Civic spending ‘diet’ hailed by business group

Rapid growth in municipal costs in 2000s has slowed

Some Lower Mainland cities are beginning to rein in their “out-of-control” spending, according to the Canadian Federation of Independent Business.

The business lobby group issued its annual critique of civic spending rates, which shows B.C. municipal operational spending rose 49 per cent after being adjusted for inflation from 2000 to 2010.

That’s nearly four times the rate of population growth in the province and more than twice the rate of growth in disposable income for the average resident.

But CFIB executive vice-president Laura Jones said it’s a “promising sign” that the civic spending rate only rose one per cent from 2009 to 2010.

“It’s much like the early days of a diet – it really could go either way and only time will tell,” she said. “We’re still getting closer to the edge.”

The 2012 Municipal Spending Watch report card credits Burnaby, Surrey and Chilliwack as among the most improved cities for cost control, while Abbotsford, Pemberton and Langley City and Township were the “most disappointing.”

B.C. property taxes rose 69 per cent in the 2000s to fund higher civic spending, but government transfers to cities actually went up faster – by 273 per cent over the decade – while civic fees for services like parking and licences rose 135 per cent.

The Union of B.C. Municipalities has repeatedly taken issue with the CFIB reports, arguing they are simplistic and don’t take into account challenges like government cost downloading and runaway policing costs over which cities have little control.

In the new report, CFIB calculated a B.C. family of four would have saved $4,251 over the last decade if civic spending had not exceeded the growth in population and inflation.

UBCM previously estimated that reducing business tax rates to CFIB-demanded levels without cutting spending would trigger a 14.5 per cent residential tax increase of $230 for the average B.C. home.

A provincially appointed expert panel on business tax competitiveness considered the property tax issue earlier this year but largely sided with UBCM and did not recommend government attempt to forcibly lower business property tax rates.