By Thia James

Melfort faces possible 4.9% tax increase

Jan 15, 2015 | 5:32 AM

The City of Melfort is looking at raising taxes 4.9 per cent in 2015, and the rising cost of goods and services is a main driver behind that increase.

On its own, rising inflation – the rising price level for goods and services – means that the city would need to generate 2.64 per cent more revenue. Existing requests account for the remainder of the proposed tax increase.

“Once we get some further finalization of potential revenue, such as revenue sharing and maybe some growth within the city, then we’ll know if that 4.9 per cent is realistic or whether the increase can be less than 4.9 per cent,” said Mayor Rick Lang.

He said 4.9 per cent is the high end of the tax increase.

Changes to the tax rate are calculated after administration goes over the existing budget, looking for areas where cuts could be made, keeping the same level of service, or justifying a reduced level of service.

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Then, inflation is factored in on top of the budget, which would give the City a slight tax increase. After that, the additions to the budget are considered.

And the 2015 operating budget is expected to add funds to a number of key existing programs. He said $42,000 of additional requests, or 0.9 per cent of the tax increase, would be for road maintenance.

The City had $50,000 in the 2014 budget for dust control, but is upping that to $67,000.

“And that has been an issue, because we have some areas of the city that are newly developed and they’re not paved yet, so there’s a demand for dust control,” Lang said.

The street patching program, too, would receive additional funding in the 2015 operating budget.

The program received $47,000 last year, and the City plans to increase the budget by $25,000 in the coming year.

Melfort is also setting funds aside for the Main Street Program, which it was accepted into recently. It’s allocating $15,000 to the program.

The City is also putting money towards maintaining the Northern Lights Palace.

As well, the City is establishing a small equipment, machinery and fleet replacement fund.

“It’s something that we’re just developing, and so we’ve put $17,000 into that, and in the future, we’ll be replacing our small machinery and equipment that we need to replace through that fund instead of through our capital program,” Lang said.

City council could approve the operating budget at the Feb. 9 meeting, but it could pass as late as March 9.

Melfort builds its infrastructure reserves

This year will mark the second year that Melfort deposits funds into its infrastructure reserve fund.

The City created the reserve last year, and allocated $85,000 to it. This year, $170,000 will be set aside. The amount is already set out in the existing budget because the reserve is a multi-year commitment.

Lang said at the end of 2015, they’ll have $255,000 in the reserve, and the contributions will be ongoing.

“So that probably by sometime in 2016 or 2017, we’ll be able to start doing annual infrastructure replacement, maintenance, etcetera through that reserve. But there won’t be sufficient funds in there to do that until probably the end of 2016 or early 2017.”

To replace, or not to replace, Main Arena

The City of Melfort has set aside special capital item funding to demolish Main Arena.

The aging arena’s roof is leaking and sagging. The structure also has problems with mold and moisture levels in its roof system. 

Lang said city council has decided to take a step back from its earlier plans to replace the arena. That doesn’t, however, mean that option is off the table.

“We have decided as a council that we will wait to the end of this particular winter then we’ll look at the number of hours that had to be re-allocated from what was the Main Arena ice time usage to outside communities, because right now, we are utilizing a couple of our neighbouring communities to address that ice shortage.”

At the end of the hockey season, the City will look at number of users that had to use ice out of town and at the actual ice usage at the Northern Lights Palace. Among other things, the City will look at how much of the out-of-town use could have been accommodated at the Northern Lights Palace. Then, the City will look at the idea of a second ice surface based on the ice hours needed, Lang said.

He added council has decided, in taking this step back, to make sure it has all of the numbers in place first for further analysis.

“Then after we get all of those numbers together and we see how many hours we were short, [we’ll] look at how much it costs to build a second ice surface versus how many hours it would be utilized for and then move forward on that basis.”

Lang said the demolition will go ahead before the end of winter. In the early spring, the City will look at either replacing the arena or “rationalization.”

“So, we haven’t definitively decided on a location for a second ice surface. We haven’t found a building that we can build yet for a suitable price. And in fact, I guess really what we’re second guessing is how many hours of usage would it get and is it something that we need to build immediately at this time?”

tjames@panow.com

On Twitter: @thiajames