Melfort City Hall (File photo/northeastNOW Staff).

By Aaron Schulze

Melfort's Projected Deficit

City of Melfort projects near $70,000 deficit following COVID-19 impacts

Jul 14, 2020 | 9:28 AM

The City of Melfort’s second quarter financial report – the first full quarter during the COVID-19 pandemic – showed a current operating surplus, but a projected deficit by year’s end.

During Melfort’s council meeting on July 13, treasurer Sandy Peterson revealed while the city has an operating surplus of $4,896,026 as of June 30, a projected deficit of $66,865 will be apparent by the end of 2020.

According to the memo, the current projected deficit is broken into six columns:

• Northern Lights Palace opening in the last two weeks of August – $5,948
• Kerry Vickar Centre opening to events on July 6 – $2,000
• Sport fields opening on June 22 – $6,700
• Vacant Safety Officer position – $31,390
• Cemetery maintenance and upkeep – $10,123
• Vacant landfill position – $10,704

Mayor Rick Lang said there have been changes to what city staff and council envisioned regarding the re-opening of facilities, as laid out in the provincial government’s Re-Open Saskatchewan plan. He said council hopes to have a balanced budget for 2020, but they’re preparing for the realization of a deficit.

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“If it develops, it’s worse than we envisioned, but it’s still manageable,” Lang said. “Originally, I think the plan was to manage staff and services so we could still balance our budget. There are still some expenses with respect to opening new facilities; potentially some re-training or new training based on the new parameters that we have to deal with… people will come and go, now there’s going to be a sanitization aspect to every facility we have open. There are potentially more wages that will be connected to the city facilities that will add cost.”

Lang said the City of Melfort is more “strapped” for cash with the city’s tax deferral period lasting until Sept. 30 and he believes an influx of revenue then can help with the projected deficit. The City of Melfort has collected approximately $1.4 million fewer in tax revenue compared to the end of June 2019.

“You’re not allowed to budget for a deficit,” Lang said. “When you run into unforeseen instances… if you happen to, at the year’s end, look at the final numbers and a deficit developed, you need to address that in the upcoming budget. That impacts the upcoming budget you’re going to look at. Everything impacts taxation. You have to be frugal, and yet deliver the services that are expected as best you can, with the dollars you have.

Lang said projections can still change as city staff look over the daily financial numbers and impacts related to the COVID-19 pandemic.

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aaron.schulze@jpbg.ca

On Twitter: @SchulzePANow