City residents are facing a much smaller tax hike after councillors this week approved two cost-saving measures.

After many hours of deliberations at five budget meetings produced minimal cuts to the city’s proposed 2019 operating budget, resolutions introduced by Mayor Kevin Davis and Coun. Rick Weaver slashed the projected annual increase on the average residential tax bill from $158.64 at the start of Wednesday’s meeting to $83.89 by the end of the night.

Right now, the operating budget sits at just over $156 million. That represents a 3.08 per cent increase over 2018 and would mean an increase of 2.71 per cent.

“We were looking at death by 1,000 small cuts and not getting very far,” said Weaver.

The moves to reduce the city’s operating budget include using some unexpected proceeds from the sale of property on Shellard Lane and suspending, at least for this year, the 1.5 per cent capital levy, a system put into place to generate funds for capital projects.

Weaver worked with city staff to distribute about $7 million in unallocated proceeds from the sale last year of 57 acres of property on Shellard Lane to Lindvest Acquisition Corp. of Toronto.

“We were expecting to get $22 million and got $30 million,” said Weaver.

“It made sense to do something with it.”

Money from the sale will help fund the construction of the southwest sports complex on the north side of Shellard Lane, which will include playing fields, parkland, playgrounds, picnic shelters, trails and parking. Phase 1 of the project, set for construction to start this year, will include four illuminated baseball diamonds and a community park.

The extra cash from the land sale, Weaver said, can be used to “offset what is a very tough budget year.”

Weaver’s motion, approved unanimously by councillors, allocates:

$2.6 million to replace proposed debenture financing for the construction of a road from Shellard Lane to the sports complex, eliminating the need for future debt servicing costs;

$1 million toward additional funding for a new clubhouse at Northridge Municipal Golf Course;

$1 million to offset the cost of WSIB expenses included in the 2019 operating budget;

And a $2.3-million contribution to the accident prevention reserve to mitigate the impact of future WSIB costs.

The city has been grappling with more than $2 million in Workplace Safety and Insurance Board (WSIB) premium costs for first responders. A surge in claims from police began a couple of years ago, said Davis, when the Ontario government passed legislation recognizing post-traumatic stress disorder as a work-related illness for police, firefighters and paramedics.

Weaver’s resolution also called for a meeting of the Shellard Lane Task Force to receive an update on the scope and timing of Phases 2 and 3 of the sports complex project.

“This is a responsible use of the funds received on the sale of property which were, in some ways, unexpected,” said Davis, adding that the WSIB costs had “created a certain amount of havoc at city hall.”

The mayor said the accident prevention reserve will act as a stabilization fund to be used over the next few years to cover WSIB costs as work is done to lower the number of PTSD claims.

Coun. John Utley said the allocation of the extra land sale money will “go a long way to achieve a more realistic budget.”

The mayor’s resolution, which also received unanimous support from councillors, indefinitely suspends the 1.5 per cent capital levy.

It also directs city staff to review the 2020-28 capital forecast, which includes capital projects proposed for the next 10 years, and come back to the estimates committee before July 1 with a revised forecast “capable of being funded without the additional levy.”

Davis said that, while the 1.5 per cent levy is meant to generate $130 million over the next decade to fund capital projects, including the purchase of assets and improvement of existing infrastructure, such as roads, bridges, sewers, and equipment, it creates a “dramatic increase on the operating budget.”

The city’s 2020-28 capital forecast includes projects valued at $854 million.

Some capital projects, said Coun. John Sless, have been in the forecast for years but changing circumstances mean they are no longer viable.

“Something we don’t do very well is review the capital budget because we’re so fixed on the operating budget,” said Sless. “We don’t review it because it doesn’t affect the tax rate.”

Sless said reviewing the 10-year capital plan will allow staff and council to “take out what we’re not going to build and rid ourselves of things that are taking up space in the budget.”

Coun. Dan McCreary said he never supported the 1.5 per cent levy to fund capital projects.

“We need to live within our means and realign our vision of the future.”

Davis said that, if the city is unable to find alternate ways to pay for its capital projects, it can re-instate the levy.

The mayor also directed staff to look at capital assets owned by the city, including real estate, to identify those that are “surplus or non-essential” and put them up for sale with the money to be used to fund the 10-year capital plan.

“We need to come up with a method of paying for projects with assets at our disposal,” he said.

There may be more cuts to come for the 2019 operating budget.

The estimates committee will meet again on Feb. 25.

In the meantime, city employees are being offered a voluntary exit program as a way to reduce the budget. The city has about 1,100 permanent employees. If their applications for the program are approved, employees have until March 29 to leave their jobs.

mruby@postmedia.com