Council approved a 2.97% tax rate for 2013.
We have made great strides in our approach to financial management over the last several years. We have built up a set of financial management principles, policies, and practices that have enabled us to close the gap between tax rate increases and the consumer price index following a significant period of downloading from the provincial government. You can see this trend in one of the slides that I presented in my State of the City Address this year to the Guelph Chamber of Commerce. We have achieved this through a persistent focus on conservative, long-term financial management practices so that the gains we make can be sustained over the long term.
Council as a whole has increasingly assumed a more strategic role in setting the budget, getting out of the way of our Administration whose job it is to manage the organization, while expecting an enhanced level of accountability and reporting on their performance. We are poised to take the next step in enhancing the way we do business with the approval of the 2013 budget.
This budget will increase the capacity of Council to fulfill its oversight responsibilities to our constituents and the capacity of the organization – from the front-line to the executive leadership – to deliver excellent results for all citizens, exceptional personal experience for all customers, and value for money for the taxpayer. The budget has been aligned to the goals of the Council-approved Corporate Strategic Plan and continues good progress on doing business differently.
Council also approved a new efficiency target ($500,000) to challenge our management team in 2013.
Sometimes members of Council look to hold the line on taxes by removing specific items from the budget to achieve this. This can negatively impact services and/or increase risk. Others might look to the Rate Stabilization Reserve at the end of the evening to reduce the tax levy. The Rate Stabilization Reserve negatively impacts the base budget in the next year. This reserve was not used in 2012 or for the 2013 budget.
The efficiency target respects the management expertise and responsibilities of staff and is more appropriately aligned with our governance role as Council. It will also lower the base budget next year (a good thing) which is the opposite of what using the Rate Stabilization Reserve does. Performance on the efficiency target will be reported to Council throughout the year as part of our regular monitoring of our budget.
Each year, efficiencies are found by our employees that help reduce the next budget. Now with the efficiency target in place, some of this work will be made transparent to Council and the community.
It won’t be the first time for politicians to take credit for a good idea so let me say it here – the idea for an efficiency target came from a public delegation. Councillor Karl Wettstein, in particular, began to talk up this idea with his colleagues and our CAO and the idea took hold.