March 4, 2022 Newsletter: 2022 Budget Review – What you should know
The 2022 Budget is included in the 2022–2026 Financial Plan Draft currently under review by Council. The Financial Plan estimates total revenue will increase from $52 060,000 in 2022 to $66,399,800 in 2026 (page 37).
While this might appear to be good news, over $6,000,000 of this projected $14,339,800 revenue increase is in property taxes - a forecasted 27% tax increase. This is based on a still high, $4.9 % annual tax, property increase for 5 years and, that's if all goes well.
The Plan indicates that the other $8,000,000 projected revenue increase will come from a variety of sources. What is not clear however, is what the “other sources” substantial, forecasted $8,000,000 revenue increase is based on, or who will pay for any shortfall.
Residents have expressed many times that Oak Bay does not have a development cost charge bylaw or schedule. This, when combined with Council’s objective to add a significant increase in untaxable housing densification, are important factors that will have a significant impact on future revenues and expenses.
The Financial Plan’s Corporate Services Chart (page 48 and Appendix #1) only shows how many administrative staff taxpayers are now carrying. It provides no financial information or “Staffing History” as its title indicates. This Newsletter provides some budget expenditure transparency by providing the following adaptation of the District's Corporate Services Chart (see Appendix #1).
The 2022 Budget is included in the 2022–2026 Financial Plan Draft currently under review by Council. The Financial Plan estimates total revenue will increase from $52 060,000 in 2022 to $66,399,800 in 2026 (page 37).
While this might appear to be good news, over $6,000,000 of this projected $14,339,800 revenue increase is in property taxes - a forecasted 27% tax increase. This is based on a still high, $4.9 % annual tax, property increase for 5 years and, that's if all goes well.
The Plan indicates that the other $8,000,000 projected revenue increase will come from a variety of sources. What is not clear however, is what the “other sources” substantial, forecasted $8,000,000 revenue increase is based on, or who will pay for any shortfall.
Residents have expressed many times that Oak Bay does not have a development cost charge bylaw or schedule. This, when combined with Council’s objective to add a significant increase in untaxable housing densification, are important factors that will have a significant impact on future revenues and expenses.
The Financial Plan’s Corporate Services Chart (page 48 and Appendix #1) only shows how many administrative staff taxpayers are now carrying. It provides no financial information or “Staffing History” as its title indicates. This Newsletter provides some budget expenditure transparency by providing the following adaptation of the District's Corporate Services Chart (see Appendix #1).
Note: The 2 full time secretarial and part-time archivist salaries are not included in the calculation, as it was not possible to estimate their salaries.
“Staffing History”: in 2015 the Corporate Services Staffing consisted of a Chief Administrative Officer (CAO) and a Director and Deputy Director of Corporate Services (for a total of 3 administration positions). Their salaries totalled $375,930. In comparison, the Corporate Services 2022 staff compliment has been increased from 3 to 11 positions. The total salaries for the eight new full-time positions is $1,063,496 plus benefits (these are typically 20%-25%)
The rule of thumb for small municipalities like Oak Bay that have limited revenue and resources, is to hire broadly-trained, experienced and competent Chief Administrative Officers (CAOs) and Corporate Directors, who are well compensated, and have the training, knowledge and skills to not require a range of specialist staff.
There is an understanding, that when required, the administration could call in additional help. However, since 2015, from the number of new specialized staff and hundreds of thousands of dollars in consultant contracts, it is apparent that the District has not undertaken “either/or”, but both of these expensive options.
As indicated, Oak Bay’s seven-year Corporate Services hiring spree has increased the District’s annual budgets significantly. Unfortunately, not only are the high administration salaries and benefits ongoing but, this is only part of the financial picture: support staff, new office space, furniture, computers, printers, phone systems, office supplies and training, also come at a very high cost.
Oak Bay Watch Perspective
It is obvious that Oak Bay’s Leadership has decided that one of the District’s main priorities this Council term was to hire more and more administrative staff. Unfortunately, this has not in any effective way addressed what residents have indicated time and time again, are the District’s real problems:
Note: In addition to the eight new Corporate Administration staff positions many of Oak Bay’s other Departments have also added new senior staff.
Many of these new specialized Corporate Administration staff job responsibilities do not justify full-time equivalent employees (FTEs). For example, many small municipalities, corporate director’s standard job responsibilities, besides their regular duties, also include media communications and strategic planning. The creation of the Administration Program Assistant and two new Legislative Assistants positions were also a surprise to us and have us wondering how we ever managed without them.
Our understanding is that, as all, or almost all, of the eight new administrative job responsibilities since 2015, were previously provided by the CAO and 2 Corporate Director staff positions. It seems to us that if it were necessary to reallocate some of this administrative work, that was obviously not full time, it would have had far less impact on the District’s annual budgets, to either cost-share these services with another municipality or contract out these services as needed.
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“Nothing is inevitable if you are paying attention” Oak Bay Watch
Oak Bay Watch is a volunteer community association and its members have a variety of professional backgrounds in both the public and private sector.
*******Please help us continue to provide you with information about Community concerns and Council decisions and actions. Oak Bay Watch members also help community groups with their specific development concerns. Donate to Oak Bay Watch - even $5 or $10 dollars provides expenses for door- to- door handouts and helps us maintain our website. Oak Bay Watch is committed to ensuring the Community gets the full range of information on budget, governance and all key development issues – a well-informed opinion cannot be made without this.
(Please use Donate Button at bottom of oakbaywatch.com Home Page)
Keep informed and sign up for our newsletter – bottom of Newsletter Menu Item.
Appendix #1
District of Oak Bay 2022 Financial Plan V2 Draft Chart
“Staffing History”: in 2015 the Corporate Services Staffing consisted of a Chief Administrative Officer (CAO) and a Director and Deputy Director of Corporate Services (for a total of 3 administration positions). Their salaries totalled $375,930. In comparison, the Corporate Services 2022 staff compliment has been increased from 3 to 11 positions. The total salaries for the eight new full-time positions is $1,063,496 plus benefits (these are typically 20%-25%)
The rule of thumb for small municipalities like Oak Bay that have limited revenue and resources, is to hire broadly-trained, experienced and competent Chief Administrative Officers (CAOs) and Corporate Directors, who are well compensated, and have the training, knowledge and skills to not require a range of specialist staff.
There is an understanding, that when required, the administration could call in additional help. However, since 2015, from the number of new specialized staff and hundreds of thousands of dollars in consultant contracts, it is apparent that the District has not undertaken “either/or”, but both of these expensive options.
As indicated, Oak Bay’s seven-year Corporate Services hiring spree has increased the District’s annual budgets significantly. Unfortunately, not only are the high administration salaries and benefits ongoing but, this is only part of the financial picture: support staff, new office space, furniture, computers, printers, phone systems, office supplies and training, also come at a very high cost.
Oak Bay Watch Perspective
It is obvious that Oak Bay’s Leadership has decided that one of the District’s main priorities this Council term was to hire more and more administrative staff. Unfortunately, this has not in any effective way addressed what residents have indicated time and time again, are the District’s real problems:
- The over $450 million dollar infrastructure deficit. When is Council going to borrow the offered Municipal Financial Authority's low interest and still available improvement funding? Other Communities have taken advantage of these loans to significantly improve their infrastructure.
- Correcting the broken 2007 zoning bylaw, made even worse by the 2014 Zoning Bylaw Review Committee. This zoning mistake has resulted in the removal and destruction of scores our neighbourhoods’ more affordable homes to make way for very much bigger, often imposing, stereotypical, and very expensive housing. Council seems not to have noticed this election promise and resident priority, as they have recently moved the Zoning Review back another year, to 2024.
- Natural Asset and Tree Preservation: The Urban Forest Strategy recommendations have been almost completely ignored. Tree replacement saplings, like bicycle paths and pickle ball courts are supplementary, as saplings and ornamental trees cannot replace the benefits mature trees provide. Unfortunately, based on so many mature trees lost to development, the residents’ priority to preserve our Urban Forest is not reflected in the last three Council decisions and the Planning Department’s questionable tree replacement policy.
- The District's last satisfaction survey identified that a high priority for residents was to lower taxes. “Taxes /Spending too high” was the 2nd highest concern in the open-link part of the survey.
Note: In addition to the eight new Corporate Administration staff positions many of Oak Bay’s other Departments have also added new senior staff.
Many of these new specialized Corporate Administration staff job responsibilities do not justify full-time equivalent employees (FTEs). For example, many small municipalities, corporate director’s standard job responsibilities, besides their regular duties, also include media communications and strategic planning. The creation of the Administration Program Assistant and two new Legislative Assistants positions were also a surprise to us and have us wondering how we ever managed without them.
Our understanding is that, as all, or almost all, of the eight new administrative job responsibilities since 2015, were previously provided by the CAO and 2 Corporate Director staff positions. It seems to us that if it were necessary to reallocate some of this administrative work, that was obviously not full time, it would have had far less impact on the District’s annual budgets, to either cost-share these services with another municipality or contract out these services as needed.
---------------------------------------------------------------
“Nothing is inevitable if you are paying attention” Oak Bay Watch
Oak Bay Watch is a volunteer community association and its members have a variety of professional backgrounds in both the public and private sector.
*******Please help us continue to provide you with information about Community concerns and Council decisions and actions. Oak Bay Watch members also help community groups with their specific development concerns. Donate to Oak Bay Watch - even $5 or $10 dollars provides expenses for door- to- door handouts and helps us maintain our website. Oak Bay Watch is committed to ensuring the Community gets the full range of information on budget, governance and all key development issues – a well-informed opinion cannot be made without this.
(Please use Donate Button at bottom of oakbaywatch.com Home Page)
Keep informed and sign up for our newsletter – bottom of Newsletter Menu Item.
Appendix #1
District of Oak Bay 2022 Financial Plan V2 Draft Chart
