City of Saskatoon facing $20 million deficit: report

Click to play video 'City of Saskatoon facing $20 million deficit: report' City of Saskatoon facing $20 million deficit: report
WATCH: City of Saskatoon administrators say the COVID-19 pandemic and efforts to clean-up after the recent blizzard are why the deficit is growing – Nov 23, 2020

A report, written by the City of Saskatoon administration, projects a $20.1 million deficit for the city.

The two main reasons for the financial shortfall, it states, are lack of revenue caused by the COVID-19 pandemic and lockdown and expensive efforts to clean up after the recent blizzard.

Administration officials presented the financial update to the Governance and Priorities Committee (GPC), which is comprised of Mayor Charlie Clark and all 10 councillors, on Monday.

Read more: Saskatoon city council votes to implement power rebate

“The COVID-19 pandemic has presented significant challenges for the City of Saskatoon,” it states.

Kari Smith, the city’s finance director, told the GPC that “(t)he administration estimates that this storm will overspend the overall snow and ice budget by about $10 million.” She stated she is also expecting the city to be paying for the storm into next year.

Story continues below advertisement

The report showed the city is earning less from transit, traffic tickets and parking, all of which decreased because fewer people are travelling during the pandemic.

She said the City still had the $15 million that council allocated from a paved roads preservation project, and an additional $19 million from the federal government, to make up the deficit.

The provincial government allocated money to offset the $15 million.

In response to a question from Coun. Randy Donauer, Smith stated that provincial law forbids a city from running a deficit.

She said the administration will work towards balancing the budget, but didn’t know how exactly it could be done just yet.

“We don’t have the plan laid out yet… because we don’t know what that final number will be,” she replied.

Read more: Saskatchewan bracing for deficit that will take years to recover from: finance minister

She said the administration will be able to report the final amount of the deficit early next year, at which point the reallocated and federal funds could be used.

She also told the councillors that the projections can change — which they have already.

Story continues below advertisement

Monday’s financial forecast showed a deficit that is $6 million greater than the previous update, presented in September.

Council will discuss further financial adjustments during the upcoming budget talks, scheduled for Dec. 2 and 3.

Click to play video 'Saskatoon continues to dig out from winter storm' Saskatoon continues to dig out from winter storm
Saskatoon continues to dig out from winter storm – Nov 10, 2020