VANCOUVER -- The City of New Westminster is losing about $1 million dollars a month, while Port Coquitlam is moving to do millions in short-term borrowing, as more cities are showing financial strain from the COVID-19 pandemic.
New Westminster has seen parks and recreation fees and casino revenues drop, said Mayor Jonathan Cote.
"These funding sources are drying up. We are doing our best to reduce our costs," he said. "Our big ask (of the provincial government) is to help all of the cities implement tax deferral programs to allow us to let our citizens have a bit more time to be able to pay our property taxes."
In Port Coquitlam, Mayor Brad West said his city is prepared to weather the COVID-19 storm, saying he had cancelled a property tax increase and had delayed property tax collection until September 2.
"We’ve been focused on delivering our core municipal services," he said. "We have our obligations and we’re confident that we have the ability to do that."
Port Coquitlam’s council will consider a bylaw to allow it to borrow $30 million temporarily to make it to September.
B.C.’s Community Charter allows municipalities to borrow money to meet lawful expenditures — as long as the amount doesn’t exceed taxes and payments from other levels of government that have yet to be collected.
Under that rule, Port Coquitlam’s maximum borrowing would be about $83 million, according to its motion.
But Vancouver would not be able to use a similar mechanism, said Mayor Kennedy Stewart. He's worried that Vancouver could be facing half a billion dollars in shortfalls.
"This is a huge hit. When our operating budget is $1.6 billion you can imagine that if a quarter of your operating budget just evaporated. This is very serious,” he told CTV News.
The mayor has arrived at that figure by considering the worst cases of two different projections.
In the first, city staff projected losses based on estimating when public health orders would end. If the restrictions ended in May, the city would face $61 million in lost revenue from parking, parks and casino revenue.
If the orders are lifted by August, the city would face $111 million in losses; by December, $189 million.
And Stewart pointed to a Research Co. survey that suggested as many as 25 per cent of Vancouverites will pay less than half of their property taxes bills. Only six per cent said they would pay nothing.
Stewart’s figure there is a loss of $325 million, based on all of those 25 per cent paying nothing.
The City of Surrey has not yet made any projections known publicly.
The question is not whether the city will receive these revenues. If someone doesn’t pay their property tax in B.C., the city has the right to seize their property, sell it, and use that revenue to pay the difference.
The question is whether the cities will receive those revenues in a timely way so they avoid ceilings on borrowing imposed by provincial laws. Cities have been asking for the province to remove those restrictions to allow them to meet financial obligations while giving some deadline relief to their citizens.
The provincial government has not yet confirmed any changes will be made, though Premier John Horgan last week said he is working with cities on the problem.
