Nenshi comes out swinging against UCP budget

Mayor Naheed Nenshi had strong words about how the long-awaited provincial budget would impact Calgarians after it was finally unveiled on Thursday. 

Budget breaks promises, introduces regressive tax, angered Nenshi says

Mayor Naheed Nenshi responded heatedly to the UCP's budget on Thursday, saying, "We'll continue to find efficiencies. We always do. But this is going to be tough." (Helen Pike/CBC News)

Mayor Naheed Nenshi had heated words about how the long-awaited provincial budget would impact Calgarians after it was finally unveiled by the UCP on Thursday. 

Nenshi told reporters in a Thursday press conference that he had prepared a statement on the implications of the budget, and warned it would be "lengthy." 

"First of all, let's start with the good news," Nenshi said.

Then, he allowed silence to stretch.

"Okay, so, let's move on to the not-as-good news, and then we'll get to the bad news," he said.

Operating budget 'relatively protected'

There were elements of the UCP's 2019 fiscal plan that Nenshi said weren't as negative for the city as others. 

For instance, he expressed that he was grateful that support for low-income transit has been extended by the Alberta government.

"Our mandate is to support the most vulnerable, and we'll continue to try to do that," Nenshi said. 

"And certainly this funding — while it doesn't get us all the way we need to go — it is much appreciated by us and by those low-income users of the pass."

Nenshi said he was "also pleased" that the budget reflected  the UCP's platform commitment to provide funding for mental health and addiction services.

The budget includes increases of $100 million for a mental health and addiction strategy.

"That [funding is] important to me, but it's [also] important to the City of Calgary, and our work to create a community strategy on mental health is a cornerstone of my third term as mayor," Nenshi said.

With an acknowledgement that the policing grant was also relatively maintained, the city's operating budget was relatively protected, Nenshi said — except for "two interesting things."

The 'bad news' according to Nenshi

Those "interesting things" involve property taxes, and according to Nenshi, Calgarians should be steeling themselves to pay a whole lot more.

"The province's requisition for 2019 for the education portion of the property tax — which I remind you is a provincial tax; the city is just the collector — it was actually $15.5 million more than last year. So, the province has made a massive increase to your property taxes," Nenshi said. 

"They've increased it by about one per cent overall, across all residential and non-residential properties, roughly. So you're going to have to pay that."

Because Calgarians have already paid their property taxes for this year, Nenshi says they can expect next year's property taxes will be even higher.

"It's a bit surprising that a province that's prided itself on cutting taxes has actually increased the most unfair, regressive tax that every person has to pay."

The second "interesting" issue Nenshi wanted to draw the public's attention to is that the Ministry of Municipal Affairs announced a 25 per cent reduction in the Grants in Place of Taxes program in 2019-20, and a further 25 per cent reduction in 2020-21. 

The total projected savings by the UCP are $81 million over the course of four years.

But according to Nenshi, it essentially means the government is not paying its taxes. 

"They have chosen to just stop paying part of their own property tax. Boy, I wish I could do that!" Nenshi said.

Then: "No, I don't, because I believe in funding the city's services."

The result in the cuts to the program, Nenshi said, is that Calgarians will be making up the difference.

"With two months to go in the fiscal year, we've got to find $17.5 million," Nenshi said. "[It] means all the rest of us have to make up for that tax that they're not paying."

'That's a promise broken'

The most heated moment of the conference arguably came when Nenshi said he wanted to discuss the YYC Matters Spring 2019 edition.

The survey is released to political parties ahead of federal and provincial elections to gauge where they stand on issues that affect Calgarians.

In it, the UCP pledged to uphold a funding agreement called the City Charter's Fiscal Framework Act, and Nenshi recited that pledge.

"'The United Conservative caucus voted for the City Charter's Fiscal Framework Act in the fall legislature sitting, and will respect the multi-year funding in that agreement,'" Nenshi read.

"That's a black-and-white promise."

With that, Nenshi crumpled the paper that he read from into a ball and tossed it. 

"And that's a promise broken," he said.

The cities of Calgary and Edmonton have given up "approximately 40 per cent" of their funding in the existing financial framework, Nenshi says, and are now being subjected to a further nine per cent cut. 

It's "on the same basis as all the other municipalities who didn't take a 40 per cent cut," Nenshi said.

"Despite our desperate needs for roads, bridges, and social infrastructure, we're being singled out to take a much larger cut than every other municipality in the province."

It's a move that could put city council against the ropes.

With money designated for maintenance and development projects now vanishing, Nenshi says "tough conversations" will be necessary to determine what goes forward.

"Every dollar that we had been promised, that had been agreed to, has already been allocated for fixing potholes, for building bridges, for buying buses, for filling out social infrastructure," Nenshi said. 

"So clearly, cutting this even further means some of those things aren't going to get built. And my colleagues on council and I are going to have to have some real tough conversations about what is going to go by the wayside."

Budget puts flood mitigation, Green Line in jeopardy

The mayor's grievances didn't end here.

Flood mitigation funding has been cut — to the tune of about $30 to $50 million, "depending on how they are going to calculate it," Nenhi said.

Regional infrastructure has taken a hit of $50 million, and the Green Line is now a "big problem," Nenshi says. 

The city was supposed to receive $555 million for the planned LRT over the next four years.

Nenshi, seemingly incredulous, told reporters it will now receive $75 million.

And according to the mayor, its 20,000 construction jobs are now in the balance.

"I don't know how you complete the Green Line on time, [and] we certainly don't have the debt capacity," Nenshi said.

"I don't think it's too much to say the project itself is in jeopardy."

Nenshi says that even though the budget's steep post-secondary cuts fall outside the realm of municipal issues, it compromises the city's future by compromising its talent pool.

"The 'Calgary comeback' means universities and colleges have to be able to do a great job to answer that talent question, and certainly there is a lot of improvement needed," Nenshi said.

The takeaway?

Nenshi says city council is going to do what it can to work with the budget, but it's anticipating a challenge.

"We'll continue to find efficiencies. We always do," Nenshi said. "But this is going to be tough."

With files from Helen Pike