Vancouver mayor warns of cuts to core services due to COVID-19 crisis
VANCOUVER -- Vancouver Mayor Kennedy Stewart is painting a bleak financial picture for the city in light of the COVID-19 crisis that could include sweeping cuts, and the city selling off assets to pay its bills.
The dire warning comes after the mayor’s office released results of a poll done by Research Co. that gave a clearer picture of the devastating financial and economic impact the crisis is having on the city’s residents, with 46 per cent of those polled saying they have either lost their jobs or experienced a reduction in hours.
The survey also indicates 25 per cent of homeowners will pay less than half of their current 2020 property tax bills, with six per cent planning not to pay at all — a number that’s extremely worrying for the city, which relies heavily on those funds.
“The fire department is funded basically through property taxes. If we are finding massive losses in property taxes then we would have to address our budget. Same with police,” Mayor Kennedy Stewart said during an interview on CTV Morning Live.
The mayor says if 25 per cent of homeowners defaulted on their property taxes, the city could lose an additional $325 million in revenue, for a total 2020 loss of around half of a billion dollars. A loss like that could force further staffing cuts and potentially force the city to sell off assets, the mayor said.
“We could sell property, for example, and instead of building that park we could sell it off to private market and use that revenue to pay our bills, ” Stewart said.
“That means if we have to lay off police and firefighters response times go down. Garbage collection would be less often. Libraries may be shuttered. Even organizations like the Vancouver Art Gallery and Vancouver Symphony Orchestra that rely on the city for large operating grants may be in trouble as well.
"This isn’t a trim the fat kind of exercise, you can always find some savings. We’d be dipping into core services.”
Property taxes are due this July. City council will meet Tuesday to discuss the potential of extending the deadline, or adding a grace period for homeowners, possibly until September.
The city has already laid off about 1,500 staff.
As for the difficult situation being faced by Vancouver residents individually, the survey also suggested 68 per cent of homeowners were able to pay their full mortgage last month, and 55 per cent say they will be able to make a full payment in May.
When it comes to renters, 70 per cent said they could make a full rent payment in April, and 63 per cent said they would be able to pay their full rent amount in May.
Stewart believes if funding doesn’t come through from the provincial or federal governments, the city may end up in insolvency, unable to pay its bills. He believes many other cities across the country are in the same position.
“We need some answers. We need some suggestions and options from senior levels of government, while we as council wrestle with this in our own chambers,” Stewart said.
In an emailed statement, Municipal Affairs Minister Selina Robinson said Monday that her office is in touch daily with city officials from across the province, including those from Vancouver.
“As we move forward, we will continue to listen to them, get their input on the current situation and look at how we can deploy provincial tools to help communities during the pandemic,” Robinson said.
She said her office is in touch with several other agencies, including the Municipal Finance Authority and Union of BC Municipalities about the issues facing cities and that more information would be shared in the coming weeks.
Stewart says he has a call with Robinson later this week.
With files from CTV News Vancouver's Jen St. Denis