The Halifax Regional Municipality is axing nearly one-third of its jobs and cancelling summer programs as the city grapples with significant shortfalls from the COVID-19 pandemic.
Cities across the country are “bleeding cash” and will require significant help from other levels of government to stay afloat, said Mayor Mike Savage.
“Every single city faces the same challenge,” Savage said during a news conference Wednesday, hours after the city decided to defer the deadline for personal and commercial property taxes to June 1.
“No municipality can do this alone, and even with financial backstop, we face compounding problems. Running short this year — which is inevitable — will be made worse by a reduced tax base next year due to slow downs and closures in our businesses in 2020.”
The mayor made a plea to anyone who can pay sooner to do so, pointing out that property taxes represent 82 per cent of the city’s revenue.
Halifax must pay for essential services, including police, fire and transit, without that income. The city is also dealing with the loss of transit fares and any revenue that came from its municipal programs.
“I don’t want to unduly alarm anybody, but the fact is we get our money from property tax. And the rest of it — the other 18 per cent — we’re no longer collecting,” said Savage.
The city announced it has laid off — or will not be rehiring — 1,480 employees in all. Most of them are in the recreation department. Crossing guards and seasonal labourers are also being cut.
All of the positions are temporary, casual and seasonal workers. Of those, 900 are layoffs, but the city says it hopes to rehire those employees as soon as possible.
No permanent employees have been cut, but the city’s chief administrative officer Jacques Dubé said that’s possible in the future, as there’s no crystal ball to show what challenges are to come.
“This is a very fluid and unprecedented fiscal challenge,” said Dubé. “We are assessing our municipal budget daily and adjustments will have to be made going forward.”
Halifax Regional Municipality has about 5,000 staff in total.
The city’s move comes on the heels of other municipal cuts across the country.
In British Columbia, Vancouver, Surrey and Delta issued similar layoffs to staff at the beginning of April. Saskatoon has laid off 126 casual employees, including cashiers and lifeguards. Windsor, Ont. expects to save $135,000 a week after laying off 500 workers.
In Halifax, the layoffs means nearly all summer programming is off the table, including summer camps. Lifeguards who monitor the city’s beaches will also not be rehired.
Dubé estimates the city is working with a $233-million gap, but that number assumes services will be back up and running by September.
“This is not a scenario any of us anticipated, and certainly not one any of us desired,” he said.
Halifax was in a good position before the pandemic hit, Savage said, with a strong, fast-growing economy. He said that has helped to soften the blow, but the city will still need help.
“We don’t have the ability to borrow unlimited amounts of money and pay it off or add to our debt,” Savage said. “There are legislative handcuffs on us.”
He added that more difficult decisions are ahead, and the recovery will be long term.