By Alex McCuaig

Two rec centres, one pool to stay closed in 2021

City slashes nearly $15 million from budget in biggest ever spending cut

Dec 8, 2020 | 12:06 AM

MEDICINE HAT, AB – Medicine Hat will be cutting staff, closing facilities and reducing funding to services that will slash overall spending by double digits as it tries to plug a revenue shortfall punched into it by plummeting commodity prices and a global pandemic as council voted Monday night to revise its 2021 budget.

The budget amendment will see spending reduced by 11 per cent resulting in nearly $15 million in savings while cutting next year’s planned four per cent property tax increase to zero.

But the moves will come at a cost.

The Moose and Crestwood recreation centres along with the Heights Pool will be closed in 2021 with no definitive plans of reopening the facilities. It will also result in at least 70 less people working for the city and possibly more. Services like the Public Library will see a reduction of more than $125,000 in funding while police and fire could see less tax dollars for their budgets.

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“We’re going to have less people working for the City of Medicine Hat going forward,” said Coun. Darren Hirsch who, like nearly every other councillor, had high praise for revised budget which passed unanimously. “$14.8 million is not a small feat. That is a significant amount of savings.”

But despite the moves which will result in one of the largest – if not the largest – cut ever in municipal spending, the city will still need to reach into its reserves to make up for an $8 million shortfall.

Coun. Julie Friesen said the city had no choice but to get its financial house in order so as not to drain those reserves entirely.

“At our current rate of spending, coupled with declining revenues and grant sources, if we keep this up we’ll be in serious trouble,” said Friesen. “If we continued to supplementing the tax-supported budget at our current rate which is the status quo, we would have no reserves, no savings left.”

There were some bright spots in the amended budget.

The city’s investment portfolio gained $59 million more than anticipated and produced a better than expected 2.5 per cent return on investment.

However, the city’s debt to revenue rate now is starting to bump up against its self-imposed 70 per cent cap ceiling, sitting at 68 per cent.