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This article was published 26/2/2019 (574 days ago), so information in it may no longer be current.

When Winnipeg councillors and department heads sit down later this year to begin laying out the framework for the city’s first four-year budget, they should occasionally look to their counterparts in Calgary.

The City of Calgary has been doing multi-year budgets since 2006, but it was the four-year plan for 2015-18 that has become the cautionary tale for civic politicians.

Calgary city hall expected another long, prosperous ride on the oil train when it finalized its 2015-18 budget in November of 2014: continued growth in revenues, expanding services and annual property tax increases for the following four years of 4.5 and 4.7 per cent.

Before the ink was even dry, the bottom fell out of the oil industry.

To an outsider, it looked as if Calgary’s politicians and department heads had to throw the detailed four-year plan out the window and just wing it — like most municipalities across the country do every year — but councillors and senior administrators reached by the Free Press said they rolled with the changes and made "adjustments."

"We certainly had to adjust," said Druh Farrell, councillor for Calgary’s Ward 7 and one of the longest-serving members of council.

"This was an extraordinary recession for Calgary. We have booms and busts, but this one was exceptional and of longer duration.

"Yes, we did have to adjust, but we didn’t have to throw out everything. We still have policies and strategies that are long-term. It’s very difficult to meet your long-term objectives if you’re looking at your budget fresh every single year."

According to Calgary’s Action Plan, when the economy was booming, the priority of taxpayers was to maintain the prized civic services — and they weren’t too concerned about high property taxes. But by 2018, citizens’ attitudes had changed, the budget document noted.

"This dramatic shift in the economy also brought with it a shift in citizens’ needs and priorities. With employment increasing and average personal income levels falling, citizens have shown a willingness to accept some reduction in service levels in order to maintain low tax rates."

Calgary’s plans for annual big tax increases were scaled back. In 2017, there was a property tax freeze.

While Winnipeg Mayor Brian Bowman vowed to cap property tax increases to 2.3 per cent annually for the length of his second four-year term (which started in October 2018), rewriting Calgary’s growth budgets to cope with the downturn in the economy would carry a steep price.

Calgary administration said limiting tax increases to two per cent would result in a $13-million reduction in service delivery; a freeze on property taxes would mean a $45-million reduction in services.

"There are unexpected things that happen," Carla Male, Calgary’s acting chief financial officer, told the Free Press.

When the economy was booming, the priority was to maintain civic services and taxpayers weren’t too concerned about high property taxes, but by 2018, citizens’ attitudes had changed. (Jeff McIntosh / The Canadian Press files)

"As a Calgarian, the last number of years have been challenging as a result of natural gas and oil prices (falling), so we naturally had to adjust to a very different resource sector that we saw in the number of years previous to that."

Farrell, first elected in 2001, said those four years were challenging, but council was able to keep in mind the original goals and objectives mapped out in 2014 as they grappled with a long economic bust cycle.

Gian-Carlo Carra, Calgary councillor for Ward 9, said what the city does would be better described as a long-term plan with a series of budgets to ensure the plan is achieved.

The budgets are amended annually, he said, as necessary, to stay as close as possible to the long-term plan.

"When you start working on a multi-year process, you can be a lot more strategic and methodical about your longer-term goals," said Carra, who was elected in 2010.

He acknowledged the process has been criticized because it’s considered not responsive enough to changing circumstances, adding that hasn’t been the case in Calgary.

"The secret is to do both: be multi-year in your planning, but more nimble and responsive on the ground," Carra said.

For 2015-18, "we were planning for the explosive growth that we had been experiencing for many years. And as soon as we inked the budget, the downturn in the national price of oil hit Calgary hard and we had to reverse course very quickly," he said.

"That’s a classic example of things changing substantially. I don’t believe it was a problem."

Carra and Farrell said Calgary council does extensive community consultations in the year leading up to the point where a four-year plan and budget is arrived at.

Each of council’s standing committees works with the departments it oversees in drafting its portion of the budgets, with departments taking input from the community and councillors to develop budgets that reflect the concerns and wants of the community.

Farrell said she wouldn’t want to return to the pre-2006 days of annual budgets.

"It’s enticing to think short-term as a politician, but what four-year budget cycles do is force us to think a little bit more medium-term," she said.

"It saves time and provides certainty to our departments and civic partners, which allows them to plan their own budgets and hiring.

"I see very few drawbacks with it."

aldo.santin@freepress.mb.ca