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Statistics don't tell the whole story

It is always alarming to look at the Canadian Federation of Independent Business's annual watchdog report on spending and see that Whistler is the second worst offender for municipal spending growth in our region (Poor Lytton is #1).
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It is always alarming to look at the Canadian Federation of Independent Business's annual watchdog report on spending and see that Whistler is the second worst offender for municipal spending growth in our region (Poor Lytton is #1).

One's knee-jerk reaction is to bellow about how we are all over-taxed, how local government is not controlling its spending, how everyone wants their pound of flesh.

While there is always some truth to this position, there is also the truth of running a resort that sees over two million visitors each year (thank goodness) and the fact that spending to keep them happy is part of the reason the CFIB's figures make Whistler look irresponsible. In reality, the services we provide are for our tourists not just the nearly 11,000 who live here year-round.

And if you look at municipal surveys they tell you that for the most part people are happy with spending on parks, the trail systems and other "core" services of the municipality.

But still we are second from the bottom on the CFIB list... again! According to the report, which runs from 2000 to 2010, Whistler's real operating spending growth was 118 per cent, while the population growth was only 14 per cent.

This past week we also saw the release of the CFIB's Big City Spenders report. It looked at Toronto, Montreal and Vancouver — now there is no way to compare spending in Vancouver, say, to Whistler but the trend is there for everyone to see.

"Spending by Canada's three largest cities — Toronto, Montreal and Vancouver — has grown by 3 to 8 times the rate of population growth over the past 12 years, yet cities are talking about new taxes.

"The report shows municipal spending has increased by 55 per cent in Canada overall, while population has only grown by 12 per cent," states the report going on to say, "...The increases in spending are largely driven by public sector wages and benefits, which consume between 52 to 67 per cent of local government operating spending in the three big cities."

In Whistler, we have seen staff numbers come down following all-time highs needed for the 2010 Winter Olympic Games, but could they come down more?

And while the CFIB states that wages and benefits are higher at the municipal level than in the private sector there is plenty of evidence to suggest this is not the full story.

Statistics Canada figures from actual payroll data show that average wages paid by local governments have increased at a lower rate than overall average wages and at rates above the rate of inflation over the past 20 years. According to rabble.ca, "...average weekly wages paid by local, municipal and regional government rose from $622.67 in 1991 to $952.86 in 2012, a compound annual increase of 2 per cent a year, barely above the average inflation rate of 1.9 per cent during that period."

And, "This works out to annual pay of $49,549 in 2012.

"Average pay for those paid by the hour at the local government level was considerably lower: an average of about $40,000 in 2012."

With the release of the Resort Municipality's Statements of Financial Information report this week we can get a better idea of the Whistler situation for ourselves — last time around it left a pretty sour taste in everyone's mouths with 33 employees earning over $100,000 (and that was down 11 people from the Olympic year in 2010).

This year that number is down to 25 — due to a number of factors including retirements, severances and others who left for new opportunities.

You may recall that last year the total amount of remuneration according to the SOFI — including Employment Insurance, Canada Pensions Plan, health benefits and taxes, and taxable benefits — was $25.5 million. This year it is at $24.6 million – that's almost a million dollars less.

But let's take a step back.

The CFIB has produced this report since 2000. It determines the relative rankings based on an equal weighting of growth in inflation-adjusted operating spending per capita between 2000-2010 and the 2010 level of operating spending per capita.

Between 2000 and 2010, B.C.'s population grew 14 per cent, while municipal operating spending, adjusted for inflation, grew by 49 per cent, nearly four times faster than population over this period and more than twice as fast as real disposable income per capita.

Excess municipal spending since 2000 now stands at $4.26 billion — although it must be noted that the growth in spending has slowed considerably since 2009.

This year the CFIB also excluded policing costs, which I thought might have boosted Whistler, but we stayed at second worst despite this change.

As you might expect, municipal leaders are fighting back. Most met last week at the Canadian Federation of Municipalities' annual convention in Vancouver and once again slammed other levels of governments for downloading costs and responsibilities.

Karen Leibovici, president of the FCM, noted in the Vancouver Sun that of every tax dollar collected by municipalities, only eight cents is returned, while the province receives 42 cents and the federal government 50 cents.

"The fastest growing costs for property taxpayers are in areas where other orders of government have downloaded unwanted responsibilities on to municipalities," she said in a statement.

"When other governments off-load these costs, local governments have no choice but to pick up the tab, pull police off the street, or delay vital road, bridge, and water-main repairs."

Whistler has healthy reserves and there is a clear understanding of what might lie ahead in terms of paying for infrastructure upkeep.

But Whistler's reality is that there will not be large bumps in population growth to bring more money to the table in taxes — that's why it is more important than ever to foster a strong tourism economy and to use that to leverage multi-level government support.