City Hall Dumpster Fire
Following years of scope creep, rapidly rising payroll costs, increasing headcount, and out of control employee expenses, the City of Vancouver is now at risk of bankruptcy and asking for a bailout. Mayor Stewart says the city is losing an eye popping 4-5 million per week. How did we get to this point?
Unfortunately, Mayor and City Council and the previous Vision-lead Mayor and Council disembarked from a focus on delivering quality core services to city residents. Instead, they chose to pursue various pet projects and purely political objectives while allowing labor costs to push higher, thereby placing the city on an unsustainable fiscal trajectory. Over the past decade labor costs (the largest operating expenditure) rose 21% faster than inflation. Over that same decade employee expenses doubled, while the city’s population grew by just 10%.
In addition to payroll costs rising too quickly, headcount has also been rising unsustainably in some departments. One especially egregious example of this is the communications department. Under former NPA mayor Sam Sullivan there were just 7 communications staff, today there are 43 - that is a 514% increase in just over a decade. Is there a single department at City Hall whose headcount has grown at or below the city’s population growth rate this past decade? City hall is a dumpster fire.
Finally, we must talk about defined benefit pension plans. These cushy pensions provide guaranteed payments to retired workers no matter the costs. This creates an uncertain, ongoing, and growing liability for taxpayers to shoulder. Moving forward, all CoV hires should be placed on defined contribution pension plans, in which the money to pay the pensions is limited and the city has no obligation to top up the plan. This is the financially responsible choice to make.
Homeowners and small businesses face serious financial distress and bankruptcy while privileged public sector workers are continuing to enjoy wage increases from legacy collective bargaining agreements, extended vacations, defined benefit pensions, and a myriad of other perks. It is completely unacceptable for the public sector to continue enjoying this lifestyle funded by ratepayers who are struggling to make ends meet. This is a time for belt tightening across the entire city.
The City of Vancouver’s own survey shows 45% of households “can’t pay their full mortgage next month” and 25% “expect to pay less than half of their property tax bills this year”. Residents need an immediate tax abatement to help them through this economic crisis and the public sector must share the burden. Collective bargaining agreements must be negotiated for the new realities of our time.
More than ever it’s critical homeowners and small businesses band together to form a strong and united voice calling for a focus on core services, sustainable labor costs, reasonable rates of taxation, and responsible use of public funds by Council.
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