Managing Risk — My Overview of Local and Regional Government to 2018

As new and returning Mayors, Councillors and Regional Directors across the Capital Regional District (CRD) sign on to a four-year term, many will be welcoming opportunities for positive change, new ideas and improvements that make a difference to their communities. 

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After all, local government is about what’s possible, what’s new and what initiatives and projects will matter most to local residents.  However, just over three weeks into the new term, I sense the wider landscape is beginning to change, indicating to me a need to proceed with caution when it comes to setting strategic priorities, business planning and budget management and expenditures.  We are all vulnerable to world events and the quote, “Act locally but think globally” couldn’t be more true than it is now.

Here are some of the issues and questions at the top of my mind as I look to the future of local and regional government in the Capital Regional District:

  • Regional Sewage Treatment

A big issue with big dollars attached for taxpayers, finding new solutions in time to meet senior government grant-funding deadlines is pressing.  New Mayors in Victoria and Saanich bring new ideas to the sewage treatment debate, as does the veteran Mayor of Esquimalt.  Unfortunately for the region, the CRD was unable to move the sewage treatment agenda forward to a successful conclusion in the last term and now, the Western communities are working together on other options and have already developed a website for sharing information with the public.  When will Victoria, Saanich and Oak Bay articulate a work plan for how they will cooperate on sewage options, and how will Westside and Eastside communities work together, share information and analyze and manage issues that will impact costs for taxpayers, waste-to-energy technologies, secondary or tertiary treatment questions and capital expenditures to build one or more regional treatment plants?

  • Climate Change

While there continues to be some debate about whether or not climate change is real, we cannot deny that weather patterns have changed.  Recent extreme weather events that cause flooding and other damage, especially for coastal communities, are becoming more frequent.  In the last week alone, Courtenay and Port Alberni have suffered major flooding, necessitating a state of emergency in one community and evacuations in another.  A new map produced by the CRD and released publicly in the past two weeks shows where the most vulnerable areas are to a rise in sea levels, projected to be significant over the next six decades.  How are communities going to plan for this probability, and what are the implications for land use, emergency/disaster planning and how much will such contingencies cost taxpayers?

  • Global Oil Markets and Economies

Oil prices are plummeting and global economies are worried and watching.  Economic pundits are telling us that the price of oil has not yet bottomed out.  We now see losses on major stock exchanges in Canada and around the world and our own Federal Government is re-assessing interest rate policy, while keeping an eye on oil prices.  Alberta is witnessing a slow down in the oil patch with lay-offs and belt-tightening ahead.  Locally, these global forces will have an impact on revenues and expenditures for provincial and local governments, especially related to federal funding and grants.  How are local communities and the CRD preparing for subsequent budget impacts, especially for major infrastructure projects, given this climate of uncertainty in global markets?

  • Amalgamation — Yes, No or Maybe So

Just over half of the region’s thirteen municipalities put a question about amalgamation on their ballot in the recent municipal election.  Despite the public having little or no information on the subject, it was reported that 89% of voters  seemed to support the notion of amalgamation.  While the provincial government contemplates a study of the issue, debate continues on what the recent results mean for the region.

Ideally, all thirteen municipalities should have been asked the same question, one framed like this:  “Do you support a study on amalgamation conducted and funded by the Provincial Government?”  The same question asked of all voters in the region would have produced more reliable data and a clear indication about next steps.  Given that local governments are creatures of the Province, it’s clear to me that the Province is indeed responsible to further examine the amalgamation issue, one that is contentious for both local and provincial governments.  At the very least, what may or may not happen next promises to be interesting.

Finally, will resolving the sewage issue at the CRD be a deciding factor as to whether or not the amalgamation “Yes” movement gains further momentum?

Meanwhile, in Oak Bay…

A number of issues facing our community are all related in some way I believe, to the points I made earlier in this article.

For instance, the Globe and Mail reported this week that housing prices in Canada could be inflated by as much as 30% and that we should expect a correction in the future.  Given that Oak Bay relies on property taxes for over 95% of its revenue, a decrease in property values and property assessments, by 30%, could trigger an increase in the mill rate to compensate for decreased assessments.  There is already a hint of a tax increase coming in Oak Bay but could a major drop in housing values create a distinct financial disadvantage for Oak Bay taxpayers and affect other major community projects such as Uplands sewer separation; infrastructure replacement in other areas of the municipality; major improvements to paving and re-surfacing roads and sidewalks; and, expenditures for capital improvements to recreation, parks, the municipal hall and other municipally-owned buildings and properties, to name just a few?

The Oak Bay Beach Hotel’s recent receivership status is also a blow to Oak Bay.  Nearly $800,000 in tax arrears and tens of thousands of dollars in unpaid utilities this year are serious shortfalls that will significantly impact the municipality’s budget.  What’s more, if the receiver cannot maintain the hotel’s operation and/or if the hotel cannot be sold, compromised revenue from hotel room taxes will directly affect Oak Bay.  Does the uncertain future of the Oak Bay Beach Hotel represent a major issue when planning and forecasting future municipal budgets for Oak Bay?

Earlier this fall, heavy rain caused an overflow at a major CRD pump station, resulting in escaped sewage into Cadboro Bay and forced closure of the beach.  This happened twice in roughly six weeks and while it’s difficult to pinpoint the problem, the single pipe that carries sewage and storm water in the Uplands, may be the prime suspect.  Oak Bay was mandated by the province to separate this system but to date, the project has not moved beyond a 2014 survey of the Uplands’ area.  I understand that the province has also agreed to extend the deadline for Uplands sewer separation from 2015 to approximately 2030, despite the fact that this remains for many an urgent environmental and public health risk, particularly as climate change progresses.  Costs to rectify the problem also continue to climb.

The question is, will it be funded by a “user pay” approach (funded by Uplands’ homeowners alone) or will all Oak Bay taxpayers be required to pay for Uplands sewer separation?

  • SWOTPlanning Beyond the Next Election Cycle

Many of you may be familiar with SWOT, an effective planning tool for organizations of all kinds and sizes.  SWOT is the acronym for Strengths, Weaknesses, Opportunities and Threats.  During my public service career in policy and planning, SWOT was commonly used to identify how best to plan for and implement major projects, programs and policy initiatives, particularly during a time of change and uncertainty.

Since local governments are not only decision-makers but also policy makers, I believe that SWOT should be a key planning tool found in the toolkit of every local Chief Administrative Officer and politician.  The exercise using SWOT is not complicated and can be easily adapted to a variety of planning situations and environments.  Given my view of the current and future “changing landscape” across the region, province and country, SWOT could be especially effective when used to help guide existing regional and local government planning, which often includes developing a work plan of multi-year strategic priorities.

No community is immune to global forces that drive local, provincial and national economies and have a major influence on how we grow and develop over the next four years and beyond.  Governments are interdependent so in the current environment, it will be even more important to put our best heads together, practice due diligence and coordinate planning, a process that looks to the long term and not just to the next election.  The aspirational goals of community resilience and sustainability are significant benchmarks for local governments and will have even greater meaning to the future of our region.