Rainy day fund can balance $14.4-million deficit, Edmonton mayor says

Edmonton's rainy day fund canbalance the books on the city's projected $14.4-million deficit in the 2018 budget, Mayor Don Iveson says.

"We'll be OK," Iveson said Tuesday after council got an update from the financial and corporate services branch.

"We'll be able to absorb it. It's why we have a stabilization reserve, which we put money into when we have a good year where it snows less."

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So far this year, the city has saved $5.5 million in snow and ice control, spring clean-up and maintaining its fleet of vehicles in the city's operations branch.

The city's finance branch said aspecial dividend of $9.7 million can be used from the Ed Tel Endowment Fund.

The deficitwas partly tied to higher fuel costs, lower tax revenues from social housing and increased personnel costs.

Social housing properties owned by the province are considered exempt from taxation. The Alberta government no longer provides grants in lieu to make up for the tax exemptions for those properties, the report to council shows.

The city projects it will spend $8.7 million more than what it expected to on fuel costs.

The city collected about $2 million less than expected from ridership on public transit.

Fewer big infrastructureprojects such as recreation centresare expected in the coming years, but the mayor said council is firm the city won't neglect the necessities.

"We're not going to sacrifice basic maintenance, we've seen what that looks like in Edmonton," he said. "It looks like potholes, it looks like facilities deteriorating ahead of schedule. That's actually a different kind of waste of money."

Iveson said a projected $14.4-million deficit is within the "normal ebb and flow" for a $2.6-billion budget.

In October, council will start debating the next four-year budget.

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Council will aim to keep property tax increases to a minimum, Iveson said, given that residents and businesses have been paying increases over the past 10 years.

"We're going to need to flatten things out. I don't think we can go to zero, but we're going to need to try to bring it closer to population plus inflation."

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Iveson said the city is still waiting to hear from the province on arevenue-sharing deal from cannabis sales, and how it intends to replace the Municipal Sustainability Initiative, or MSI, a fund for infrastructure that will run out in three years.