Morinville middle of the pack of province’s overspenders, CFIB say

by Colin Smith

Not the best and not the worst, Morinville is in the middle of the pack in Canadian Federation of independent Business rankings of what it terms municipal overspending.

However, Morinville was ranked substantially worse than several neighbouring municipalities in the federation’s recently released Alberta Municipal Spending, 2015 report.

The report, prepared by federation intern Ashley Stedward, gives the province’s municipalities a numerical ranking from 1 to 180. The higher the number, the worse the municipality is considered to be overspending. Morinville gets a score of 90, which compares with 78 for Redwater, 67 for Sturgeon County, 57 for Gibbons, 53 for Bon Accord and 38 for Legal.

The report claims that municipalities overspent by $13.8 billion since 2003, and $2.9 billion in 2013 alone.
They declare that “excessive spending” cost households $2,039 in 2013 alone and a total of $9,955 since 2003.
These numbers are based on the concept that sustainable government spending involves holding operating spending in line with population and inflation growth.

According to the report municipal operating spending in the province increased by 82 per cent from 2003 to 2013, compared to population growth of 24 per cent.

Direct taxation by municipalities has also increased by 109 per cent since 2003, the report states.

Half of municipal operating spending across Alberta was allocated toward salaries, wages, and benefits.

The report offers a number of recommendations for municipalities and the provincial government.

The report urges municipalities to restrict spending increases to the rate of population growth and adopt “sustainable wage growth” policies. They should also allot contingency funds to deal with the risk of natural disasters.

Recommendations to the Alberta government include rejecting calls for new taxation powers through city charter agreements and creating a municipal auditor general to conduct performance-based audits for municipalities.

“The effects of municipal overspending involve all taxpayers, not just businesses, as municipalities examine the possibility of tax increases,” states the report’s conclusion. “If local governments are serious about minimizing tax increases on property owners they should focus on spending restraint.”

Morinville’s Mayor Lisa Holmes did not respond to a request for comment on the report.

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