference in the service Calgarians receive.

“Assuming the city can meet the procedural requirements in the collective agreement, presumably this would entail laying off existing city staff or otherwise terminating their employment,” he said.

“What tends to happen over time is we see the quality of the service begins to deteriorate when it’s privatized, and the cost of that service tends to escalate because, of course, now a private provider not only has to provide a service, but also make a profit.”

Wilson said the conversation of privatization has been ongoing for many years throughout his time working in waste management and with the union.

“We’re not trying to make money here, we’re just trying to make a living,” Wilson said. “We’re trying to do a fantastic job for the citizens of the city, and we do that.”

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–With files from Global News’ Adam MacVicar