Wednesday, May 3, 2006

Fiscal responsibility, London-style

As reported yesterday, council voted Monday not to re-open the 2006 budget and pass a 3.9 per cent hike in residential property taxes. Mayor Anne Marie DeCicco and most councillors opposed re-opening the budget to provide tax relief from "surplus" money earmarked for debt reduction.

"You don't borrow from the future to pay for today," London Mayor Anne Marie DeCicco said.
It's very noble of DeCicco and council to act on our behalf in the cause of fiscal responsibility — especially when the approved 2006 capital budget includes $30 million in new debt financing. Total corporate debt at the end of 2005 stood at $371.1 million, or over $1,000 per resident.

Councillors who argue that it is irresponsible to give that money back to taxpayers are in effect saying that it's their money now. The defeat of the proposal to re-open the budget and provide tax relief out of debt reduction projections prompted this exchange as reported in the London Free Press:
Controller Tom Gosnell and Coun. Paul Van Meerbergen suspect some on council prefer debt relief to tax relief so the city can be in a position sooner to borrow millions to build capital projects, including a performing arts centre.

"(London's) Creative Cities task force wanted half of any surplus to be set aside for a performing arts centre," Gosnell said yesterday.

The head of the task force, Controller Gord Hume, said there's no merit to any claim his vote had anything to with a performing arts centre.

"To think I would do (that) is totally, completely and utterly ridiculous. The thought never crossed my mind," Hume said. "My action was driven solely by doing what's in the best interest of taxpayers in the long run," he said.
As a member of the council that between 1999 and 2003 borrowed $500 million to spend on capital projects, Hume's defense is at best altogether belated if not entirely disingenuous.