Surrey Mayor Doug McCallum said he’s “deeply dismayed and shaken to the core” after learning the city is shouldering a $514 million debt load, but former councillor and political rival Tom Gill suggests the debt is being used as an “escape route” to renege on campaign promises.
In a release issued early Tuesday morning, McCallum said Surrey’s current debt is “simply untenable and frankly, irresponsible.”
The mayor vowed to “immediately bring the city’s spiraling debt under control.”
“When I was previously Mayor for nine years, I took great pride in running the city’s finances by saving first and avoiding debt. Council and I have agreed to immediately bring the city’s fiscal house in order,” McCallum stated.
According to the release, staff will be directed to prepare a budget that will “significantly cut down the debt by embracing the principle of pay as you go.”
“I want to assure the citizens of Surrey that the services and programs that the city delivers will not be impacted and they can expect the same high level of service as before,” McCallum said in the release. “What we will be doing as a council is determining what makes the most fiscal sense for our ratepayers and how to responsibly proceed with capital projects. In short, we will not mortgage the city’s future and will operate like a regular household by saving up and paying as we go.”
Staff’s budget report will be presented to the city’s Finance Committee on Dec. 11. A meeting of the committee was originally scheduled to be held last Monday (Nov. 26), but was rescheduled.
Gill, who lost his mayoral bid against McCallum on Oct. 20, said he has “great concern” that McCallum apparently had no understanding of the city’s financial position prior to making huge promises along the campaign trail.
And, he argued the debt load is reasonable for a city the size of Surrey.
“Not even three weeks ago, C.D. Howe Institute gave the City of Surrey an A+ on budgeting, transparency and financial reporting,” said Gill, who served as chair of the city’s finance committee during his time on council.
Indeed, on Nov. 13 the institute gave Surrey an A+, the highest it handed out across Canada.
“Surrey garnered an A+ for clarity and completeness of its financial presentation,” a C.D. Howe Institute release noted.
“How can we get accolades from such significant authorities throughout the world, recognizing transparency and documentation, and then for someone to suggest we have not been clear?” said Gill. “Doug’s using this as an escape route not to deliver on election promises he’s made.
“The folks of Surrey have been hoodwinked.”
Gill accused McCallum and his team of “reneging” on promises to make parking free at city hall, because they implemented a two-hour limit.
And, he doubts a municipal force can be realized in just two years, which McCallum has promised. All of which is related to McCallum’s comments related to the city’s debt, if you ask Gill.
Gill estimated it would take four to five years to set up a police force.
“We all know the cost of policing. I find it irrational in any business, for anyone to suggest they’ll make significant changes without information on what that cost is going to be. He’s hoodwinked the community on that.”
Gill also pointed his finger at McCallum for selling off city land during his previous mayorship.
When Surrey First came in, said Gill, they made “significant changes.”
Those changes included the creation of a road levy to invest in infrastructure, increases to development cost charges, as well as investing in civic amenities such as the Grandview and Guildford aquatic centres, the new city hall. He also mentioned projects in the works such as ice rinks in Cloverdale and Bridgeview, and a rec centre being built in Clayton.
“The premise Doug is suggesting, suggesting we have too much debt load? We didn’t have the new city hall, the downtown core, the relationships with SFU. These are all initiatives that really started under the leadership of Dianne Watts. We saw the big, bold vision of what it would take to create a new city.
“These are key civic amenities, and if you look at his track record in terms of investments he’s made, they’re virtually zero, outside of the Surrey Sports & Leisure Centre. In 12 years he was only able to deliver one significant civic amenity.”
McCallum has made big promises to Surrey taxpayers, and is implementing big and potentially costly changes.
At the first meeting of the new council on Nov. 5, motions were passed to pull out of the Surrey RCMP contract and establish a municipal force, and halt the light rail plan in favour of a SkyTrain extension.
Surrey’s contract with the RCMP, which runs Canada’s largest detachment, is set to expire in 2032 but carries with it a clause that the city can opt out within two years’ notice.
Under the contract, Surrey pays 90 per cent of the RCMP’s cost and the federal government is responsible for 10 per cent. With a new city police force, the city would have to cover the entire cost.
While a plan to shift to a city police force is being developed at city hall, it’s not yet known how this plan will financially impact Surrey taxpayers.
Along the campaign trail, the Now-Leader asked McCallum how he would achieve that.
“We would re-adjust our budget to cover that,” McCallum said at the time.
On the matter of taxation — everyone’s favourite subject — McCallum said, “We’re going to really look at the finances, because I don’t think they’re in very good shape, at least looking at their balance sheets, they’re not in very good shape.
“We also announced that we would hold any increases, if we need them, that we would hold any increases to the Consumer Price Index. That will be the maximum that we would go to, if we have to go to,” he said prior to being elected.
Since being sworn in, McCallum has also implemented free, two-hour parking on streets surrounding Surrey Memorial Hospital and at city hall, which is estimated to mean $850,000 in lost revenue for the city annually.
McCallum reiterated his tax promise at the Nov. 19 council meeting, telling reporters a municipal force, free parking and other campaign promises won’t mean a tax hike.
“That’s set in stone,” he said.
-With files from Tom Zytaruk