City staff estimate budget impact from COVID-19 in the millions

Photo: Brendan Kergin

Kamloops City Hall.

As businesses and individuals reel from the impact of COVID-19, the City of Kamloops is estimating it'll see a net decrease of up to $6.2 million in this year's budget.

In a report about COVID-19's impacts to the City of Kamloops, it's estimated the city could see between a $3.7 million to $6.2 million net decrease to its budget depending on how long the pandemic lasts. In an effort to deal with the expected shortfall, council discussed recommendations from administration during today's council meeting.

Options include property tax deferrals, suspending capital projects, adjusting service levels and delaying non-essential supplemental items.

Kathy Humphrey, the city's financial director, told council that they'll be identifying all projects that can be delayed while not causing safety issues.

She added that council needs to set a budget based on the best information now, and can amend things at a later date if need be.

The 2020 budget was in the midst of being finalized when the pandemic hit (the deadline to approve the budget and tax rates is May 15). To adjust to the new reality, council, on the recommendation of staff, has asked that a new report with a balanced budget be presented on April 21.

While no decisions were on the table, council spent time discussing property tax issues; the city's cash flow relies on property taxes, so deferring all the taxes could be problematic.

"I think we need to figure out how to get the people who are able to pay their taxes and utilities...to keep doing the things they normally do and help the people who can't," Humphrey replied.

She noted while there is some capacity in reserves and they can save money with reduced service levels (i.e. the closure of recreation centres or a decrease in other city-run services), the city still needs to defer large capital projects.

Mayor Ken Christian noted economic recovery from the pandemic will likely be longer than other emergencies.

"Some of the elements of our budget that we have built upon for years and years are going to be adversely affected by conditions outside of Kamloops," he said, using the recent growth at the airport as an example.

He added that while public health officials will cover health-care issues, council will have to focus on the economy.