How municipal spending affects your business

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CFIB's BC Municipal Spending Watch - Full Report.PDF

Municipal spending influences our daily lives; it determines our local services, our tax levels, and the state of our economy. But when local governments spend faster than cities grow, communities suffer.

CFIB’s annual Wage Watch Report for 2017 finds that this is exactly what is happening in British Columbia. This year’s edition of the report examines spending data from 2005 to 2015 (the latest year for which data is available). Over this timeline, BC’s inflation-adjusted municipal operating spending increased a whopping 46 per cent, while population only increased 12 per cent.

To be abundantly clear, this means that local government spending is growing nearly four times faster than populations are.

It is well known that when municipal spending increases, tax payers are the ones footing the bill.  When CFIB members were asked to indicate which issues are most important to their business, cost of local government ranked fourth. Unsustainable municipal spending habits cannot simply be ignored, as small business owners are feeling the financial burden which can threaten their very existence.  

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BC Municipal Operating Spending Growth (Adjusted for Inflation) and Population Growth, 2005–2015:

+Which of the following issues are the most important to your business?

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How the Municipal Spending Report ranks municipalities:

The Municipal Spending Report assesses performance by ranking municipalities against one another. The rank is calculated through an even split between two different measures: a municipality’s 2005 to 2015 spending increase and its 2015 per-person spending level, thereby placing an equal importance on a municipality’s long-term spending trend and its latest spending habits.

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Province wide highlights:

  • BC’s major cities, Vancouver and Victoria, increased their operating spending per person by 20 and 24 per cent respectively from 2005 to 2015, after adjusting for inflation and population growth (see Table 1). Both municipalities have also decreased in rank since last year, with Vancouver now ranking 64th overall and Victoria ranking 87th.
  • Only 7 out of 152 municipal governments in BC have kept operational spending at or below levels of inflation plus population growth over a 10 year trend. No major municipal government with over 25,000 residents made the list.
  • In 2005, average BC municipal operating spending per capita stood at $927. In 2015, that dollar amount increased to $1,209 per person when adjusted for inflation, representing a 30 per cent increase in operating spending per capita from 2005.

For all results and findings, please refer to the full report.

 

 

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