– by Jim Hutton

In my previous correspondence I outlined the magnitude of the challenges facing you in this new term. For the past 20 years previous councils allowed city expenses to incrementally grow at a rate well above inflation to a point where they are now disproportionately high relative to our population.

Strathroy has a population of 23,871 compared to Owen Sound’s population of 21,612. I pointed out that in 2020 Owen Sound spent $25.9 million on salaries and benefits while Strathroy spent only $14.2 million while also providing their own police and fire protection. This discrepancy is reflected in the significant difference in the cost of services for these two municipalities. For example, Owen Sound spent $4.6 million on General Government services in 2020 while the larger municipality spent only $3.2 million.

One question you should be asking is why does it cost Owen Sound $1.4 million more, to provide General Government services? John Tamming once pointed out to me that our city has three City Clerks, when most cities do quite well with only one City Clerk. How pervasive is the type of thinking that got us ‘three City Clerks’? The difference in the cost of providing General Government services, $1.4 million, suggests that it goes well beyond ‘three City Clerks’ within the General Government Services department.

The discrepancy in expenses, between the two municipalities, does extend beyond the Government Services department. It continues into each and every expense line item in the audited financials. I encourage you to examine the audited financials for both municipalities for yourself. Perhaps you can get access to the audited 2021 statements, since they are not available online.

Once you review them, I suggest you apply your own critical thinking and analysis to determine for yourself whether or not there is ample justification to continue these expenses at the same levels.  If you agree with my analysis, that our staffing levels at city hall have grown well beyond what they should be, to manage a city of our size, then you are in a position to make the changes necessary to ‘right size’ the workforce to at least match that of the larger municipality of Strathroy.



Growth - Time for a Change in Approach

Over the years past Councils have adopted several different strategies aimed at stimulating growth and reducing taxes through an expanded tax base. A few years ago, I had the pleasure of serving on the Mayor’s Growth Committee that adopted the very unrealistic motto of “30 by 30”, meaning an Owen Sound population of 30,000 by 2030.  Neither this, nor the many other initiatives attempted over the years have worked.

It’s time for this new Council to do things differently. It’s time for Council to focus on getting its ‘books in order’ by aggressively getting expenses under control so taxes can be reduced. If you focus on reducing taxes, to a point that they are competitive with our surrounding municipalities, then growth will happen organically. When commercial and residential tax rates are lowered, the migration to neighbouring municipalities will cease and jobs and population will begin to grow.

You’re Not Alone

Past Councils have relied on community input in the form of standing committees which have been successful in providing a community perspective on routine operations. The other source of input and analysis that councils routinely turn to are costly consultants.

One resource that Councils have rarely tapped into is the population of professionals who have chosen Owen Sound as their retirement community. Unlike those who volunteer for Standing Committees, most retired professionals are not available for long term or ongoing commitments.

However, this group can be a great free resource that Council can activate for advice, consultation or to address specific problems facing the city.  All that is required is for Council to advertise the need and identify the specific credentials, knowledge and experiences required.


Encouraging Greater Public Participation

The formality of the current council meetings is not designed for meaningful interaction with the public. Those that do participate in the public question period are the more vocal members of the community who do not hesitate to share their opinions.

However, the format is not welcoming to those who see the process as intimidating and shy away from sharing their views. There is a wealth of information out there among those that hesitant to share their views in a formal setting.

To tap into this resource, I suggest that Council consider changing one council meeting per month to a more informal ‘Town Hall’ type gathering to increase community interaction. This meeting should not take place in the council chambers but rather in more neutral environment that encourages discussion and is managed by a neutral moderator to ensure the microphone is not dominated by the loud voices.

You don’t need to hear from people like myself who don’t hesitate to ‘tell you what they think’. You need to provide this inviting, informal, safe environment to tap into the many voices out there, that know what they expect from their Council, but are reluctant to share their opinions in the current environment.  


Protecting the Unhoused during the Winter

The second and perhaps the most immediate challenge you will be facing is our growing homeless population. You heard during the election that some are afraid of being approached by the homeless downtown and merchants have reported their property is being frequented by the addicted leaving drug paraphernalia for the merchant to clean up.

You know intuitively that meaningful Riverside growth will not occur until there is a permanent solution to homelessness. You heard an appeal from a fellow candidate for establishing temporary washrooms and winter housing for the homeless until they are all housed.

The County is the lead agency when solving this problem. However, you heard during the campaign that residents expect their city to also play a direct role in the solution. There were suggestions that the city could augment the County’s efforts, for example, by opening up the enclosed marketplace stalls for nighttime refuge during the windy winter nights and installing portable washroom facilities nearby.

A more permanent winter solution is to use the over-appropriated funds in the Transit budget to purchase the same mobile housing units that Charlottetown purchased this year. Owen Sound could purchase eight to 10 units with the surplus Transit funds and install them in the Harrison Park or Kelso Beach campgrounds, where there are hookups for power, water and sewer. The units could be removed and stored off site during summer months, so they don't interfere with recreational camping.

These are just a couple of the little things that Council can do immediately to help out, that will be greatly appreciated by those currently without housing in our community.  This can all be achieved with no new costs to taxpayers, particularly if you reach out to the community for volunteers and donations.

The Road to Recovery

In a previous communication I gave you my thoughts on the steps that I believe Council should take to put the city on the road to recovery. If there is a real appetite on the new Council to turn things around, these 10 steps will prove essential, beginning with step number one – developing a Five Year Plan.

For those who may have lost these in the confusion of the campaign, I’ve included them below and posted them on my website at www.OwenSoundTaxes.com along with a scorecard to measure progress. 
 

Ten Steps to Owen Sound’s Recovery

1. Five Year Financial Plan: Develop a five year financial plan with the goal of reducing taxes by 2% per year until Owen Sound's taxes and expenses are relatively equal to similarly sized municipalities. This should include a Change Management Plan and a Communication Plan to ensure city staff remains engaged and focused on restraint.
2. Budget Vetting: Modify the job descriptions for the city manager and all senior staff to explicitly include the scrutiny and approval of all budgets submitted by their direct reports with a view to ensuring that the need for any requested increase is well documented and does not exceed the rate of annual inflation.
3. Change the Budget Process: Roll out a Zero-Based Budgeting process. Instead of new budgets developed using the past year's budget as baseline. Each new budget is built based on the assigned activities for the year. Each and every expense must be fully justified. You can review this process here: Zero Based Budgeting (ZBB).
4. Fully Burdened Cost Centers: Council must introduce Fully Burdened Cost Centers. Council and taxpayers deserve to see all costs associated with each department which includes an allocation of all support services such as IT, HR, Finance, Building Maintenance and most importantly the amortization expense for all capital expenditures for each department or cost centre.
5. Restrict Budget Transfers: Enforce the concept of Restricted Funds and provide clear rules to eliminate the ability for budget managers to use funds on activities other than the reasons the funds were appropriated. For example, if Transit appropriates funds to cover the bus contract costs, as it did this year, the budget manager cannot use these funds for anything other than the bus contract.
6. Budget Committee: Action Scott Greig’s idea for establishing a Budget Committee with the authority to send back draft budgets for reevaluation. Council needs to tap into the community and encourage seasoned business professionals to volunteer for this committee. Ideally membership should consist of two councilors and three Owen Sound residents with knowledge and experience in business and financial management.
7. Learn from the Mistakes of Past Councils: Council needs to conduct financial audits of Transportation Services and the Tom Thompson Art Gallery with a view to identify the sources of a 79.9% increase in the transportation budget over 9 years and a 77.3% increase in the Art Gallery budget over four years. Learning why these extreme increases happened and what the council of the day could have done to prevent them will assist the new council to identify the early signs of similar problems. Study the mistakes of the past so not to repeat them in the future.
8. Administrative Accountability: The new council must hold the City Manager accountable. It is his responsibility to manage city expenditures in a cost-effective and financially responsible manner. It is also his job to ensure that draft budgets are adequately challenged and revised on their way to the council table. He must personally complete a detailed review of each draft budget when they make their way to his desk to ensure that each requested increase is fully supported with documentation and does not exceed the rate of inflation. This Budget Year we saw the City Manager request a 71.9% increase to his budget at a time when city growth has been virtually stagnant for many years. He should be setting an example of “restraint” not “extravagance”.
9. Transparency is Essential for Recovery: The new council must improve transparency at city hall by including an FTE spreadsheet, and a spreadsheet of current contracts, broken down by department with the annual financial statements. The FTE Spreadsheet should include the previous year’s data so residents can see the changes in the workforce year to year. In addition Council must direct the city’s auditing firm to include statements of operations for each department, in its annual report and include descriptions of all expenses listed under titles of "Contracting" and "Legal and Contracting".
10. Listen to the People: Residents have been very vocal in identifying two major concerns, high taxes and those among us without housing. Therefore council must earmark annual savings for tax reductions and increased support for Owen Sound's homeless.

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