Newsletter Sept Oct 2, 2021 - It can't get worse than this – Or can it?
A new Asset Management Infrastructure Program Update Report - Sustainable Infrastructure Replacement Plan - was presented at the September 27, 2021, regular Council meeting . The “Update” indicates Oak Bay has a $463.5 million dollar deficit and a 2022 12% tax increase has been indicated to pay for the infrastructure replacement.
Why should this set off “alarm bells” and be a concern for residents?
First, at the outset of this Council term 0ct 20, 2018, most of this Council and the new Chief Administrative Officer did not prioritize the infrastructure crisis even though:
- A substantial District infrastructure deficit has been known for a decade. The “2014” Official Community Plan provides the asset deficit information and states, “The District’s underground infrastructure is in its latter years of service and the needs for repair and replacement exceed the available resources."
- The withheld 2016 Opus Infrastructure Report had also provided comprehensive infrastructure information including its “poor and very poor” condition.
- The current Council campaigned on addressing the Infrastructure Crisis. For example, the Mayor’s website, prior to the October 2018 election, stated:
“Murdoch for Mayor – Crumbling Infrastructure - Raising Taxes.”
- We can all see the deteriorating state of our roads and sidewalks. Underground, our sewer, storm and water pipes have fallen into “poor” and “very poor” condition as indicated by multiple engineering reports.” The Mayor also criticized previous council priorities and said, “Our Community is falling into neglect while costs escalate. It’s time to fix our infrastructure AND finances.”
- This Council was warned early in this term that a third of the infrastructure budget was spent fixing pipe beaks and leaks
- The previous Council majority, underfunded infrastructure improvement in favor of adding new admin staff and densification initiatives. But in responding to residents’ complaints they explained that infrastructure replacement funding was the reason residents were paying record high, CRD leading, tax increases.
- In addition to all this, there are plans afoot by staff for yet another expensive questionnaire, notwithstanding that this Council has already shot down a staff proposal for a second $30,000 “Resident Satisfaction Survey”. The District was severely criticized for the two previous surveys whose questions were of questionable integrity: most of the past surveys have also been severely criticized and the previous Satisfaction and 2021 Budget Surveys’ scathing findings were ignored
The bottom line is, that to make any real impact on infrastructure replacement more funding sources are required. Sadly, the only funding source presented by Council is hefty ongoing tax increases funded by “yours truly” - Oak Bay residents. These are the same residents who are already paying for a top-heavy administration and paying more and more for ever increasing cost-of-living expenses. (see Appendix #1)
Note: The Public Work’s staff, who actually do the infrastructure work, has remained static over the last decade compared to the excessive amount of tax dollars spent to hire permanent administration and planning staff.
A presentation to the previous Council by the BC Municipal Financing Authority informed Council that there is very low interest rate funding available to municipalities for infrastructure improvement. This “loan information offer” has not been acted on by this Council or previous Councils - even though it enables new development owners to contribute to infrastructure costs.
It is obvious that most Council members and staff do not understand fiscal efficiency. Councillor Paterson, whose discussion in Council shows she certainly understands financing, requested at a Council meeting early in this Council term, that the District set up a finance committee. A finance committee could address expenditures and efficiencies and advise council and staff leadership accordingly. It would also provide oversight and the independent value-for-money audit approach. However, this has not been a Council or staff priority.
If the “Infrastructure Crisis” had received the same immediate staff and Council attention and prioritization as Oak Bay’s Single-Family neighbourhood densification initiatives and, the administration staffing expansion, we would have been much more advanced today than just producing a “long distance” future infrastructure plan.
(See Oak Bay Watch Perspective for this Council’s and previous Councils alternate expenditures and actions.)
At the September 27, 2021 regular Council meeting most Council members were celebrating that now, finally, there is going to be a Sustainable Infrastructure Replacement Plan “For the future” - albeit that infrastructure sustainability is projected for the next 100 years.
Additionally, most Council members appear not to have noticed that this “Futuristic Infrastructure Report” is a late-stage action, produced three quarters through their Council term. “Out of the gate” though in 2019 this Council and the Administration instead “prioritized” densification objectives and a collection of other non-essential items. These densification objectives were key priorities of the last Council.
It is not clear then why infrastructure was not prioritized this term as most of the present Council members know this last Council single-family neighbouhood densification had been strongly opposed and successfully rejected by residents at packed District open-house meetings in 2016 held at the University of Victoria. Substantial District financing and staff time had been wasted.
Nevertheless, the second stage of this Council term saw a $200,000 allocation for a (neighbourhood densification) “Infill Project Charter” Initiative startup as well as a million-dollar Municipal Hall upgrade.
A million-dollar Municipal Hall upgrade is the best part of a 5% tax increase. There seems to be no understanding that the cumulative Secondary Suite and Infill Initiative cost and implementation will only add to the current uncorrected excessive lot coverage infrastructure and climate change impacts. The Director of Finance has also informed Council new development is not paying its way.
Factor in the $1,000,000 administration staff expansion that adds significantly to the compounding annual budget cost increases, and it is easy to understand why the District of Oak Bay finances are precarious.
Oak Bay Watch Perspective
At the September 27, 2021 Council meeting, Councillor Ney stated she realized she was being political: however, she said as a member of the two previous Councils she was compelled to point out that “all the credit” to produce the District’s latest achievement, the Future Infrastructure Sustainability Plan should not go exclusively to this Council.
She said the previous Councils did much of the ground work to bring us to the point of actually producing a future infrastructure plan.
- As indicated, the last two Councils wasted hundreds of thousands of dollars on failed single-family neighbourhood infill densification initiatives and on hiring more expensive administrative staff. As well contracting consultant reports that were not acted on e.g. development cost charges. If enacted these charges would have allowed the new owners to help pay for the impacts their developments caused and relieved some of the existing resident tax burden
- The last Council also came under fire from Councillors Murdoch, Zhelka and Braithwaite for excluding the water tax increases from the property tax increase calculations. They also took issue with Council’s transferring infrastructure funding out of reserves. This made it appear that the tax increase caused by the majority of that Council’s overspending on less essential priorities, was not close to or a double figure amount. This “creative accounting maneuver” which was opposed, depleted what already were inadequate infrastructure reserve funds.
- To their credit Councillors Murdoch, Zhelka and Braithwaite although not a majority Council vote, were able for the first time in Oak Bay’s history, to reject the District’s annual budget.
- Councillor Herbert said it best. He was a member of the previous two Councils and a Chartered Accountant. Not acting politically, he said, “Our municipality is in a strong financial position isn’t true: our low debt hides the enormous price we will be paying to repair the failing infrastructure.”
Mayor Murdoch said he agreed with Councillor Ney regarding the allocation of credit for this late-stage action: currently being presented and celebrated as an exceptional achievement. It was not clear if the Mayor was being factious or if he was agreeing with Councillor Ney by confirming her statement that the last two Councils must also bare the responsibility of keeping Oak Bay’s infrastructure deficit where is was a decade ago: the $463.5 million Infrastructure deficit is basically the same.
If the Infrastructure Crisis and $463.5 million deficit had received the same immediate (January 2019) staff and Council attention and prioritization as Oak Bay’s single-family neighbourhood densification initiatives; expanding the administration staffing and the $1,000,000 municipal hall renos, we would have achieved much, much more than just producing a future infrastructure plan.
“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 Menu Item.
Cost of living No. 1 local concern:
A Leger poll, commissioned for Postmedia News just prior to the federal election, asked survey respondents to prioritize a number of issues and found that cost of living and rising inflation followed by managing the fourth wave of the pandemic, are top of mind for B.C. voters.
It is unlikely that Oak Bay’s property taxpayers, who have been paying exceptionally high tax increases since 2015, will find a 12% tax hike acceptable?