With growing inflation, rising costs, and a booming population, the Village of Pemberton’s (VOP) annual operating budget aims to address high staff turnover and declining revenue while striving to build reserves for the future.
At the VOP’s March 28 Committee of the Whole (COW) meeting, mayor and council received a presentation by manager of finance Thomas Sikora that doubled as council’s first opportunity to review the 2023 operating budget.
“We already looked at the capital budget. We’ve looked at the strategic direction, and I could translate those into a robust operating budget that follows some of the mandates around service and cost efficiency and accountability,” Sikora said in a presentation to council.
The key overlapping themes of the budget are organizational health, smart growth, emergency preparedness, the environment, and service excellence, with reconciliation, regional transit and flood mitigation among the other top priorities for the VOP.
The operating budget is currently in a deficit of $159,936; however, a surplus of $275,529 will carry over from the previous year, resulting in an overall net surplus of $21,094. The presented budget does not include tax increases, which council will discuss at the next COW meeting.
The VOP expects application and building permit revenue to decrease in 2023 compared to previous years.
“It’s a challenging forecast, but as we look at some of the views of where the markets are going and what we’re hearing from developers in the community, the view in developing this budget is that we are not likely to see as strong of a year as we’ve seen in the past, and year to date, so we took a very conservative view when forecasting revenue,” Sikora said.
Sikora noted that the VOP’s costs had significantly jumped across the board due to rising inflation, citing the British Columbia Consumer Price Index (CPI), which measures changes in prices as experienced by the average consumer.
Adjusted over the year, the CPI rose by 6.6 per cent compared to Dec. 2021. Inflation meant double-digit cost increases for the village, resulting in officials challenging, rejecting and retendering bids or deferring construction activity due to rising costs.
Labour and staff recruitment is another focus of the budget. Over the last two years, the VOP has experienced incredibly high staff turnover, at a rate of 25 per cent in 2022 and 35 per cent in 2021.
“A large theme this year, and a challenge we’ve seen over the last number of years that we’re trying to address in this year’s budget, is the turnover and staffing challenges that we’ve seen,” Sikora said.
“We’ve seen a lot of expenses to support finding new people, and through initiatives in this budget, we’re very hopeful to see our stability measured through retention and growth of people in this organization.”
The VOP aims to bring in a variety of initiatives in 2023 to address these challenges, such as increasing staff compensation annually to stay competitive (four per cent in 2023) and investments in training, development and succession planning.
But Pemberton’s growth may soon pose a different financial strain.
Under provincial legislation, when a municipality hits 5,000 people, it must pay 70 per cent of its policing budget, resulting in hundreds of thousands in additional costs for the village. In 2023, the VOP police budget stands at $288,447. Pemberton’s population, according to the 2021 Census, was 3,407.
Councillor Ted Craddock voiced concern about the amount of capital in the policing reserve, saying he wanted to see the municipality better prepare for the transition with moderate tax increases over several years so that future councils are ready for the change.
“I’ve brought it up before, and I hate to keep hitting on reserves for the RCMP, and I know this year it’s $288,000, but in five or seven years, it may be [over $1 million]. And I want to get an idea of how we’re going to get there,” Craddock said.
“My point is, I would rather fill up the reserve by taxation going forward every year for the next number of years so that when we hit this … limit, we’ve got the money all ready and can be sure that will cover it,” he added.
According to Sikora, in conversations between the RCMP and VOP staff, the current view is that Pemberton will not reach the 5,000 population threshold in the next five years. He pointed out the Union of BC Municipalities (UBCM) is working on the issue, but will consider Craddock’s concern as the VOP works on taxation implications for the coming years.
