A recommendation of a seven per cent cut across all City of Saskatoon departments and agencies is being brought forward by the Greater Saskatoon Chamber of Commerce as the city faces future budget shortfalls.
“Constraint breeds creativity,” said Jason Aebig, Chamber CEO.
Saskatoon is facing a $52.4-million funding shortfall next year and a $23.2-million shortfall the year after, with budget deliberations taking place throughout the summer.
This has been equated to an 18.56 per cent property tax increase in 2024, and a 6.95 per cent property tax increase the following year.
Aebig called this cut a starting point for city council.
“A clear and manageable target for cost reductions, mandated by Council, will give city administrators the direction they need to adjust staffing levels, find savings, and propose different ways of delivering programs and services.”
“For anyone else, it’s like trying to hit a bullseye from 30,000 feet. Managers are closest to the board. Set the target and challenge their skill and insight to hit it,” Aebig added.
He said the city is faced with hard decisions, noting that it will need to scale back plans, reduce staffing levels and innovate to deliver with less.
Aebig said business owners have had to do the same thing to deal with inflationary pressures, and says the city is no different.
“By establishing seven per cent as a target for cost reductions, city administration can propose a benchmark budget and then Council can make trade-offs between priorities, increasing cuts in some areas to reduce cuts in others, like front-line services and investments in community safety.”
“Importantly, it will ensure that decisions made through the budget process deliver the outcome we all need and want: a fair and competitive tax rate that closes the gap and keeps our city growing,” Aebig added.
He said this spread of cuts will prevent deep cuts in other areas that could potentially affect everyday life in the city as well as safety and capacity to grow.
Aebig said Saskatoon needs more taxpayers, and the only way for that to happen is to ensure the city continues to grow.
He said he’s worried that if city council goes line by line they may not realize they haven’t cut enough by the time they get to the end of the process.
“Nobody wants to be in a situation where we’re at the 11th hour at the end of November trying to make a decision on a two-year budget cycle, and we’re playing with the numbers in real-time.”
Follow-up meetings around budget discussions are going to be held July 25 and Aug. 15, but that hasn’t stopped city council members and economic and political analysts from giving their two cents on the canyon-like funding gap.
Everyone agrees that tough decisions are on the horizon, but they all have different ideas on how to approach the impending shortfalls.
Coun. Darren Hill has his sights set on the number of full-time equivalent staff the city has, saying there are a lot of staff and he’d like to see a 10 per cent cut starting at the top.
“What we need to be looking at it is the total number in relation to the work that they are doing in each of their individual business lines,” Hill said back at the end of June.
He said front-line workers are the ones performing the core services in the city.
“I think most of our cuts should come from middle management and upper management. Leave the front-line workers alone.”
Coun. Cynthia Block spoke to Global News last week saying that city council needs to work with city administration to whittle down the shortfall, noting that they need to give consideration to what councillors have been hearing from residents.
“The expertise belongs with our administration, however, I think we’re the ones who hear from residents. We understand the sensitivities, how much they want to keep the basic services that they have,” Block said.
She said by the final meeting in August she hopes they’ll be able to give administration enough direction for them to come back with a number.
Jason Childs, associate professor of economics at the University of Regina said property values aren’t rising like they have in the past, so municipalities will either need to increase mill rates or reduce spending.
“If you’re struggling to do the basic things that you think are absolutely essential just to keep the lights on, then some of these vanity projects or some of these really nice-to-have but not essential projects have to fall to the wayside,” Childs said back in June.
He warned that if Saskatoon raises property taxes too high, the city will face competition from surrounding communities and eventually end up hollowing out the city. He cited Detroit as an example of how that dynamic can play out.
Ken Coates, professor of public policy with the University of Saskatchewan, said back in June that Saskatoon needs to get comfortable with the fact that it’s a much bigger city, adding that cutting makes everyone nervous.
“I look at a deficit like that and think, ‘Oh my heavens that is a big tax increase coming and I’ve got no more space for that right now,’” Coates said.
He said Saskatoon is going to grow one way or another, and it can either grow poorly, or it can grow well.
Coates suggested that the city build a vision of what Saskatoon could look like in 2050, and try to appeal to the public with that vision.
“What people do not like is seeing taxes growing dramatically and systematically without them seeing a material improvement in their city.”