In addition to cuts announced this week, Chief Del Manak expects he'll have to announce more cuts soon.

VICTORIA — Victoria’s police department has disbanded a unit that targets prolific criminals, curtailed its front counter hours and is warning of more cuts as it wrestles with how to pay the NDP government’s new employer health tax.

Chief Del Manak said he’s had to reallocate $690,000 out of his policing budget this year to cover the province’s new tax, which has contributed to an economic crisis that will lead to even more departmental cuts being announced next month.

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“That $690,000 is a significant impact in our overall budget,” Manak said Thursday. “And it’s not going to be a one-year thing. … Now we’ve got to find those savings from within.”

The police force announced Wednesday it had reassigned nine members to routine patrol from a crime-reduction unit that was supposed to target online stolen property, street gangs, property crime, prolific offenders and the opioid overdose crisis.

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“I have so many gaps I have to collapse police divisions just to keep officers on the front lines,” said Manak. “I’m trying to keep my head above water.”

The department has been in a protracted conflict with some City of Victoria councillors over its budget.

Key to the dispute is council’s decision to fund the extra costs of the provincial employer health tax for every city department except the police. Other municipalities, including Vancouver, covered the new tax costs without requiring police to find the money within their budget.

Manak had asked for a six per cent increase to his $54-million budget to hire six more officers and pay the employer health tax, but was given a 3.2 per cent increase by council. He said that will require him to curtail retirement payouts, cut spending for new vehicles and computers, restructure his units and dip into contingency funds.

Manak warned public safety is at risk.

The dispute is playing out in the riding of Finance Minister Carole James, who has steadfastly dismissed criticism of the employer health tax since introducing it in 2018.

The tax is a replacement to Medical Services Plan premiums, which the NDP campaigned in 2017 on eliminating. But local government have complained the new tax downloads costs far more than the old MSP premiums and that translates into municipal property tax increases.

The tax will require businesses and municipalities with payrolls of more than $500,000 a year to pay a 0.98 per cent tax on annual payroll. That increases to a high of 1.95 per cent on payrolls of $1.5 million or more.

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The B.C. government is also double-dipping in 2019, charging the new employer health tax as well as a reduced 50 per cent rate of MSP, which disappears in 2020. That’s expected to generate almost $3 billion in revenue for the province.

James did provide exemptions for hospitals, schools and some charities that had warned the extra costs would drive them out of business. But she’s told municipal governments to deal with the increase using property taxes.

“They’ll be able to absorb most of those costs,” James said last year. “Even if they took all of the costs of the EHT and put it on to homeowners, you would be looking at about $20 to $40 a year in additional costs.”

On Thursday, James’s ministry said in a statement: “Local governments manage their priorities and their budgets.”

Liberal critic Mike Morris, a former RCMP inspector, said it’s unfair that police have to cover new government taxes when they are already wrestling with more complex investigation costs, cyber crime and combating the overdose crisis.

“Police don’t have enough resources as there is, they are always scratching to get the job done,” he said. “And to have this tax imposed on them by a government that doesn’t appear to care is disconcerting to me.”

Manak said more cuts are inevitable as he wrestles with cost increases for salaries, fuel and retirements, along with the fact that more than 35 officers in the 243-officer force are unavailable due to injuries or other reasons.

The old MSP system cost Victoria police $40,000 in 2019 as part of government’s double-dip year, meaning that in future years the department will still need fund approximately $650,000 annually to cover the new employer health tax.

Manak said government’s new tax, and city council’s refusal to cover it, has left him in a tough spot.

“I feel like I’m caught in the middle.”