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Penticton settles on 2 per cent tax hike

The Penticton council decided on a 2 percent tax increase with the balance coming from the general surplus reserve at their final discussion on the 2014 budget Wednesday.

The increase is needed to deal with the $682,000 deficit the council was left with at the end of their deliberations.

Councillor Wes Hopkin who suggested the amount to help offset the shortfall, said he chose it based on public input.

"Our citizens survey that came in earlier this year showed support for a small 2 percent increase, and for the last three years there has been no increase or even a decrease, and I didn't think that was sustainable going forward considering the deficit we were left with at the end of the day," he said.

Over the course of the budget discussions which started on Nov. 29, council dealt with the capital budget as well as the operating budget.

A funding shortfall of $203,000 was dealt with on the capital side by making cuts, resulting in a balanced budget there.

On the operating side, the city started out with a $1.2 million deficit, that by the start of Wednesday was whittled down to $935,000.

Helping the process along were both cuts and revenue sources recommended by staff.

One of the cuts that hit the hardest was to the Penticton Fire Department.

During the process, the council decided not to replace two recently retired firefighters as a way to cut 2014 budget expenses.

Mike Richards, president of Local 1399, International Association of Firefighters, who attended Wednesday's meeting, said he was disappointed with that outcome.

Of the three firefighters who retired this past year, only one was replaced, leaving the department to make do with 30 firefighters, rather than the previous 32.

"I'm disappointed because we told the city they need six firefighters, with three on each responding engine, and we are now not able to do that," he said. "But we will continue to do the best we can."

Prior to Wednesday, the fire department budget was approved in principle by the council.

The idea of more cuts, rather than a tax increase, proposed by Councillor John Vassilaki, was not supported by others on the council.

But Councillor Helena Konanz suggested a 1 percent increase with more out of the general surplus fund, while Councillor Andrew Jakubeit  liked the idea of a 1.5 percent increase.

Hopkin, however, reminded council that the surplus fund is a contingency fund if an emergency happened, and the council ultimately went with the 2 percent.

Mayor Garry Litke said he was very pleased with how the whole process went.

"The professionals made their assessments and they cut to the bone," he said, in regards to cuts suggested by staff. "And we are not prepared for any more cuts, then we start amputating limbs."

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