Saskatoon facing 2022 deficit of nearly $11 million

The City of Saskatoon is facing a $10.99-million deficit for 2022, including $1.97 million related to the major snowfalls that occurred just before and after Christmas.

According to Kari Smith, the city’s finance director, the rest of the shortfall came from higher-than-anticipated fuel prices, and what she called “inflationary increases.”

Under provincial law, cities, like school divisions, can’t operate with deficits.

“Some revenues we’re not recovering quite as fast as we had expected … such as in our leisure centres and our parking revenue and parking ticket services,” Smith added.

At the next Finance Committee meeting on Wednesday, administration will recommend that $9.02 million come from city reserves, including the Animal Service Reserve, Audit Program Reserve, leftover Youth Sports Subsidy funds, Special Events Reserves, and the Fiscal Stabilization Reserve.

The remaining $1.97 million could be covered as part of a plan to potentially borrow $20 million to pay for cleanup and snow removal after the city enacted its the Roadways Emergency Response Plan. Whether that money is borrowed from external sources or comes from another city reserve, council has yet to determine.

“That decision hasn’t been made yet,” said Smith.

“We’re waiting for the final costs of all of the snow events. We still have costs that were incurred in the beginning of ‘23 for that snow event.”

Smith said the city is also putting spending restrictions in place to try and keep costs down.

“This is reducing travel, reducing training, office supplies material (and) also deferring hiring where it makes sense,” she added.

As for the reserves, where the lion’s share of the money to cover the deficit will likely come from, Smith said they chose reserves they could dip into without affecting services.

“All of those reserves, we felt, had the funding necessary in which to do that,” she added.

The 2022 budget deficit payment plan still has to be approved by Saskatoon’s city council.

Smith noted the plan does not affect this year’s property taxes, which were approved late last year at an increase of 3.93 per cent.