2020-11-04

Mayor disputes, questions province’s financial measuring tool for municipalities

by KEITH CORCORAN

The Department of Municipal Affairs (DMA) sidesteps feedback from civic government leaders and isn't working with municipalities to fix a tool the province uses to measure a municipality's financial health.

So says Bridgewater's mayor, David Mitchell. Mitchell argues that the Financial Condition Index (FCI), a transparency measure that looks at a revenue and budget priorities in towns and other municipalities, is disconnected from the reality of places such as the Main Street of the South Shore.

"How a tool that suggests coming $20,000 under budget in a $20 million town budget is somehow a risk and could be a useful tool is beyond me," Mitchell told LighthouseNOW in an e-mail. "That's just one of the many reasons the indicators are out of touch."

The mayor, now entering his second term leading Bridgewater's civic government, took to social media to dispute the FCI's latest findings, which showed the town among nine municipalities in a "high risk of financial instability" category, based on last year's financial data.

FCI takes into account 13 indicators, of which Bridgewater measured as a low or moderate risk, but categorized the town's overall assessment as high risk. Taxes, debt, deficits, and budgets are among the items measured.

A snow removal budget one time five years ago that proved too conservative, and one year of a budget projection off by less than one per cent, are among results that skewed Bridgewater's financial outlook.

The FCI "punishes" the town for upgrading underappreciated assets using capital reserves, Mitchell laments. The FCI also makes determinations on changes in tax base, which Mitchell points out is "totally out of our control," and fails to account for burdens on towns assuming the full cost of paving, plowing, and policing.

It's ... unfortunate that the [DMA] continues to use indicators that are disconnected from the reality of the situation in municipalities," Mitchell posted on social media. "It would be great if they could develop a more collaborative perspective on these matters."

A DMA spokeswoman said the FCI gives municipal leaders another important planning tool.

"These indicators were developed in collaboration with both the Nova Scotia Federation of Municipalities [NSFM] and the Association of Municipal Administrators [AMA] Nova Scotia," Krista Higdon explained to LighthouseNOW in an email.

"Before the results are published, staff work with the municipalities to validate the data and offer an opportunity for feedback. We will continue to work with municipalities to review and address any issues or concerns."

Mitchell says the FCI could be useful, but there doesn't appear to be interest in making improvements.

"I would add that asking for NSFM or AMA input into the indicators but then not taking that information into account isn't 'working in collaboration,'" Mitchell told LighthouseNOW in an email.

"Also, in speaking to my mayoral colleagues, it's clear that 'feedback' they seek is completely dismissed."

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