Budget 2023-26 - Early Thoughts

Updated: 6 days ago

City Council is now fully in the swing of budget season. The proposed operating, capital, and utility budgets have all been released, and the City has also revealed its first ever carbon budget.


I’ve been poring over all the budgets in recent weeks and taking in all the feedback that constituents have been sharing. For me, this is the culmination of all the discussions I have had with folks across Ward Métis over the past two years. Budget is how we turn those discussions into action.


It’s a tough budget. That’s almost cliche at this point, after years of economic disruption, a global pandemic, provincial funding cuts, inflation and rising interest rates. But...it’s a tough budget, and just like many households are doing right now, Council will need to make some tough decisions. After years of cost-saving measures and tax increases well below inflation, we are looking at a 3.9% tax increase in 2023 to keep providing City services, operate newly built infrastructure, and increase vibrancy in Edmonton’s core.


There are many worthwhile projects in the proposed budget. But fundamentally, as proposed, I do not believe that it will provide an adequate return on investment, especially in key areas like affordable housing, community safety and wellbeing, and climate action.


While City Administration has come forward with a proposed budget, there is still a long road ahead of us until it is finalized. The next step will be a public hearing on November 28 and 29 – you can sign up at edmonton.ca/meetings. Following this, Council has over two weeks to bring forward amendments for debate and voting before finalizing the budget.


To strengthen our return on investment, we will need to align our budget to key priorities and leverage provincial and federal funding opportunities to amplify our impact.


Affordable Housing

Affordable housing is the number-one issue I have heard while door knocking in Ward Metis, and the City’s budget survey backs up that importance. However, funding for affordable housing is currently set to drop off a cliff in the proposed budget.


Continuing the Affordable Housing Investment Plan will require at least $18.7 million of permanent, ongoing operational funding, and $91.7 million in the capital budget. These critical investments are currently unfunded in the proposed budget, and I will be working hard to make sure they are included alongside other supports that uplift vulnerable and marginalized neighbours.



Getting the most out of every dollar will require us to be open to partnerships with other orders of government who are not as fiscally constrained as municipalities. While affordable housing is mostly a provincial and federal responsibility, the City has shown that we play an important role.


In the last budget cycle, every dollar we invested in affordable housing leveraged four dollars from partners. And we know from Canadian studies that investments in affordable housing can lead to a double or triple benefit to society, individuals and governments.


We can see that investment at work in creating healthier communities and business districts that can attract new capital. We can see that investment at work in reducing strain on police, allowing them to respond quickly when needed. The province can see that investment at work in the health care and justice systems, for which affordable and supportive housing reduces demand. That is a massive economic return on investment, in addition to being the right thing to do. We need to have projects shovel-ready to leverage available funding so that we can continue to be a leader in addressing housing and homelessness.


Climate Action

Similar to affordable housing, climate resilience and the Energy Transition Strategy is largely unfunded, even when 70% of Edmontonians tell us that they want to maintain or increase City action on climate change.


Continued municipal leadership is needed when it comes to climate action, particularly with respect to key levers like land-use, transportation, and development. We need senior orders of government to continue to lead a society-wide effort, but the Energy Transition Strategy passed by the previous Council makes it clear that we can be climate leaders and secure Edmonton’s environmental and economic resilience.



If we pass the proposed budgets, we will not stay on track towards our climate goals. The carbon budget shows that if we do not change course, we will blow our 2050 emissions reductions targets by 2037. Leaving climate unfunded would derail all the work we have done to this point.


Some key climate actions sitting unfunded include our district energy strategy, home retrofits and solar rebates, our fleet transition, bus rapid transit planning, bike plan implementation, and the implementation of our Energy Transition Strategy. I will be looking for ways to make room in the budget for urgently needed climate action.



Even with intergovernmental dollars expected to help us get the most out of investments on housing and climate, our own financial contribution will still be significant. To pay, we need to take a really hard look at new spending that is not as aligned with key priorities, and I believe we will need to re-allocate some existing spending as well. We will need to be focused and avoid spending that is not essential. This is a time for focus and fiscal discipline, not for more mega-projects or spending that does not deliver a high return on investment in alignment with the welcoming, inclusive, healthy, and climate resilient communities we strive for.



City Services

Edmontonians are dealing with rising costs and economic disruption. While we need to continue to become more cost-efficient, we can’t cut Edmontonians off from services they rely on and expect, especially those necessary for economic recovery.



We need to continue to maintain our infrastructure, fund core services like public transit, support safe communities, and invest in programs and services that uplift all Edmontonians. From snow clearing to public parks, emergency services to waste collection, people expect to see their tax dollars at work. Delivering these services and ensuring Edmontonians are able to access them is a critical component of building an equitable, affordable, and liveable city.



I am conscious of the impact budgetary decisions have on affordability. There’s a balance at play and it’s important to think of affordability in a holistic sense. Oftentimes the people most affected by cost increases are the same folks who rely on public transit to get to work; they rely on programming at our libraries and recreation centres for their kids after school.


Trying to avoid property tax increases at all costs will only lead to a constant decline in services, hampering our economic and social resilience.



Service Delivery

We need to continue improving Edmonton’s financial efficiency in order to get a better return on investment. In the short term, that means continuing to find cost-savings where appropriate. In the long run, it means following through on the City Plan to get to a more fiscally responsible state.


Since 2015, the City of Edmonton has found $300M in annual savings through efficiencies. That is an impressive figure. While significant savings have been realized, there are real limitations to how far this approach can take us. It is unclear just how much efficiency is readily obtainable and I am open minded to these discussions, but I also know that we must protect the services Edmontonians love and enjoy that bring value to our communities, especially as we look to foster connected, amenity-rich, 15-minute communities across the city.



Smart Planning

At a systemic level, we also need to shift towards a more dense, infrastructure-efficient city. We are currently experiencing the costs associated with decades of urban sprawl and low density development patterns. The City of Edmonton has $31 billion of infrastructure, and we are falling short on maintenance and renewal by $470 million annually (for context, that would represent a startling 27.4% tax increase based on the 2022 budget).


On average, 9.1% of our assets are in Poor (D) and Very Poor (F) condition. Those are the ones people contact me about. Right now, 60 percent of the portfolio is rated in Fair (C) condition, but unless we fill this gap, over the next five to 10 years, half of those assets will be in D and F condition. Everything from roads, to rec centres, pools, parks, affordable housing, buses, LRTs, and more. This wave of renewal needs is ultimately the true cost of our sprawling growth pattern.


Simply put, we have built a very expensive city to maintain. If we want a better return on investment, we can’t keep investing in the status quo. Instead, we should be making targeted investments that will keep us on track towards the City Plan goal of two million people within our existing boundaries.



This includes following through on projects like Zoning Bylaw Renewal and District Planning, our Economic Action Plan, Mass Transit Plan, and much more. If we can stay the course, and realize the savings of City Plan, we will save money and avoid costly waves of renewal needs like the one we are experiencing now.


Up Next

This blog barely scratches the surface of the complexity and considerations involved in the budget process. For the sake of brevity, I've had to exclude enough content to make another multi-hundred page budget document.



Over the last two years I've been on the doors, at City Hall, and in community halls engaging with Ward Métis. Most discussions I have had are ultimately budget conversations. A city's values, priorities, and aspirations are found in its budget. I have been listening carefully, and I know there are so many important capital investments and services that deliver value for Edmontonians, that they would like to see maintained, enhanced, and introduced.


I will be working hard to ensure our budget responds to the realities we are currently facing, while positioning us for a more equitable, inclusive, prosperous, and climate resilient future.


If you want to share your budget feedback and priorities with me, please feel free to email me ashley.salvador@edmonton.ca.


 

Bonus Interview: Global News Morning Edmonton

City councillor answers questions about Edmonton's budget deliberations.








JOIN US TODAY

  • Facebook
  • Twitter
  • Instagram

Join our mailing list to receive campaign & election updates, reminders & instructions on how to vote, & opportunities to get involved.