The exterior of Saint John City Hall is pictured in this file photo. (Staff photo)
The province has approved Saint John’s request to use leftover financial assistance funding to help with restructuring costs.
A letter from Premier Blaine Higgs says approximately $10 million of interim funding for 2020 can be used to affect front-line service cuts, in the city’s effort to fix its structural deficit.
This will require an amendment to the city’s financial agreement with the province.
“As part of the agreement…to get interim funding the city could not affect front-line services, and in 2020 as part of our restructuring efforts, we will be affecting front line services and therefore needed to ask permission from the province to do so in order to protect the interim funding for this year,” explained city manager John Collin during Monday night’s council meeting.
A request to have any additional funds carried over into 2021 has been denied for now, pending a review of restructuring efforts from the province in March.
In the letter, Higgs says it would be “premature” to make any financial commitments beyond December 31st, 2020.
Mayor Don Darling says despite their third request not being approved, it’s still a step in the right direction.
“The door is not fully closed. We’ll see where we are by the end of March, but those first two pieces are very positive,” he said.
Revenue And Restructuring
The city says the money will help accomplish goals set out by the three-part action plan last year, such as paying for a review of transit and operational audits.
The funds could also go toward the voluntary buy-out program, which will help the city reduce its management workforce and in turn reduce spending. Employment costs currently make up 57 per cent of the city’s budget.
Applications for the buy-out program are currently available. The cut-off date is February 28th, 2020.
Employees who are approved and accept the offer must end their employment on or before September 30, 2020.
“We’re talking about a very small number of people, management or folks that are outside of our union groups,” said Darling.
“I think what’s key here is that it’s a permanent reduction—it’s not a shuffling. That position will no longer exist in the future.”
The city says it doesn’t have any numbers yet around how many positions will be cut, but the city manager is not anticipating it will be very large.
The city can use up to $2 million to fund the process, but Darling says its too early to know how much of that will be used.
