Tuesday, October 24, 2006

The good, the bad and the ugly on taxes and spending

The London Free Press reports that, with three weeks left before the municipal election, Mayor Anne Marie DeCicco-Best has been keeping "a relatively low profile, preferring to let her record stand on jobs, economic development and doctor recruitment as the city's construction industry rolls to another record year." This reflects sound judgment on the part of DeCicco-Best's campaign staff as her record on these issues stands safest on a very low profile indeed; but to be polite, the low profile of her record is safe with the London Free Press. Under a cursory inspection, it might be more appropriate to say that DeCicco-Best's hopes for re-election rest on letting her record stand on meager expectations and negative returns; specifically:

  • a 25 per cent increase in residential property taxes and a 50 per cent increase in water and sewer charges between 2000 and 2005, including increases of 5.9, 6.63 and 2.95 per cent in the past three years respectively;
  • a municipal debt that has climbed to $371.1 million in 2006, the repayment cost of which topped $38 million in 2004, or 5.6 per cent of the city's budget;
  • declining median family incomes in London relative to other Ontario cities;
  • unemployment that has risen from 5.5 per cent in September 2004 to 6.5 per cent in September 2005 to 7.0 per cent in September of this year; and
  • approximately 30,000 Londoners without a family doctor, despite subsidies to family physicians.
It is worth noting, of course, that construction and housing starts have flourished in London within the past few years, but this apparent success owes less to propitiatory local economic circumstance than to a national monetary policy that has created low interest rates fuelling an artificial boom in property investment, development and speculation that is soon subsiding. When one considers that assessment growth from property development has contributed over two per cent to the growth in the city's property tax revenue before property tax rate increases, the rate of municipal spending growth is seen to have far exceeded the rate of property tax increases; even this "success" is undermined by the failure of London under DeCicco-Best's administration to have capitalized on the opportunity of assessment growth revenue to limit the burden on London homeowners.
DeCicco-Best has promised to tighten the city's belt on spending, stop the brain drain, get residents to sell the city and keep the pressure on senior governments for money and new programs.
After six years of almost uncontrolled spending growth, DeCicco-Best's promises are patronizing and vague at best, disingenuous and pernicious deceit at worst. Lobbying for subsidies and grants from provincial and federal governments, much ballyhooed and promoted by DeCicco-Best as accomplishments and solutions, are neither: far from providing for sound and responsible financial management, these redistributions of tax dollars have and will continue to have bailed out the city's unrestrained spending by deferring the burden of tax collection to other jurisdictions that, in the end, take from the same pockets as municipalities. Under this kind of administration, Londoners may have to sell the city while they can still get a price for it.

Challenger in the race for least objectionable Liberal establishment mayor is Joe Fontana, who today released a finance platform that is finally much less inscrutable and more competent and cogent than his previous efforts; specifically, increases in taxes and spending of no more than two per cent annually for the next four years. While this and the other eight planks in the platform recognize the untenable tax situation in London and the economic deterrent impacts of our tax and spending burdens, throwing these issues into a starker relief that DeCicco-Best has tried instead to blur, Fontana must still be remembered as a Johnny-Come-Lately to this recognition and a candidate who began his campaign extolling his contributions to municipal financing dependency on funding from other levels of government — there has never been a shortage of Liberals willing to change their spots for political expediency. But for voters convinced that there are only two electorally-viable candidates for mayor, Fontana's re-focus may present a more palatable or even welcome proposition on election day, November 13th. For a more serious and unbelated acknowledgement and redress of London's fiscal problems, however, Arthur Majoor has proposed since the beginning of his campaign measures that do not only stop the holes in London's economic productivity but also reverse the drain, including:
  • "[a] broad based property tax cut, to put money back into the productive economy" and
  • "[r]educing spending by $100 million dollars to focus on the core aspects of civic governance."
For more information on tax cuts instead of holding patterns, read:

1 Comment:

Anonymous said...

I simply laugh at Anne Marie's so-called platform, as most Londoners know what a crock it is.
The attempt of the City to draw doctors to London is laughable. A friend who grew up in London, attended UWO and trained in London hospitals is working out of a Toronto hospital as a family physician. When my friend heard about "incentives" to come to London she figured why not return to her hometown of London? A phone call to City hall gave her no information on these "incentives". Instead she was told to call the University Hospital who had no clue as to what she was talking about. Apparently even several phone calls to city councillors and e-mails to the mayor netted no response. It seems that City Hall has no idea how to act upon the so-called promises the mayor has made, nor do they have any desire to help a doctor who wanted to move to London to practice. With everything I've read in the LFP, I wouldn't have believed the City was making finding out any information so difficult, had I not been a friend with this woman since the 1970's.
As far as I'm concerned Anne-Marie is all about political posturing and very little substance. She should actually have to prove in a measurable way that she has improved the city.
On a side note, I saw Joe on the news last night claiming the Harper government was showing disrespect to the city by holding a by-election so close to our municipal election. Is this because you want the MP seat for your friend who is too busy helping you get elected Joe??? None of the other political groups seem even remotely upset by these events, could it be because now Anne-Marie won't be able to run for the Liberal seat even if she doesn't get in as mayor. It has been suggested that the plan was for the two to literally change seats.