Newsletter October 10, 2021: It can’t get any worse - Or can it?
Part 2 - Property Tax Concerns - Amalgamation Information
It is obvious that in the last three Council terms, the top two leadership priorities have been to significantly expand the Administration and the Planning Department and allocate hundreds of thousands of dollars to densify Oak Bay’s singe-family neighbourhoods.
These Council and Staff priorities have significantly contributed to the year-after-year exceptionally high annual tax increases. The substantial funding used for densification initiatives and expanding the administration explains why property tax increases have been, and are estimated to continue to be, excessive and based on out-of-control expenses.
So many tax dollars over the past 10 years have been spent unnecessarily in all the wrong places. (More on tax dollar expenditures in future newsletters)
The 2022 property tax increase indicates a projected unprecedented 12%. In the 7 years since 2015, Oak Bay’s budget will have increased by nearly $10,000,000 and by 2025 the 10-year increase will be $15,000,000.
This unfortunately is not the whole story. If the latest budget information provided at the September 27, 2021 Council meeting is accurate the $15 million estimated budget increase will be much higher because it was stated that the property tax relief estimated for 2024 - 2025 can no longer be achieved.
The 2021-25 Five-year Financial Plan explains that if the annual budget costs get out-of-hand Council’s options are: to increase property taxes even more (e.g. the 12% indicated for 2022); cut services or use reserve funding accumulated and intended for other purposes.
Options that have been not considered are: cost-cutting; introducing development cost charges and low interest borrowing offered by the BC Municipal Financing Authority more than four years ago. The amount that can be borrowed is contingent on a number of factors but borrowing anywhere near the hundreds of million of dollars required is not a possibility.
However, a substantial amount could be borrowed to “kickstart” a short-term, improvement infrastructure plan that would hire more direct public works staff and/or contractors and get much more of the necessary work started.
In addition, the Municipal Hall renovation costs has been listed as 1.2 million, a 20% increase over the announced budget. No details have been released to explain the $200,000 overrun. However, offices for the new administrative staffing were a sizable portion of the project’s costs.
As well there is the probability of adding many more untaxable infill and basement units, and the inherent services required to serve the owner's new multi-tenant population. These added costs plus the related infrastructure infill impacts will escalate the present destruction of Oak Bay’s natural assets, not to mention making the District’s already precarious financial position even worse.
Forced Amalgamation may be the only solution. However, what would Amalgamation mean?
Oak Bay’s loss of identity would be the first casualty. This would be followed by the District's losing control of municipal service levels and zoning. The very aim of local government is to be connected to the average citizen: This would be lost. Research has also shown thet costs have not generally been reduced. There is also no guarantee that the problems of a joined municipality aren’t as complex and difficult to solve as Oak Bay’s present management problems.
Oak Bay Watch Perspective
The 2014 Official Community Plan and the messages of two Directors of Engineering have indicated “more on the ground staff” and resources are needed to do the real work to improve the infrastructure, So far however:
The leadership obviously has observing, consulting, more long-term planning and directing “down pat”. But this certainly does not include the missing “sense of urgency” or finding additional funding sources (other than the exception of even bigger property tax hikes}.
The facts indicate: the infrastructure deficit ($463 Million) has remained the same for many years now; it has also been reported that a lot of the infrastructure budget has and continues to be eaten up by failing pipes. In the meantime, substantial annual tax dollars have been used for administration staffing, consultant contacts and other staff priorities.
Public engagement has been reduced to a series of staff-promoted, expensive surveys of questionable integrity. Hiring more administration staff and consultants has remained constant. The surveys have been designed to achieve a desired result. Any real resident input has been avoided or ignored. For example, the top resident priorities: fixing the infrastructure and stopping excessive lot coverage have received little attention for over a decade.
It is not clear why the expansion of the Planning Department that includes a Director and Manager, would have to hire consultants to conduct densification initiative reports. Oak Bay had one Director of Building and Planning in 2015 who basically did the same work as the whole of the present planning complement. The District's development application fees are typically used to defray infrastructure impact costs. Note: not to fund expensive planning departments.
There has been no recognition by staff or Council that Oak Bay is a very small municipality with limited funding sources. It is not a for-profit business enterprise. Besides not meeting the definition of a corporation, corporations earn money, not just spend it.
Oak Bay does not need a top-heavy well-paid administrative staff, many of which are Directors or Managers of departments without any or very few staff. Oak Bay is a bedroom community that has a very small population of only 18,000. Many of which are seniors who already live in multi-dwelling accommodation.
The District’s spending practices have had limited oversight. It is obvious most councillors have no idea of the correlation between their approved tax dollar expenditures; the effectiveness of what this funding has achieved and the recognition of resident priorities.
Council has to come up with a plan to rail in some of these unnecessary expenditures, address the failing infrastructure in the short term (but not with quick, temporary fixes), do some cost cutting and efficiencies and get taxes under control.
____
“If you do nothing there will be no result” Mahatma Gandhi
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
Part 2 - Property Tax Concerns - Amalgamation Information
It is obvious that in the last three Council terms, the top two leadership priorities have been to significantly expand the Administration and the Planning Department and allocate hundreds of thousands of dollars to densify Oak Bay’s singe-family neighbourhoods.
These Council and Staff priorities have significantly contributed to the year-after-year exceptionally high annual tax increases. The substantial funding used for densification initiatives and expanding the administration explains why property tax increases have been, and are estimated to continue to be, excessive and based on out-of-control expenses.
So many tax dollars over the past 10 years have been spent unnecessarily in all the wrong places. (More on tax dollar expenditures in future newsletters)
The 2022 property tax increase indicates a projected unprecedented 12%. In the 7 years since 2015, Oak Bay’s budget will have increased by nearly $10,000,000 and by 2025 the 10-year increase will be $15,000,000.
This unfortunately is not the whole story. If the latest budget information provided at the September 27, 2021 Council meeting is accurate the $15 million estimated budget increase will be much higher because it was stated that the property tax relief estimated for 2024 - 2025 can no longer be achieved.
The 2021-25 Five-year Financial Plan explains that if the annual budget costs get out-of-hand Council’s options are: to increase property taxes even more (e.g. the 12% indicated for 2022); cut services or use reserve funding accumulated and intended for other purposes.
Options that have been not considered are: cost-cutting; introducing development cost charges and low interest borrowing offered by the BC Municipal Financing Authority more than four years ago. The amount that can be borrowed is contingent on a number of factors but borrowing anywhere near the hundreds of million of dollars required is not a possibility.
However, a substantial amount could be borrowed to “kickstart” a short-term, improvement infrastructure plan that would hire more direct public works staff and/or contractors and get much more of the necessary work started.
In addition, the Municipal Hall renovation costs has been listed as 1.2 million, a 20% increase over the announced budget. No details have been released to explain the $200,000 overrun. However, offices for the new administrative staffing were a sizable portion of the project’s costs.
As well there is the probability of adding many more untaxable infill and basement units, and the inherent services required to serve the owner's new multi-tenant population. These added costs plus the related infrastructure infill impacts will escalate the present destruction of Oak Bay’s natural assets, not to mention making the District’s already precarious financial position even worse.
Forced Amalgamation may be the only solution. However, what would Amalgamation mean?
Oak Bay’s loss of identity would be the first casualty. This would be followed by the District's losing control of municipal service levels and zoning. The very aim of local government is to be connected to the average citizen: This would be lost. Research has also shown thet costs have not generally been reduced. There is also no guarantee that the problems of a joined municipality aren’t as complex and difficult to solve as Oak Bay’s present management problems.
Oak Bay Watch Perspective
The 2014 Official Community Plan and the messages of two Directors of Engineering have indicated “more on the ground staff” and resources are needed to do the real work to improve the infrastructure, So far however:
- A 2016 comprehensive consultant infrastructure report was produced and withheld;
- A consultant’s Development Cost Charges report was produced but not acted on;
- The Director of Strategic Initiatives reports’ April 2019 to the present do not indicate any sense of urgency regarding prioritizing infrastructure improvement. In fact, the Municipal Hall Reno and Tod House received equal billing;
- The District recently contracted a whole host of new infrastructure consultants for roads, sewers, pipes.
- A Futuristic (100 year) Infrastructure Sustainability Plan that was presented to Council on Sept 27, 2021 provides no short term actions or objectives.
The leadership obviously has observing, consulting, more long-term planning and directing “down pat”. But this certainly does not include the missing “sense of urgency” or finding additional funding sources (other than the exception of even bigger property tax hikes}.
The facts indicate: the infrastructure deficit ($463 Million) has remained the same for many years now; it has also been reported that a lot of the infrastructure budget has and continues to be eaten up by failing pipes. In the meantime, substantial annual tax dollars have been used for administration staffing, consultant contacts and other staff priorities.
Public engagement has been reduced to a series of staff-promoted, expensive surveys of questionable integrity. Hiring more administration staff and consultants has remained constant. The surveys have been designed to achieve a desired result. Any real resident input has been avoided or ignored. For example, the top resident priorities: fixing the infrastructure and stopping excessive lot coverage have received little attention for over a decade.
It is not clear why the expansion of the Planning Department that includes a Director and Manager, would have to hire consultants to conduct densification initiative reports. Oak Bay had one Director of Building and Planning in 2015 who basically did the same work as the whole of the present planning complement. The District's development application fees are typically used to defray infrastructure impact costs. Note: not to fund expensive planning departments.
There has been no recognition by staff or Council that Oak Bay is a very small municipality with limited funding sources. It is not a for-profit business enterprise. Besides not meeting the definition of a corporation, corporations earn money, not just spend it.
Oak Bay does not need a top-heavy well-paid administrative staff, many of which are Directors or Managers of departments without any or very few staff. Oak Bay is a bedroom community that has a very small population of only 18,000. Many of which are seniors who already live in multi-dwelling accommodation.
The District’s spending practices have had limited oversight. It is obvious most councillors have no idea of the correlation between their approved tax dollar expenditures; the effectiveness of what this funding has achieved and the recognition of resident priorities.
Council has to come up with a plan to rail in some of these unnecessary expenditures, address the failing infrastructure in the short term (but not with quick, temporary fixes), do some cost cutting and efficiencies and get taxes under control.
____
“If you do nothing there will be no result” Mahatma Gandhi
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