With new taxation regulations by the Canada Revenue Agency coming into affect in January 2019 Council met on Tuesday, Oct. 10, 2018 to make necessary adjustments to the Elected Officials Compensation, Travel and Expenses Policy.
The current Policy was adopted by Council in 2001 and received revisions in 2017 after a review was done in 2016.
The Policy currently states one-third of the salary of Mayor and Councillors will be treated as tax exempt. In 2019, this will no longer be the case with non-accountable allowances to be paid to the elected officials as part of their income, which will result in a net pay loss.
Council voted 7-4 in favour of adjusted their salaries to account for the loss of net pay.
This will result in the Mayor getting paid $33,779 more with the salary being adjusted from $132,011 to $165,790 and Councillors getting paid $7,322 more with the salaries being adjusted from $38,878 to $46,200.
Administration had three other options for council to make the necessary changes.
No change to salary where the Mayor would see a net pay loss of $18,720.00 annually or $720.00 biweekly, with each councillor seeing an approximate loss of $3,840.46 annually or $175 biweekly.
Another options included Council reconsidering the salaries with full taxes where the Mayor would get paid $12,011 less with the salary being adjusted from $132,011 to $120,000 and Councillors would get paid $11,122 more with their salaries being adjusted from $38,878 to $50,000.
The last option would be similar but have adjustments to achieve the same net pay at one-third tax free where the Mayor would get paid 12,599 more with the salary being adjusted from $132,011 to $144,610 and Councillors would get paid $19,501 more with the salaries being adjusted from $38,878 to $58,379.
Councillor Sheila Lalonde put the original motion into action.
“So my paycheck won’t change,” said Lalonde.
Councillor Keith McGrath wondered how much of their salary could be donated to a non-taxable community charity that would allow them to take home the same pay however Administration was unable to answer.
“I can’t support the motion as it exists,” said McGrath. “To see a 10 to 12 per cent increase while we ask others to take a cut…it wouldn’t sit well supporting this and I would make a friendly amendment to send this back to Administration to explore other options that allow us to take home the same pay with a charity of our choice that we can get from Revenue Canada.”
Lalonde wasn’t in favour of the amendment, and rejected the motion, as she doesn’t what the government telling her how much she should donate to a charity.
Councillor Mike Allen agreed with Lalonde.
“I don’t think any of us ever ran for the money but I am aware that some of my colleagues had to make changes to their own jobs and the structure of what they do for a living,” said Allen. “They’ve had to turn down other potential work opportunities because of their position on council.”
Allen also highlighted how hard his colleague’s work for this community, something he says most people believe they are paid for the amount of hours work, not salary.
Councillor Verna Murphy echoed Allen’s agreed.
“We don’t do this for the money, we do this because we love the region, we love the work, we love the residents.”
“We’re just like any other regular, normal citizens in Fort McMurray. “We have child care expenses, we’re away from our families a lot in this role, and just being barley compensated for the hours I think is reasonable and I think the residents of Fort McMurray realize that when they are giving the facts with how much we actually make compared to the number of hours we put in,” said Murphy.
Councillor Phil Meagher echoed the support saying all they are trying to do is create balance but noted that never in his 24 years on council was he asked to vote on his own salary.
Currently only two other municipalities, Grande Prairie and Strathcona County have adjusted the salaries to maintain the same net pay. Edmonton and Calgary have implemented a fully taxed compensation model and do not requite changes to their policies.
After a 10-minute recess to review Councillor Lalonde’s motion, Mayor Don Scott let his colleagues know that he was against it.
“Under no circumstances can I support any motion that provides for changes in salary, whether it’s for an increase or not,” said Scott. “I’m philosophically am completely against us setting our own salaries…that’s something I believe as strong as I ever could in my heart…so I’m going to vote against the motion and I would encourage others to vote against it as well.”
Mayor Don Scott, Councillor Meagher, Councillor McGrath and Councillor Peddle all voted against.
The changes in salaries will be accommodated through the 2019 budget process.