Fiscal Responsibility – More than a Zero Percent Tax Increase! – Part 1

Just what is fiscal responsibility?

We hear this term bantered about so often and never more than during an election.  Especially this one.   All candidates will talk about the need to be fiscally responsible.  To some, fiscal responsibility means “no tax increases”.    The corresponding economic theory is that government doesn’t create wealth.  Only business growth will do that.  To others, fiscal responsibility it means “full support” by providing municipal funding to all social and artistic endeavors.  After all, they say, it is only by fully funding these initiatives that our social needs will be met and our quality of life improved.

Where do I stand?  Advocating for either of these extremes on the no tax/high tax continuum equates to fiscal irresponsibility.

 A zero based tax increase prevents the city from keeping up with consumer and municipal price indexes.   These two indices are real numbers and their impact on civic budgets can not be avoided. So it is misleading to say that one or two years of zero percent tax increase is the solution to a high tax burden when in the third and ensuing years the tax increase would have to be increased at a much higher level to manage the resulting financial shortfall.  The result would simply be to pass the tax burden from one year to the next.

Shortfalls in funding wreak havoc with the provision of municipal services.  Costs increase every year.  If the city fails to bring in enough revenue to support existing service levels an inevitable degradation of services occur.  Some would have us believe that increased costs can be borne within the current budget, implying that administrators are incompetent and mismanage the budget.  Further some believe that civic administrators perceive that the municipal tax base is an endless resource that can be tapped without regard to the impact on citizens.  My experience is the exact opposite.  All the civic employees I have worked with in more than 35 years of providing municipal services have been dedicated to their jobs and have taken seriously the requirement to guard the public purse.

The other end of the no tax/high tax continuum is to support every funding request that is deemed to add to our quality of life.  This is just as fiscally irresponsible and is based on the belief that government is responsible to fund all social programming.  This belief eliminates the concept of individual responsibility and the requirement for personal contribution to the health and vitality of the community.  If tax increases are levied to support the requests of all special interest groups, most citizens couldn’t afford to live in St. Albert.  And the reality is that many in our community have difficulty managing a yearly tax increase no matter how small it might be.

All of us need to participate to make our community a great place in which to live.  Individuals, sports clubs, social agencies, artistic groups, churches and service clubs, none are exempt from being a team player in community support and development.

Thankfully, St. Albert is blessed with a highly active group of dedicated volunteers.  They understand the necessity of community support to complement government programming and resources.

True fiscal responsibility lies in the ability to balance tax increases with community involvement to ensure that all municipal programs and services are maintained.

As a Councillor, one must understand the long term implications of each council decision and be principled enough to make tough choices, both for and against funding issues.  This is the mark of fiscal responsibility.