The Party at City Hall is Over

 

                                  What a Party It Has Been!

Anyone running in the Ottawa municipal election this fall should be aware of the preliminary financial results for 2009 and the comparative financial figures from the year of amalgamation. If elected, you will be a “Steward” of the taxpayer’s money. You will have a major job to perform in cleaning up the financial mess created by those councillors that have more than 8 years on council. Every one of them is to blame because they have not spoken out on the subject.

Also to Blame:

-Not the current Mayor. He spoke out about union wages and benefits and paid the price.

-Senior Management for incompetence and inefficiency

-Greedy Greedy Public Sector Unions

-And, the McGuinty government for allowing outrageous wage and benefit settlements in the Ontario public sector that filtered down to Ontario municipalities by unelected and irresponsible, so called, arbitrators.

Ottawa is the worst performing municipality in Ontario considering financial results in two categories of expenses: (1) Salary, wages and employee benefits and (2) Contracted Services. This takes into consideration the official growth in population in the City of Ottawa between 2001 and 2006 by Stats Canada of 4% and estimated (liberally) at 4% since the census to the end of 2009. The population growth of 8% during the 2000-2009 period is miniscule compared to the growth in city revenue and expenses.

The following financial figures do not include the extremely generous “unfunded future employee benefits” which will keep the taxpayers in the poor house for years to come.

The financial figures represent a summary of the position of the City of Ottawa. The “drilled down” numbers for the comparative period will be available for resident taxpayers and individuals running for council, no matter what your political thinking may be, in the very near future.  Simply put, Ottawa cannot continue to increase taxes and user fees and hand over this money to employees and consultants and contractors.

Take a hard look at the numbers and ask yourself the questions: Think about low interest rates, low inflation and the efficiencies that were promised by Bob Chiarelli.

The Highlights:

Annual Revenue in 2009 is $953 million higher that in the year 2000

The Category: Salary, wages and benefits is $593 million higher than in the year 2000

The Category: Contracted Services is $116 million higher than in the year 2000 (2000 is estimated at $60 million)

These two expense categories accounted for 75% of the expenditure of the additional revenue generated.

Please note:

Financial figures are compared from the day of Amalgamation (Dec 31 2000) to December 31 2009 unless otherwise indicated by *.  Some classes of revenue and expenses have been reclassified as demanded by the Province of Ontario. See Note 18 in the 2009 audited financial statements.

Comments to wmomalley@gmail.com

Municipalities Out Of Control

Source: Audited Financial Statements
City of Ottawa
As at Dec 31st							%
000’S	Amalgamation						Increase
	Date
Revenues	2000		2004		2009
Net taxes available for municipal purposes	$934,243		$1,059,355		$1,286,044		37.66
Fees and User Charges	$375,232		$467,690		$623,350		66.12
Government Grants	$276,127		$363,975		$471,419		70.73
Investment Income	$45,158		$40,448		$26,071		-42.27
Contributed Tangible Capital Assets	N/A		N/A		$145,296		N/A
Interest from Ottawa Holding Inc.	N/A		$16,455		N/A		N/A
Equity in earnings of government  business enterprises	N/A		$19,659		$29,414 *		49.62
Fines and Penalties	N/A		$18,767		$23,567 *		25.58
Development Charges	$11,144		$47,052		$81,392		630.37
Other Revenue	$101,365		$30,321		$10,369		-89.77
Total Operating Revenue	$1,743,269		$2,044,063		$2,696,922		54.70
Operating expenditures by object							%
	2000		2004		2009		Increase
Salaries, wages and employee benefits	$665,004		$922,292		$1,258,156		89.20
Contracted and general services	$0		$86,219		$176,315 *		104.50
Materials, equipment and supplies	$329,343		$296,878		$500,698		52.03
Interest charges	$55,164		$61,462		$64,594		17.09
Rents and financial expenses	N/A		$35,537		$51,634 *		45.30
Third-party social, cultural and recreation programs	N/A		$313,153		N/A		N/A
Capital Expenditures	$311,963		N/A		N/A		N/A
Other	$356,047		N/A		N/A		N/A
External Transfers	N/A		N/A		$335,185 *		N/A
Amortization	N/A		N/A		$208,205 *		N/A
Expenditures recovered from capital	N/A		-$28,855		N/A		N/A
Total Operating Expenses	$1,717,521		$1,686,686		$2,594,787		51.08

The Great Canadian Census Debate

Canadian Census Blog

Munir Sheikh, the chief statistician of Statistics Canada abruptly quit, resigned, retired or was fired from his government job this past week. It appears that he actually quit in protest to the government’s position in abolishing the mandatory long-form census questionnaire. Sheikh issued a statement on leaving his position indicating that a mandatory long form census questionnaire was necessary to obtain accurate census data.

Number one is that Mr. Sheikh politicized his government job by issuing that statement. Government employees cannot play partisan politics with their government position. They must follow the wishes of the government of the day or pay the penalty. Mr. Sheikh deserves to be penalized for his very public opposition to the change in government policy over the long-form census questionnaire.

Number two is that Mr. Sheikh played willfully into the hands of the partisan media like the Globe and Mail, CBC and other elitist groups in Canada that consider themselves Royalty. Dam the people.

While other countries are moving to abolish any kind of a census, the media and elitist groups, unrepresentative of the people of Canada, are bulldozing their way to manipulating census opinion by half truths and outright lies.

All of the citizens of Canada should be educated as to the questions asked in the long-form census questionnaire. A good start for the media is to publish the questions asked in the last long-form census and then let the people decide if the questions deserved to be answered.

The last long-form basically asks you to reveal every financial detail about your household and your employment history and even goes further by asking your permission to access your income tax return. The media is purposely leaving this aspect of the long-form from their discussion of the pros and cons of the value of the information.

Rather, the media is misleading the public by referring to unimportant questions on the long-form that ask for information about how many rooms you have in your house and what time do you leave for work in the morning.

The elitist groups in Canada and the media have to level with the public. The provincial and municipal governments already have more than sufficient information in their hands to make informed and enlightened decisions on various aspects of local development without financial information from the long-form census.

Further, we are equal under the laws of this country and if 20 % of the population was required to answer questions in the previous long-form census, than in the up and coming census, 100% of the population must answer the long-form. Otherwise, this becomes a Charter Issue.

And Statistics Canada have stated that your in-depth revelation of financial data is secure in the hands of 6000 Stats Can Employees and to the elitists that buy the information from Stats Can.

Bull:


Bill O’Malley

Ottawa Annual Budget Contents

 

Declaration of annual budget content is necessary!

City of Ottawa

April 16^th, 2010

The controversy over the recently adopted City of Ottawa 2010 Budget (Jan 2010) is still unresolved.

The “partial” budget increased property taxes by 3.9 percent.

A few days ago (April 2010) Council adopted the 2010 Water and Wastewater Budget with a rate increase of 9 percent.

Have you had a chance to comment on the Water Budget before it was adopted? Where are the detailed comparative annual numbers for the Water Budget? I haven't seen a production of the information yet. The 9 percent increase is despite the fact that water consumption has decreased due to family taxpayer's great conservation attitude. The result for you. You conserved too much water so the city is going to go for a minimum charge and then soak you for anything above that. You pay more because you used less water.

The combined Property and Water TAX increase is somewhere around 6%, and totally ridiculous. Councillors just didn't want you to know the real percentage increase in taxes that you were facing.

Now, I don't know about you, but if you are preparing a budget all relevant categories must be addressed in that budget. A budget is not a budget if the budget is only part of a budget.

Councillor Peter Hume seems to think that having one budget, but really having two budgets, without informing the taxpayer, is just fine. Too bad he will not be running for Mayor in the upcoming 2010 municipal election. If he did, he would finally have to look for a real job.

Without notifying the resident taxpayers, Council and Senior City Staff separated the budgets into what is called (1) a “Taxpayer Support” Budget and (2) a “Rate Supported” Budget. Isn't a taxpayer and a ratepayer in the City of Ottawa the same person? The cost of city operations come from the same pocket. Your pocket!

If you are a resident taxpayer, renting rather than owning your property, you pay 1.7 times the tax rate of property owners. And you don't think you have a voice! You use less space, use fewer costly city services and you are privileged to pay a premium for your conservation. This is becoming a trend. You can add water and electricity to this trend. Then you can add property taxes. The more you conserve, the more you pay.

Two or even three separate budgets would be appropriate only if all of the separate budgets are consolidated into ONE OVERALL BUDGET, to be voted on at the same council meeting once each year. This would reflect some respect for the taxpayer.

The budget questions arose in Jan 2010 when I indicated in my Blog that the 2010 Budget for salaries, wages and benefits (employee expense) was reflected at $1,221,997,000 while the 2008 audited financial statements stated employee expense at $1,176,349,000 in that year. As employee expense is rising at approximately $60 TO $70 million a year (can you imagine) at the City of Ottawa, the 2010 budget figure did not make any sense. Do the math. The 2010 Budget should have reflected total employee expense at approximately $1.3 Billion dollars or approximately $78 million dollars higher than budgeted. That's a lot of money!

During the controversy, OTAG (Ottawa Taxpayer Advocacy Group) and our local CFRA radio asked city staff and/or councillors to clarify the matter and this is what was offered. Again, it was Councillor Wilkinson that took the “bull” by the horns and dragged the answer from City Staff. She has the right attitude which is important, but I am continually surprised by what City Councillors do not know. She has my vote.

City Staff responded as follows to the difference in numbers between the audited financial statements and the annual Budget:

1.      The Tax Supported Budget does not include the employee expenses associated with the Rate Supportedwater and sewer Budget which are  included in the financial statement number
2.      The audited financial statements include the expenses of our local boards and agencies, such as Ottawa Community Housing Corporation
3.      The audited financial statements include numerous accounting adjustments for post retirement and post employment expenses which are required under the Public Sector Accounting Board reporting requirements.

It is unfortunate that Council did not inform the taxpayers of Ottawa of these facts prior to discussions of the 2010 Budget.

Therefore, be it resolved that, the 2011 Budget must include the following and be so declared by Council prior to 2011 Budget discussions:

Tax Supported Budget projections

Rate Supported Budget Projections

All Local Boards and Agencies budget projections

Projections for retirement and post employee expenses.

This means that all departments, agencies, boards and rate supported programs submit and incorporate their individual budget projections in the annual BUDGET DISCUSSIONS. Further, that requires a directive to these groups by Council. As a result, the information will be there for all to see, question, agree with or dispute. This is democracy.

Council must also require all other organizations, held by investment or otherwise that changes in fiscal year ending and Budget submission dates must compliment that of the City of Ottawa. Those Organizations or Investments must also make their financial data available to the taxpayer.

Bill O'Malley

City of Ottawa 2010 Budget

January 21, 2010

City of Ottawa 2010 Draft Budget

“in a Nutshell”

City Council will be meeting next week (Jan 26th,2010) to discuss the 2010 Budget.

The following information will provide the resident taxpayers of Ottawa with "all they need to know" about the 2010 draft budget.

Revenue from all sources, including property taxes, is expected to increase by $96 million dollars for the 2009/2010 period. $64 million of that new revenue will be used for additional employee expense. Almost all of the remaining new revenue ($32 million) will only cover inflationary costs for the balance of “other City budget expenses”.

Nothing has changed at city hall over the years other than employee and inflationary costs. Councillors can easily adopt the budget next week in one day as they did last year.

The resident taxpayer will pay an additional 3.9 percent more property tax than last year ( not including the increase in your property value) while commercial/industrial and “in lieu of “ taxes remain flat. The weight of the tax increase is on your shoulders only.
_______________________________________________

Senior City staff presented the 2010 Operating and Capital Budget dated December 9th, 2009.

 

The detailed draft operating budget reflects 2010 projected revenue of $2,318,746,000 ($2 billion $318 million $745 thousand dollars) and total expenses of $2,318,745,000 ($2 billion $318 million $745 thousand dollars). 

Of the total 2010 projected operating revenue, employee expense is $1,221,997,000 ($1 billion $221 million $997 thousand dollars)

Now, the 2010 budget is projecting $93 million dollars in new revenue over 2009 from all sources including grants etc.


Of the total 2010 projected new revenue of $93 million, $64 million will be utilized for employee salary, wages and benefits.


Employee Expense is devouring 69 percent of the new projected revenue.


The majority of the balance of new revenue ($29 million) will only cover annual inflationary expenses on the remaining city operating costs of $1,096,748,000 ($1 billion $96 million $748 thousand dollars). This is no different than prior years. The city is at an economic standstill and has been for the past decade while employees reap outrageous salaries and benefits gains and the property taxpayers are driven into the poor house because of the lack of participation in the democratic process by many resident taxpayers.


Of the projected 2010 new employee expense of $64 million, almost $23 million of that amount is designated for OC transport employee expense, or 36 percent of the total.


The last time I looked, OC transport has approximately 14 percent of total City employee FTE (full time equivalent) positions at the City.


The transport Committee should be happy with this, especially Alex Cullen. I projected last September at a city hall meeting that this would be the case in 2010. Alex Cullen was not happy with my projection. Well, now he has no choice, but to acknowledge it.


The other thing about "employee expense" that is mysterious:


In 2010, total employee costs are projected at $1,221,997,000 ($1 billion $221 million $997 thousand dollars). This represents 53 percent of the total budget. Employee expense as a percentage compared to revenue is the highest of any municipality in Ontario.


The 2008 City of Ottawa audited financial statements certify total employee expenses in that year of $1,176,349,000 ($1 billion $176 million $349 thousand).


Now, the difference between the 2010 employee expense projection and the 2008 figure is $45,997,000 ($45 million $997 thousand) for the two years.  

That is simply impossible.

2008 Audited Financial Statements: Employee Expense $1,176,349,000
2010 Draft Budget: Employee Expense $1,221,997,000
The Difference: $ 45,997,000


The increase in employee costs as per the 2010 budget between 2008 and 2009 is $65 million and the increase between 2009 and 2010 as stated above is $64 million. (rounded numbers)


The draft budget reflects the total increase in employee costs from 2008 to 2010 of $130 million.


One cannot have a difference of $45 million for employee expense between the most reliable source for financial data as the 2008 audited financial statement and the 2010 projected budget, when the 2010 budget itself totals the difference as $130 million for the same period.


Therefore my conclusion is that employee expense will be recorded in the future 2010 audited financial statements as $1,304,997,000. In other words, Senior Staff are knowingly underestimating 2010 employee expense by $83,000,000 ($83 million dollars). Can you imagine?


It is clear that something has to change at the City of Ottawa this municipal election year for the good of democracy and the pocketbooks of the taxpayer.


*This means a total change in councillors at election time


*a change in senior staff


*a reduction in employee salaries and benefits through employee layoffs


*or an employee cost freeze and/or salary and expense rollback


*and more residents of the City of Ottawa to embrace democracy by direct participation in the municipal process before it is lost for good.




Bill O'Malley


Comments are welcome at wmomalley@gmail.com

Bilingualism at Ottawa City Hall

If you aren't upset with the manner in which City Hall is controlled, then you should be upset with the following:

On September 15, 2009 the Ottawa Taxpayer Advocacy Group reserved the Champlain room at City Hall for a discussion with Councillor Marianne Wilkinson and Councillor Alex Cullen.

The public was invited.

One of invitees carried with him a sign opposing City Hall and its methods of governing, The physical sign complied with City Hall policy, except for the fact that the sign was "not bilingual", and only written in "English"..

A security guard quickly advised the guest to get rid of it or the guest would be expelled from City Hall.

There was much discussion and disbielf by those who were heard the confrontation.

Now, I don't know about you, but this is Canada. I can speak or write in any language that I want.

In this case, I do believe that Ottawa City Hall procedures have restricted the right of its citizens.

City Councillors again let the citizens down for allowing such a thing to happen.

Bill O'Malley

Ottawa City Hall Sept 15 2009

-->

Text of my 5 minute introduction speech at the meeting with

Ottawa Taxpayer Advocacy Group Chairman Ade Olumide

Discussions with Councillor Alex Cullen and Councillor Marianne Wilkinson

Ottawa City Hall

September 15,2009

Opening Statement

Bill O’Malley

Prior to my statement, I thanked Councillor Marianne Wilkinson, as she was the only Ottawa City Councillor to challenge the financial figures I presented to every City Councillor.

She and other Councillors were "shocked" with the figures I presented from my September 2008 blog.

.

She then requested the City Manager and City Treasurer to check the numbers. It took City Staff the best part of one month to do so. Marianne Wilkinson forwarded to me, in writing, confirmation from those mentioned above, that indeed my presentation was correct.

This is a 100% accurate picture of the state of Ottawa financial results for the period 2000-2008

Now the following is my statement in front of Councillors, 60 or so concerned residents, CTV, the Ottawa Citizen, and CFRA.

This is my statement

Ottawa is a good city and the residents are great, but as more and more residents are realizing, this City is not living up to its potential.

Amalgamation, recommended by a previous City administration, was to make the City more efficient in its operation and save the resident taxpayer money.

As you know, that didn’t happen.

The taxpayer has and is being taken for granted. Property taxes have increased and additional User Fees have added a heavy burden to many resident families.

In order to appease the taxpayer, glowing reports have been produced by City Hall describing the progress in the City. The reports didn’t reflect the true picture.

The intrusion of City Hall into areas that are not in the sphere of basic city services is rampant.

And over time, since Amalgamation, the taxpayer is catching onto the methodology of Councillors and Senior Management. The average taxpayer wants more of a say in the way their money is spent.

As a result, you now have the formation of the Ottawa Taxpayer Advocacy Group.

The Party is over at City Hall.

There are many areas of City operations that can be improved on, but for this session, we will focus mainly on the largest expense of the City of Ottawa and that is the compensation level of its workers.

Perhaps, it is better stated as the number of employees deemed necessary to run this City, receiving a level of compensation that far exceeds the private sector. (about 40% more)

The combination of the number of employees and the compensation level is a formula for disaster to the financial soundness of the City.

The taxpayer has heard too often that compensation is comparable to other cities, the Unknown ARBITRATORS were responsible, there may be a strike if union demands are not met, the Ontario Government forced a level of service in certain city services that required more staff etc.

Well, we are not Toronto, Vancouver or Hamilton, or Windsor or Thunder Bay. Each city has its own economy and in Ottawa we have to operate this City within the confines of that which the taxpayer can afford.

This City and individual departments within it, frequently compare themselves to other Canadian cities when the end result suits there cause.

However, the “buck” stops at the Ottawa City Councillors. You authorized the wage levels and you authorized the hiring of employees.

On Amalgamation day, the city of Ottawa expensed 38.1 percent of its total revenue on employee salary, wages and benefits.

As of December 31, 2008, the level of compensation had increased to 52 percent of total revenue or $1.2 billion dollars or so.

How and why this was allowed is beyond the comprehension of the majority of taxpayers. Many responsible citizens have warned Council that they were going down a path to financial disaster.

The Ontario Municipal Act bestows the power of ruling individual municipalities to the elected Councillors. It also provides an obligation and duty on the Councillors to utilize the resident taxpayer’s money in a manner the benefits the taxpayer. This is not happening.

The Municipal Act also dictates responsibility and duties on City Council. The elected Mayor and Council have, as a body, the duty to exercise all the powers of the municipality provided to it under The Act.

And it is all about “money”.

In this regard, I want to talk about “New Revenue”. Revenue is money received by the City from property taxes, government grants, user fees and any and all other sources of revenue. The “New” refers to money received over and above revenue generated for the year 2000.

The same applies for the term “New Employee Expense”.

Of the eight jurisdictions in Ontario with “New Revenue” over 1 billion dollars during the period 2001-2007, the City of Ottawa had the highest usage of that New Revenue for New Employee Expense.

A whopping 72.24 percent!

This is according to the financial statements, but differs from the Financial Information Report where the New Employee Expense is a staggering 81 percent of all “New Revenue”.

That means that the City of Ottawa is basically “stuck” in the year 2000 as the remaining balance of New Revenue generated since amalgamation has, for the most part, only covered the additional inflationary cost of purchasing necessary materials used in maintaining the city infrastructure and other services.

The average usage of New Revenue for New Employee Expense for the other eight jurisdictions was 43.59 percent. Now Stop and Think About That Number.

Ottawa had 72.24 percent usage and the other Ontario jurisdictions had only 43.50 percent. Does this make any sense?

As mentioned earlier, Ottawa entered amalgamation with a percentage of 38.19 percent of Total Employee Expense to Total Revenue, .but increased to 47.10 percent in fiscal 2007. At the end of 2008, the percentage rose to 52 percent. Something has to “give”.

If Ottawa had maintained the percentage of the other larger Ontario municipalities, there would have been over $500,000,000 Million Dollars to look after our roads and sewers and beautify the city etc.

Or heavens forbid, Property Tax or User Fees could have been reduced. Instead, Council gave it to the employees. The taxpayer received nothing more than higher tax bills and higher User Fees.

Now let’s look at the number of employees employed by the City.

According to a list provided by Kent Kirkpatrick to Stittsville-Kanata West Councillor Shad Qadri in 2008, the City had 19,000 employees or “jobs” as Kirkpatrick described it.

.

The 2008 Budget, according to Qadri, authorized 12,000 full-time equivalent employees. This information was reported in the Ottawa Citizen September 17, 2008. But again, Qadri’s Full Time Equivalent number of 12,000 was not correct.

If you want the real figures, Councillors should refer to the approved Budget and the Financial Information Report. If you don’t want to do that, The Ottawa Taxpayer Advocacy Group will provide the numbers for you.

Better still, Senior Management should provide a detailed list monthly to the taxpayers. Then, no one can run and hide.

Again, Kent Kirkpatrick indicated a level of 19,000 employees in September 2008. Kent Kirkpatrick informed resident taxpayers in the 2006 Ottawa Annual Report that there were “nearly 17,000 City Staff”. 

Even the Auditor General uses this figure in 2007 reports. Does this mean that the city added 2,000 staff in the 2007/2008 period?

The taxpayers have a right to know the authorized equivalent number of employees and normally this information is provided in the annual approved budget. However, we need to know more.

We need to know the number of full-time employees. Full Time Employees are 100 percent FTE.

We need to know the number of part-time and seasonal employees, like in the number of human bodies, and this number as related to the make up of full time equivalent or FTE.

And finally, we have to know how many full-time equivalent positions are vacant. These figures should total the authorized full time equivalent as outlined in the Approved Budget.

The majority of city employees are deemed to be conscientious in performing the duties of the job, but amalgamation and the slow growth of the City population over the past eight years does not account for the current number of employees working at the City.

A real effort must be made by Council to reduce the number employees. Senior Management can no longer stack the numbers and hide the employee numbers to the taxpayer.

And Council has the opportunity tomorrow to start to show its regard for the taxpayer dollars.

There are a number of City Departments that recently announced that they may be over Budget. The Ottawa Taxpayer Advocacy Group would like Council to send a directive to these departments informing them that in the last three months of this fiscal year, each department must find a way to balance the authorized Budget through a combination of Layoffs and reduction in spending in other expense items.

This would be the first step to ending a cover-up

 

Let’s see if Council is mature enough to take the necessary action and send the signal to all departments that the Party is Over.

2010 Council Information and Classes

Ottawa Municipal Election 2010

There are 23 wards and a mayor to be elected in 2010.

Any serious candidate (only one for each ward) willing to join a slate of candidates to take back “City Hall” for the benefit of the Taxpayer, will be provided with detailed financial information as follows:
 
A Complete and detailed breakdown of the approved “Budgets” of the departmental figures for the period 2001 to 2010

A Complete and detailed spread sheet of the Audited Financial Statements from 2001 to 2008

A Complete and detailed breakdown of all of the pertinent departmental financial information as provided for in the Financial Information Report for the period 2001 to 2008.

Reports on specific departments that are underperforming

Reports on the Employee Expense which has devoured 81% of every $1 of property tax increase since 2001 and Every Other Source of Total Revenue, including Government Grants.

Council has very little control over Senior Management at the present moment. You will be provided with the information in the Act that will allow you to direct and control City Management without interferance from other levels of government.

You will receive a copy of the Municipal Act and we will review the detail in a classroom atmosphere.

I will also offer several other “classes” for new candidates to bring them up to date on the operation of Council, the Duties and Responsibilities and the inner workings of City Hall. This is crucial in order that you can take your seat at Council, be effective and rule the City for the Taxpayer.

All of this is My Contribution if you are willing to democratically enhance the operations of the City.
 

This offer will be open to Candidates that declare their intentions before December 31, 2009.

Bill O’Malley

Contact me at wmomalley@gmail.com