The Ville de Montréal budget: an opportunity to blaze a new trail

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Added on 30 November 2010 in Viewpoints

Text signed by Michel Leblanc, President and CEO of the Board of Trade of Metropolitan Montreal, and published in Le Devoir and Cyberpresse.ca

November 30, 2010

The Ville de Montréal budget: an opportunity to blaze a new trail

With its upcoming budget, the Ville de Montréal must try to generate savings from its operating structures.

In a few days, the Mayor of Montréal will table his 2011 budget, a perilous exercise when the temptation to raise taxes and other sources of funding seems irresistible. However, before adopting a wholesale increase in taxes, Montréal needs to be disciplined and determined about cutting expenses. It must be better organized, streamline its processes and structures and, above all, be much more efficient.

This is not just a question of respect for Montrealers, but also an absolute necessity to make the city reasonably competitive on a North American scale.

We have asked that the Mayor pay particular attention to seven specific initiatives that could lend energy to the governance of the city and help clean up the city’s finances:

  1. The Ville de Montréal must have a central function for independently analyzing the value of and options for any matter with major financial consequences before it goes before political authorities for approval.
  2. The Ville de Montréal must strengthen its central departments so that they can adequately fulfil their functions.
  3. The city council must review the makeup of the audit committee to ensure majority representation by independent members, with no members from the executive committee.
  4. The Ville de Montréal must be the sole body responsible for public consultation processes for approving major projects. It must simplify the approval mechanisms and develop user-friendly measures to support and supervise developers to facilitate the completion of these projects.
  5. Working with the boroughs, the Ville de Montréal needs to identify neighbourhood services delivered by the boroughs that require standards of service.
  6. The Ville de Montréal must undertake a systematic study of administrative and technical support services currently handled by the boroughs and identify the right conditions for grouping them into shared service units.
  7. The Ville de Montréal must conduct comparative studies of its municipal services to rate their efficiency compared with major North American cities facing similar circumstances.

 

These initiatives are drawn directly from a report published by the Board of Trade of Metropolitan Montreal in March, entitled A City that Lives Up to Our Aspirations and produced by a group of independent experts chaired by Marcel Côté and Claude Séguin.

Streamline and strengthen the city administration

Will the city administration finally take the bold step of truly reorganizing its governance and optimizing service delivery? There are too many elected officials, too many splintered decision-making centres and too many demotivated employees.

The central city must repatriate and consolidate a number of activities unrelated to local services to citizens, such as IT management, building management and legal services. Any large enterprise knows that such services can be managed more cost effectively when they are better integrated.

The Ville de Montréal has made some effort at reducing expenses by asking the boroughs to find $50 million in their budgets. While this is a start, it is clearly insufficient. The Ville de Montréal has also required that all city departments submit plans for cutbacks. But this effort does not get at the heart of the problem: the multiplicity of structures and the absence of clear accountability.

Beyond centralization, the boroughs have to share equally in the solution by consolidating services. The boroughs should work together for snow clearing, garbage collection and recreational services to improve the coordination of work and reduce the cost of delivery. The keyword is efficiency.

Ultimately, city officials must consider an option that has been taboo until now: exploring savings that can be achieved through borough mergers. A number of neighbouring boroughs share historical, demographical and other realities that would make a merger smoother. Reducing the number of elected officials and related administrative support and political personnel would also send a strong message that would increase the administration’s credibility when it asks others to make sacrifices.

Revenues to increase Montréal’s competitiveness

The Mayor recently announced his intention to raise property taxes by 2.5% based on the recent increase in the assessment roll. We see this moderate increase as good news because, on the one hand, increased property assessments are testimony to the overall growing wealth of Montréal owners and, on the other hand, the Côté-Séguin report identified a property tax freeze as one of the sources of the recurrent budget crises of recent years.

However, the Board of Trade reiterates its opposition to the decision to impose a tax on downtown parking, because we believe that we have to count on the commercial attractiveness and vitality of downtown rather than help isolate it. In the same spirit, any tax targeting vehicle registration or gas consumption must be metropolitan in scope and finance transportation projects, such as the renewal of metro cars, which will increase the productivity of the entire region.

Invest in major growth-generating projects

Finally, if the Ville de Montréal’s economic development strategy is based largely on supporting a few major base-building projects, the Board of Trade wants to see specific financial commitments to some of these projects in the next budget. Among other things, the Ville de Montréal should indicate what it intends to do with the new money the Government of Quebec awarded it last spring.

The discipline of imposing control mechanisms

In closing, a number of the recommendations in the report are possible solutions to the budget difficulties that the Ville de Montréal has been facing for the past few years, and we will watch the next budget with particular interest to see whether the administration has seized this opportunity to take concrete action that will make a real difference to stimulating Montréal for years to come.