By Chris Pettingill
Published: June 10, 2015
FAIRLY recently, the District of Squamish released its, “Annual Report.” This report gives everyone a chance to see what Squamish accomplished in 2014, and also where it is headed in the near future. With many kids bringing home report cards this week and last, it’s somewhat fitting for us to be getting a report card for the District too. Unlike a typical report card, this one is largely a self-evaluation. Although that is likely to make some question its objectivity, the District knows best what it has been up to. So how does our District think it faired in 2014?
The annual report certainly makes it seem like we’re doing well. Although it doesn’t give itself a letter grade, it reads as if we’ve gotten an A, or even an A+! With the bombardment of spin and PR we’re faced with these days, it’s hard not to be at least a little cynical about a report as positive as this one. Yet, a positive attitude is a major factor in one’s success, so it’s hard to fault the District for publishing something so sunny. And with the way things are in Squamish right now, I may need to set my cynicism aside anyway. My own personal experience is that Squamish is bursting with energy, hope, and excitement. I’ve been here just under six years now, and in just that short time, Squamish has gone through an impressive transformation. When you walk around and talk to people, you notice that something good is happening.
I’m not suggesting that everything is perfect. We know that housing and homelessness are issues here. That is something not covered much in the report. Squamish has adapted to a new economic model much faster than other communities. This is both good and bad. Other communities that also lost their industrial base are still struggling to find a new workable economy, while Squamish has seized many new opportunities. As much as Squamish needed to find a new path, the transformation has happened at such a rapid pace that not everyone has been able to adapt. Not everyone feels like there’s a place for them in the evolving Squamish.
In fairness to the report, quantifying the above sorts of challenge is not simple, but it is probably worthwhile to acknowledge these things. This brings me to one of my criticisms of the report. There are a lot of numbers in the report. And there’s also a fair bit of descriptive information about what Squamish set out to do, what it did do, and what it wants to do next. All of that is fine, but additional context would add a lot of meaning.
For example, the report says that Squamish’s unemployment rate is 6.2%, but I’m left wondering if that’s good or bad? In 2014, that was the unemployment rate for our region, but our region had a slightly higher rate than the rest of BC. Comparing ourselves to the rest of our region, or BC, or Canada is one way to try to evaluate such a number. Maybe more relevant though, is whether our unemployment numbers are getting better or worse. Better yet, what was our employment rate goal, and did we exceed or fall short of our goal? At the end of the day, comparing ourselves to our neighbors or our past is interesting, but what matters most is whether or not we’re getting where we want to go.
The descriptive items in the Annual Report do a better job of outlining our goals, and what we actually achieved. My preference would be to translate these into numeric indicators that are objective and measurable. That makes it easier to compare and track progress. We look at our community across a few key domains that include Building a Strong Community, Respecting the Environment, and Growing our Economy. We should be able to roll up the various indicators within each of these domains to give ourselves an overall score for each.
Maybe it seems like I’m nitpicking the report, but there are important reasons beyond just this report to think about having more objective ways to monitor our performance. Comprehensive and objective monitoring makes for stronger accountability. The more that Council has to rely on subjective tools to monitor performance, the more they are forced to micro-manage staff. Unfortunately this drives up our costs, and also means we’re not able to take full advantage of the skills of our municipal staff.
I know that our municipality is working on getting more comprehensive objective measures and targets in place, and the Annual Report demonstrates progress. We have hard numbers for some of what we achieved, and we have subjective descriptions for some of our goals. We just need to make sure both our goals and achievements can be expressed objectively and comprehensively. Although this sort of thing is not typically top-of-mind for the average person on the street, it is something that should be a priority.
Because we are still working on defining our goals more objectively, it’s a little hard to figure out if we’re, “on track”. The report surely implies that things are going well, and I already touched on the fact that there’s a perceptible positivity in peoples’ attitudes.
Western societies and current generations are sometimes criticized for living beyond their means. Let’s assume that overall things are generally going well, and people are generally happy with the standard of living we have in Squamish. Can we afford what we have in Squamish? I think that’s an important context for some of the information in the report.
People complain about the taxation in Squamish, but since everyone everywhere complains about taxes I’m not sure that means a lot. The Annual Report lists current financial information but it doesn’t contain an analysis of how our taxation is changing.
During a budget meeting a couple of months ago, one of our Councilors suggested average annual tax increases in Squamish were about 5.5%. Our GST is 5% so on the surface a 5.5% tax increase doesn’t seem like the end of the world. Unfortunately tax increases are compounded every year, just like mortgages and credit card interest. An average 5.5% annual tax increase equates to a 71% increase over 10 years, and a 281% increase over 25 years. That’s a big increase! And that increase is despite a growing tax base.
If our incomes could keep pace with property tax growth, things might not be so bad. But the average inflation rate over the last 25 years in Canada was 2% annually. Like property tax, inflation is compounded annually. If we assume the same inflation rate (and pretend we all get raises at least as high as inflation) that works out to 28% over 10 years, and 64% over 25 years. In other words, our property taxes are rising at a much faster rate than our incomes. To put that even more bluntly, we seem to have a great standard of living in Squamish, but it may not be affordable.
A commonly accepted piece of wisdom is that a return of industry would solve our tax problem. Unfortunately this isn’t likely the case, as I discovered from a presentation to Council by the BC Assessment office. There may be other reasons to consider industrial growth – it’s just that it won’t solve our taxation dilemma. The short explanation is that industrial parcels tend to grow at a very slow rate in value (or often times even depreciate in value). Residential parcels tend to increase in value much more quickly.
Municipalities have already taxed industry to a point where it’s challenging for them to increase industrial taxes further. Although a new industrial payer will add to tax revenues, its ongoing tax contributions are more likely to shrink than grow. And as long as our taxation demands keep growing, we’ll still be in a situation where small business and residents see exponentially increasing taxation. Even if we hadn’t lost the saw mills and pulp mills, our ongoing tax increase levels mean we’d be in the exact same situation.
Where does that leave us? Basically we need to tighten our belts, but how?
We like to blame poor Council decisions for the growth in our taxes, and admittedly it is our Council that approves our budget. But, it is you and I that have demanded that Council provide us with a new turf field for soccer, new slab for hockey, new skills park for mountain bikers, new lights for the ball diamonds, funding and grants for programs and festivals, and so on. These are often big ticket luxury items (even if you factor in grants and volunteer efforts) and they often come with ongoing (and increasing) costs. Arguably it is these new investments that have resulted in such a glowing Annual Report, but having sat through a number of budget meetings, I also think they are a big factor in our unsustainable tax increases. Despite what I’ve written, I believe Squamish needs to continue to invest in its future. But, maybe we’re at a point where our quality of life is good enough that municipal financial return on investment needs to be a much bigger factor in decisions?
Overall, I’d probably give Squamish a B+ or A-, because we still have some work to do, and I don’t want us to get complacent. Squamish really is an incredible place to be living for most of us. Most of the challenges I identified relate to affordability; they’ll be improved by greater affordability, or fixing them will result in more affordability. So let’s get to work on getting that A!
