St. Albert city council had its first opportunity to ask questions about administration's proposed 2024 budget this week, with planned spending on information technology and Lakeview Business District marketing facing the most scrutiny.
The city's proposed budget for next year, which was released late last month, comes with a 5.5 per cent property tax increase and 7.2 per cent increase to monthly utility fees.
On Monday afternoon, chief administrative officer Bill Fletcher and deputy chief administrative officer Kerry Hilts made individual presentations on the proposed budgets for the general government, recreation and parks, and emergency services departments.
Following Fletcher's presentation on the proposed general government budget, which covers various city functions such as economic development, financial services, IT, human resources, and communications, several councillors asked questions about a proposed $300,000 IT investment fund recommended for funding next year.
Fletcher said the fund would allow for as-needed technology purchases across city departments, rather than funding being approved on a project-by-project basis.
“Flexibility is a large part of this,” added IT director Joanne Graham. “The types of investments that we're making here typically fall somewhat below $100,000 each ... and they are very often enhancements to existing systems we have.”
“This fund provides funding for those particular initiatives so that as they are identified, we can proceed with implementation, as opposed to waiting for subsequent budget cycles.”
Later, Coun. Sheena Hughes asked whether the IT investment fund was a new idea, and financial officer Dianne McMordie explained council approved the fund in summer 2021, however, administration postponed the fund's implementation because of the pandemic-related need to limit city spending.
“We chose to not push that item forward in the 2022 and 2023 budget just because we were looking to manage the tax rate as best we could, but this is the first year that we wanted to start establishing that fund that council had agreed to support,” McMordie said. He added the plan is to put $300,000 toward the fund each year.
Fletcher said the investment fund would also allow for a new “governance structure” for IT, wherein representatives from several city departments will meet to ensure all city technology is compatible.
Lakeview Business District marketing
Another business case that generated some questions from council on Monday is $452,000 to hire a temporary senior economic development officer for a three-year term who will work solely on marketing and attracting business interest in the city's future Lakeview Business District.
The proposed Lakeview Business District, which will be located west of Ray Gibbon Drive and north of Big Lake, is a future industrial area covering about 243 hectares (600 acres). Council and city administration frequently cite it as the city's best opportunity to generate more commercial property tax revenue to reduce the tax burden on residential property owners.
The area is currently not serviced, and administration is currently in the process of finalizing an Area Structure Plan for the area, which, once approved by council, will allow for servicing to begin.
The city has yet to produce an estimate for servicing the area, but Mayor Cathy Heron previously told the Gazette she thinks it could cost as much as $80 million.
The $452,000 business case included in the proposed budget says the temporary staff member would receive $361,800 in salary over the three-year term, and have an annual budget of $30,000 for marketing efforts.
In response to Hughes asking whether current economic development staff could handle the work, and why the work needs to begin now if businesses won't be able to set up shop in the business district for at least another two years, economic development director Mike Erickson said there is plenty to do, and it will take some time.
“There's a lot to do,” Erickson said. “Often the branch is in a position where they have to sort of triage the work that they do [and] knowing that we're going to be bringing on a 600-acre-plus employment area and business district, we believe that this is the right time to bring on extra capacity to help with some of the work within that area.”
“If economic prosperity is one of our key priorities, we believe this is an area where investing in a role like this has the greatest opportunity to help provide return on investment in terms of that ultimate goal of generating more tax assessment.”
In response to a question from Coun. Mike Killick about whether the temporary economic development officer would look to attract businesses like Amazon, Erickson said yes. He said the position would also be responsible for trying to attract developers who specialize in building industrial parks, so once the land is serviced, the city will be able to provide interested businesses with up-to-date estimates of when the area would be ready.
“When it comes to the business attraction, typically the more complex the industry, the larger the investment, [and] the more lead time to it,” Erickson told council. Lead time refers to the planning stage for large-scale businesses.
“For large heavy-industrial investments in Alberta's industrial heartland, you could be looking at five to seven years; something like a small grocery store could be six months to 18 months; warehouse distributor could be a year to two years, so the range will vary, but yes, those larger industries typically take a lot more lead time.”
