Structural

We are well represented by our municipal council in Prince Edward County. They are a diverse lot—reflecting well the changing make-up of the County. Each brings a unique blend of insight, curiosity and diligence. And passion. Each is determined to do the best for their constituents and those struggling on the edges. It is evident in every budget deliberation—but more so this year.

But they are working with a bad budget process.

This last observation is from one of their own.

Due to the pandemic, Ameliasburgh councillor Andreas Bolik participated in budget deliberations by way of Zoom. As such, he was outside the bubble during the three days and one evening of the discussions about the municipality’s finances. He could observe the proceedings without the inexorable force that captures some councils in these marathon sessions. He was beyond the collegial pull to go along. To find a consensus. For consensus sake.

“This is the third budget this council has gone through,” said Bolik. “What strikes me watching over Zoom, as opposed to being there, is that this is one of the most absurdly convoluted processes I have ever been involved in. We have to do better.”

From his home office, it was plain. In the budget room, Bolik’s comments elicited a few eye-rolls and some uncomfortable smiles. But somewhere in each of them, they knew he was right. They slightly resented, however, that at the end of this 22-hour hostage negotiation, there would be no happy ending.

It is how they so easily discard their budget hawk personas for that of the salesperson. Rather than tell residents they are increasing the budget by 3.2 per cent, they launch into marketing spin. What would the increase look like if we deducted the new taxpayers from the tax levy increase? What does the hike look like per $100,000 of tax assessment? We are oh so close to comparing the property tax increase to a cup of coffee.

This look-here-not-there-three-card-Monty charade only serves to magnify the failings of a broken budget method. A relic of when local government didn’t work well at all.

When this current budget process emerged about a decade ago it was, certainly and unmistakeably, light years ahead of anything that had been tried since amalgamation. For the first time, council could see projected increases alongside actual performance in recent years. Council could compare apples to apples. They could see how much they spent on things like insurance or know the number of folks they employed. Basic stuff.

But the sheer scale and breadth of the businesses in which the County is involved—roads, waterworks, long-term care homes, arenas, grants to other groups—makes it a confoundingly difficult enterprise to synthesize down into a cohesive and meaningful whole.

The financial pressures on McFarland Home are vastly different than those on our town halls or marinas. Their capital needs and life cycles are vastly different too. Getting one’s head around it all—even over three days—is quite frankly an impossible task. That they work at it for four days, each December, is admirable. Yet it is unsuccessful as a financial governance exercise.

So council tends to dwell on the small, mostly insignificant bits—like grants or trucks. Or it blindly pushes for more money for roads. Why? Because their constituents complain mostly about roads. (Never mind that we can’t afford our roads. Never mind that no amount of borrowing or taxing will make an appreciable dent in improving the overall quality of County roads. Too many still cling to the fantasy that if they keep throwing more dollars into the road chasm, they will eventually fill it. Spoiler alert: They won’t. Too many still don’t understand that they can’t spend fast enough to do anything more than to slow the decay. That so few seem to have read and understood the implications of the Asset Management Plan prepared in 2014 should disqualify some council members from talking about roads altogether.)

The more worrying bit is that the gulf between finance staff and council is so wide—the language so different—that some choices get made by the bureaucrats that really ought to be made by the elected folks. Bureaucratic philosophies permeate municipal priorities and goals. Bureaucratic ambitions become municipal decisions. Not intentionally. Not by design. Just another bug in a broken process.

So what should it do? Some simple things at first. Break the enterprise down into similar business units. Understand the trends and the drivers in each unit. Where is the expense line going? Why? Same questions for revenue. Do the trends line up with demand growth? Population? If not, why not? This should prompt discussion about appropriate service levels— the kind of feedback and information staff really need.

It is not necessary to go over every line—especially out of context. Rather, good governance means understanding the forces that are propelling the various business units—the factors buffeting progress or guiding out-performance. They need more comparable data. More ways to measure performance relative to similar jurisdictions.

Simplifying the budget would be massively assisted by subcontracting the governance of the waterworks utility to a commission or authority governed by stakeholders in the system.

Council really ought to establish and empower a functioning audit committee whose job is to peer deeply and methodically into specific line items, expenses and spending policies. Since amalgamation, folks at Shire Hall have steadfastly and inexplicably, ignored what is an essential bit of governance. It is time for this to change.

Our local government has progressed mightily over the past couple of decades. It is time for its budget process to catch up.

rick@wellingtontimes.ca