Editorial Viewpoint

Windsor City Council 2018 Budget Should Enhance Cynicism

Windsor City Council 2018 Budget

Photo: One result of this fatally flawed process was the allocation of only $300,000 for the second phase of the Via Italia streetscaping when it would take $2.4 million to do it right. Photo courtesy of the Erie Street BIA.

Windsor City Council 2018 Budget Should Enhance Cynicism

by Alan Halberstadt

The Windsor City Council 2018 election year budget, struck in mid-January, set off an outpouring of self-congratulation. If this was a professional hockey team, there would be a rash of announcements of upper body injuries disguising dislocated shoulders acquired by Councillors robustly patting themselves on the back.

The object of this adulation was a $22.8 million “enhanced capital budget” which divided the loot among the pet projects of Windsor Mayor Drew Dilkens and 10 cloying ward Councillors.

A number of these investments are arguably worthwhile. My personal favourite is the final phase of the long-delayed Via Italia streetscaping. Unfortunately, the Erie Street BIA has been waiting for the $2.4 million second phase, from Parent Avenue to Lincoln Road, for a good decade, and the $300,000 allocated will not nearly cover it.

The bottom line is that the vast majority of these wish lists could be classified as not “have to do,” but “want to do” such as Dilkens’ baby — $1 million for Peche Island, including the purchase of a boat.

And the vast majority of the projects are ward specific baubles to please squeaky wheel constituents heading into October’s election.

Most pertinent to this debate is the source of the $22.8 million. In fact, if City Hall finances were being managed in a prudent, responsible fashion, there would be no enhanced capital budget for our municipal politicians to raid.

The politicizing of the capital budget process started in earnest in 2013 when former Mayor Eddie Francis hijacked $10 million from the fifth and final year of the multi-year capital budget of the day, 2018, and doled out $1 million to each of the 10 ward Councillors.

Chris Vander Doelen, then a Mayor-worshiping Windsor Star columnist, described the Francis ploy as less-than-transparent trickery and a shell game, using the age-old political practice of “pull ahead” spending that is hard to understand for most taxpayers.

For the record, I was one of the Councillors who went along with the Francis largesse. Either I co-operated or my ward was left behind.

City Hall’s top financial officials don’t recommend this risky business, preferring that $10 million in the final year of each multi-year capital budget remain unallocated as a contingency for high priority City Council projects which are not currently funded, or to be used to match senior government grants that may be announced in the future.

The province has legislated that all municipalities move towards a 10 year capital planning period, starting with the addition of the sixth year in 2018 and culminating in 2023. This is designed to improve long range capital planning.

In presenting the budget in January, administration recommended that pre-commitment spending continues to be limited to the traditional five year period, notwithstanding the gradual phase in of the 10 year planning period.

Council didn’t heed that advice. In fact, Dilkens more than doubled down on the pull ahead gambit, boosting the enhanced capital budget to the aforementioned $22.8 million, exploiting the extension of the five year capital planning period to six years.

To arrive at $22.8 million for political goodies in an election year, Council pulled $10 million in normal unallocated funding from the 6th year of the capital budget (2023), and $6 million in funding resulting from the additional annual $1 million in funding transferred to the capital budget from the operating budget covering years 2018-2023, and directing the profitable Windsor Airport to pay $6 million of its own capital projects.

Dilkens yanked the remaining $800,000 from proceeds of the recent sale of the Canderel Parking Garage. The Mayor is adept at plucking money from various budget rabbit holes to satisfy his edifice complex that has seen him whip the Council vote to fund pets such as the $750,000 refurbishment of an ancient streetcar, high-end sculptures of legendary dead men, and erection of a $400,000 Christmas tree.

The city applauds itself on the very successful Pay-As-You-Go approach which has saved tens of millions of dollars in interest costs, drastically lowering the long-term debt and allowing self-borrowing from healthy cash flows to fund capital projects.

The Francis regime likes to take credit for this strategy, failing to mention Roman Martiuk, the Godfather of Pay-As-You-Go.

Martiuk was hired away from Belleville in 2004 to become Windsor’s Treasurer and clean up the fiscal mess created by the disastrous MFP leasing scandal. He is now Chief Administrative Officer of the Town of Whitchurch-Stouffville, a fast growing town of 49,000 on Toronto’s outskirts.

He recollects how he launched a debt management plan in the spring of 2005. The key pathway to fiscal health was to unload some 50 leases.

Leasing is a very expensive way to borrow so we got out of the leasing business,” he recalls.

Martiuk also halted the insanity of issuing five year debentures for basic infrastructure jobs, restricting borrowing to five big ticket projects financed by long term debentures.

He convinced department heads to live within their means.

My philosophy is don’t spend money you don’t have,” he states.

The much-travelled Martiuk left Windsor in 2007 to become CAO in Prince Albert, Sask. When I asked him to comment on Windsor Council’s pull ahead habits, he declined, instead making the general statement that “there is no free lunch.”

It’s noteworthy that Council rejected all but a few recommendations to hire 39 people to meet growing operational service demands identified by administration. Instead they transferred $6 million to the enhanced capital budget and limited the election year tax increase to a politically symbolic 0.9 percent.

Council also grabbed a special $1 million dividend for 2017 from the ratepayer-funded EnWin Utilities to help pay for the holiday lights display.

All in all, a very cynical, short-sighted budget.

The opinions expressed by Alan Halberstadt are not necessarily those of Biz X magazine or its advertisers.

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Alan Halberstadt
Opinion Editorial. Alan Halberstadt is a career journalist who served on Windsor City Council for 17 years before deciding not to run for re-election in 2014. Alan Halberstadt believes all businesses share a common interest in how governments spend tax dollars. The emphasis of his columns is to expose and comment on the political gymnastics and taxation excesses of bureaucracies. As a former Windsor City Councillor he has a particular insight on how local municipal governments function or not. Opinions expressed by Alan Halberstadt are not necessarily those of Biz X magazine or its advertisers.