HRM faces $30.4M gap

Report urges tax hikes, service cuts to balance books

Published: February 24, 2010 12:00 a.m.

Last modified: February 23, 2010 11:39 p.m.

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Halifax Regional Municipality is facing a $30.4-million budgetary gap in the upcoming fiscal year, council heard yesterday.

The report, delivered by director of finance Cathie O’Toole, cites higher service costs, an increase in the municipality’s compensation model, and the operating costs of new capital as the principal causes behind the gap. Expanded transit service for both this year and last also accounts for $10.2 million.

“We’re projecting (that) our expenses are up by $40.2 million, we’re projecting our revenues are only going to be up by $9.8 million,” O’Toole told council. “So the difference between those two is $30.4 million ... (that is) our planning issue we need to address between now and tabling the budget.”

The report recommends two possible strategies for balancing the budget, both of which include varying degrees of service reductions, transit rate increases, and tax hikes.

While divided on many of the specific recommendations, many councillors remarked the report was a wake-up call.

Coun. Steve Streach questioned some of the big budget items council is considering, including the new central library in Halifax and four-pad arena in Hammonds Plains.

“I think this is a year for slash and burn,” Streach said. “We all want things ... but do we really need them?”

Coun. Gloria McCluskey echoed Streach’s criticism. “It’s not only the cost, the capitol cost, but it’s the operating costs,” she said. “The four-pad arena, we didn’t even get the financial assistance we were supposed to get from the feds. Maybe we should have said ‘Hey, we’ll make it a two pad’ because we don’t have that other help.”

But O’Toole stressed no one cut or fee increase will close the gap: “There’s no silver bullet here,” she said.

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