Twelve months ago, Prince Albert was sent into “crisis mode” after being dealt a devastating financial blow from the provincial government's 2017 budget.
The city was forced to make a number of eleventh-hour moves to patch up a $2.5 million hole that was blown in municipal coffers by Regina, leading to unexpected cuts to grant-in-lieu revenue sharing. These cuts left the city short another $3 million in 2018.
A “Buckley’s mixture” was how Brad Wall described the budget during his final speech as premier in January. While Mayor Greg Dionne believes budget 2018 will be much more digestible, he was still cautiously optimistic. The mayor said he wants to see the government make moves focused on getting people back to work in Tuesday’s budget.
“That is the only time I support running a deficit is to help the economy,” he said.
To do this, Dionne said he hopes the government turns an eye toward infrastructure incentives, specifically on housing, and revisits a major hurdle for the city — the introduction of PST on construction projects. He pointed to the new water reservoir construction announced Tuesday and said while the city received $6 million from the feds and $3 million from the province on the $12 million project, the city’s portion ended up closer to $4 million as they were forced to cover the PST.
“That doesn’t make any sense. When you give a grant to a city to do infrastructure, it should certainly be PST exempt,” he said. “I understand the government’s pickle, but I think what the government should have done in advance is sat down with some of the mayors and have a blank discussion on where we should be going.”
Dionne said the city plans to introduce a number of tax incentives to help the housing and commercial markets blossom, as the city has only handed out one housing permit to date this year. However, he said assistance needs to come from the province as well.
In his first major speech as premier in February, Scott Moe hinted toward another “tight budget” and a possible rework of the revenue sharing formula. Dionne was vocal on leaving the funding formula as it is, at one per cent of PST revenues. When asked if any progress has been made on the file, Dionne said there are “just rumours out there.” While the mayor said he wants to see the funding avenue restored, he held trepidation on where that money may come from. He said he prefers a “natural” accumulation of funds and not the province generating a new levy on taxpayers.
“I have no problem if it is coming from royalties or elsewhere but not new levies. I don’t want to create a new burden for our taxpayers,” he said. “That is what I am worried about, is that they are going to come up with a different program where they are going to collect the money from somewhere else and give it to us.”
Overall, Dionne said he hopes the province is cautious with the numbers and did not expect any major announcements. The mayor anticipated the province will continue to walk back some of the less popular decisions from 2017 but highlighted how stress has already been applied to the books.
“When you give $34 million back to education, well, where are you getting it from? That is always my concern,” Dionne said. “I do believe we are tapped out.”
During his run for leadership of the Saskatchewan Party, Moe promised to reintroduce PST exceptions on health, life and crop insurance, boost funding to education and balance the provincial books by 2019. The province has already followed through on the first two points, recently announcing automatic PST refunds on the previous taxed insurance, but has been mum on further details of what to expect Tuesday.
paNOW will have live coverage and reaction of Budget 2018, which is expected to come down April 10 at around 2:15 p.m.
On Twitter: @JournoMarr
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