Downtown Medicine Hat is seen from the sky on Tuesday morning. Land owners in the Gas City are unhappy with what will amount to a 16 per cent increase in property taxes over the next three years.--NEWS PHOTO IAN SORENSEN

COLLIN GALLANT
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Jeremy Thompson is confident that a possible property tax hike of 4.9 per cent can be cut in half by relatively painless cuts and reorganizations in city operations.
On Monday, the alderman's queries about reducing a three-year budget plan by using a zero-based budget approach was met by a long list of eye-popping suggestions for cuts.
The presentation from Corporate Services commissioner Albert Bizio included the possibility of closing three outdoor pools, a recreational hockey rink, bus service on Sundays, new tree planting, the Police Park Interpretive program and so on.
Those aren't the types of cuts that Thompson was looking for, he said on Tuesday.
"At the end of the day, it came down to big, sexy cuts," said Thompson. "If we're going to cut an older rec-centre because it's inefficient to run, but not replace it, then people are going to be angry."
The idea, Thompson said, was to trim margins, not cut major projects, programs or facilities, and that $500,000 in new spending above revenue translates to a one per cent tax increase.
"We're going to have to go through it again and find those cuts," said Thompson. "It's going back to the committees... and I'm going to be going over the budget for the next two weeks, and trying to find (cuts) that can happen without hurting services."
Thompson feels the increases should be closer to the rate of inflation (2.1 per cent in 2011), plus the rate of projected city growth, estimated at 0.9 per cent.
Monday's presentation of the three-year budget plan comes with a recommendation for a property tax increase of 4.9 per cent this year, and 5.5 percent in both 2013 and 2014. That means the owner of a home worth $231,000 will pay an extra $56 this year and an extra $193 added by the time they receive their 2014 tax bill.
Bizio described the budget as conservative, and said local property taxes in the Hat fall on the extreme low-end of the scale compared to municipalities across Canada.
Keeping property taxes low should always be a concern, said Ald. Phil Turnbull, who feels further examination is necessary of expenditures in a zero-based format, where anything new accounted for by removing something else.
"I think the idea certainly still has merit but obviously it's new to the city," said Turnbull.
The process goes back to committees for adjustments before it is set for approval by council on Feb. 21, and according to Turnbull finding savings is not as easy as laying down a broad target.
"As a business person, you can look at all different things to reduce costs but what you wouldn't do is arbitrarily run five per cent across the board because that may hurt you. You may want better service in different areas," said Turnbull .
That job has to be taken up by city staff with clear directions from council, said Turnbull
"To ask a part-time alderman to micromanage a department at the city is not practical," he said. "You don't have the understanding."
Turnbull also sits on the City's Audit Committee, which now has the ability to commission value-for-money audits — a process the first-term alderman sees as the best avenue for finding better, less expensive ways of doings things.
A current examination of the city's fleet services by an independent accounting firm will examine everything from how big procurements are handled to whether a higher grade of motor oil is cost effective in extending the life span of a vehicle.
Money is budgeted to conduct two such studies a year.
Ald. Robert Dumanowski, who chairs the Audit Committee, also said people should expect the city to examine its own operations before it raises taxes but that Hatters have come to expect a certain level of service, which council shouldn't be afraid to offer.
"Nobody wants a tax increase but we have a community that has a phenomenal quality of life," he said. "Ultimately if you want those things, there is a cost."
Dumanowski also said this is the first time in his 11 years on council that city employees is expected to drop.
The city expects to eliminate 10 positions, about 1.2 per cent of its workforce, over the next three years as SmartMeter utilities are installed, several other positions are amalgamated and the surveying department is closed.
Salaries currently make up the largest portion of the city budget and account for 53 per cent — $73 million — of the $138 million total expenses.
The city has also budgeted $30,000 for a province-wide public wage comparison study that will be ready ahead of the next round of wage adjustments in 2013.
"The budget process is an exercise that's well worth its time and effort," said Dumanowksi. "It's done with a great amount of respect and scrutiny at the same time... The public just wants to know that there is methodology and some deep thinking that's gone on, and I can tell you that this was a highly scrutinized process that I believe has produced the best (budget) in the end."
The final budget will come back to council for approval on Feb. 21.
The Tax Bylaw will be debated in April. Citizens can view the budget proposal on the city's website at http://www.city.medicine-hat.ab.ca/