Iqaluit councillors struggle with big demands, little money

Iqaluit councillors Kenny Bell and Stephen Mansell discuss the city’s budget problems at a Feb. 10 city council meeting. Bell chairs the city’s finance committee of the whole and Mansell is co-chair. (PHOTO BY PETER VARGA)

Iqaluit’s strained finances sparked calls of caution and alarm throughout a Feb. 10 council meeting, as councillors rebuffed new spending items and puzzled over how well the city is spending its money.

Coun. Terry Dobbin set the tone for the meeting by referring to the business community’s recent letter to the city, which contained pointed questions about the soundness of Iqaluit’s proposed budget and tax increases for 2015.

“I’m getting a lot of questions [from] angry businesspeople coming to me about the tax increases,” Dobbin told council in his member’s statement.

Tax increases ranging from 21 to about 31 per cent on commercial and industrial properties prompted the Iqaluit Chamber of Commerce to send a letter to the mayor and councillors, demanding that they postpone the increase until the city maps out a plan to eliminate its budget deficit.

A recent increase in property evaluations — which jumped by more than 54 per cent on all properties this year — has also confused the business community.

Dobbin said the city should do more to explain tax raises, much as Iqaluit’s neighbouring northern capital did last year.

“When Yellowknife’s property assessment went up 40 per cent last year, the city hosted an open house to help people understand their assessments, and respond to their questions,” Dobbin said. “We need to give business owners a chance to have their say, and explain why we’ve done this increase.”

The city’s proposed budget, drafted Dec. 23, will show a deficit of $4.19 million in the city’s general fund and $3 million in its water and sewer fund.

The city’s “unrestricted reserves” went down to just $424,000 from $4.4 million in 2014, largely due to the city’s dump fire that year, which cost more than $2.75 million to extinguish.

Dobbin said the city’s $40 million aquatic centre, the city’s biggest single project which is slated for completion at the end of 2016, now threatens to deplete the city’s finances.

The city is “overextending our capital by taking on a $40 million project by ourselves, with no help from two levels of government,” he said.

“We want a Cadillac version of the aquatic centre, and I do too,” he told council. “But the reality is, we can only afford a Volkswagen. And this aquatic centre project is going to eventually bring the city to its knees, financially.”

Dobbin recommended the city put the aquatic centre project on hold, or “scale down” the project, which risks taking funds away from “essential services” such as water and sewer infrastructure.

“If we don’t start funding projects deemed ‘essential services,’ we could be in serious trouble,” he said.

On a similar note, Coun. Kenny Bell reported to council that no fewer than five city buildings are showing signs of disrepair, severe enough that they could pose a threat to safety.

In response to complaints from city employees and residents, Bell said he took “some tours of city facilities over the last few weeks.”

“At moments, it made me literally want to cry, that our buildings, our vehicles, are in such bad repair,” he told council.

“We spend a lot of money on all kinds of things. The money’s being spent. But when I was looking around, it was hard to tell where,” Bell said in his member’s statement.

Later in the meeting, Bell gave a presentation with photos, showing lack of proper maintenance and repair in certain areas of the fire hall, the Arctic Winter Games Arena, the dog pound, and three other buildings that house garages and work spaces.

“The disrepair in some of the buildings makes me even more cynical about the aquatic centre,” said Bell, who has consistently opposed the project.

Concerns about the city’s finances also drove council to vote against sending a representative to a conference in Ottawa next month, called Arctic Age: Our Northern Future.

Organized by CityAge, the March 17 event will bring together leaders in business and government, who will speak about “new models of private and public investment in the Arctic,” the group’s website states.

Costs to attend are $395 for members of the public sector, according to the website. Airfare and accommodations are not included, Mayor Mary Wilman said.

“All I know is that other mayors are attending,” Wilman said. “The mayor of Yellowknife is presenting, the mayor of Whitehorse is also in attendance.”

A proposal to send Coun. Simon Nattaq to the conference didn’t get very far. Dobbin immediately opposed the idea. Coun. Joanasie Akumalik agreed, noting that the city’s immediate concerns about the budget would not reflect well on council.

Council narrowly voted against the motion, three votes to two. Nattaq and Akumalik abstained.

Council concluded the meeting with a clear vote in favour of sending a written response to the Iqaluit Chamber of Commerce’s letter. All councillors voted in favour except Nattaq, who abstained.

Bell recommended that council also meet with members of the city’s business community to explain proposed increases in this year’s property taxes.