Proposed tax hikes anger ratepayers

JOHN THOMPSON

Iqaluit councilors received an earful from angry homeowners during a presentation of this year’s draft budget on Monday evening.

“Many homeowners are troubled, outraged and deeply concerned about what appears to be happening at the city,” said Keith Irving, vice-president of the ratepayer’s association, as he addressed council and a crowd of some 30 residents who spilled into the hall.

The city’s draft budget includes an 8 per cent hike in property taxes and 5 per cent increase in water rates. But Irving said councillors need to cut back on the city’s spending, rather than increase taxes and fees.

For example, Irving said staff salaries have risen by 10 per cent over the last year. “I think that’s an area that should be given a very hard look at.”

He also argued that councillors are in no position to make sound financial decisions, because they haven’t been given up-to-date information by the city’s administration.

He said the two full days spent discussing the budget were wasted time, because councillors weren’t presented with an overview of the city’s financial situation. Only during the last 15 minutes were they briefed by Finance Director John Hussey that the city needed to raise taxes or run a deficit.

“You weren’t told there was a shortfall,” he said.

The city’s chief administrative officer, Ian Fremantle, defended spending plans.

He said past financial schemes for the city envisioned it going over $50 million in debt. In comparison, the city has only borrowed $1.1 million of the $4 million it’s eligible to borrow, under a plebiscite that residents approved during the previous council.

“I won’t put this city $26 million in debt,” he said. “I won’t do it.”

Fremantle also said he was puzzled by some criticism – particularly the complaint that the city hadn’t borrowed the full $4 million already.

“Why would we cost the taxpayers interest, on money we don’t need?” Fremantle asked.

The homeowner’s association made three recommendations:

* Create a budget only up to the end of March 2006, beginning a new fiscal year after that point – as recently recommended by the Government of Nunavut. During that time, freeze spending, taxes and water rates to 2005 levels while reviewing revenue and spending needs for this year.
* Hire outside help to work with the finance department to clear up problems identified by the city’s auditors last March. “I truly believe they need some assistance,” Irving said.
* Restructure the city’s finance committee to include two members of the public with proven financial experience.

Addressing the last point, Coun. Nancy Gillis pointed out that all council meetings are open to the public. “I haven’t seen anyone from the ratepayer’s association, except during budget time, at our meetings,” she said.

Gillis said she knew people weren’t thrilled about taxes and water rates going up, but the city has little choice.

“Hopefully the rates won’t be too harsh on anyone. There will be an increase, that’s an unfortunate reality.”

Councillors will meet this Friday to further discuss the draft budget. They will vote to approval the draft budget on Tuesday, Jan. 24.