Problems around Saint John, ...

Politics Amalgamation was a fine idea, until the suburbs realized City Hall was broken. Trouble is, 13 years later it still is

On Nov. 18, 1996, roughly 125 residents from what was then the village of East Riverside crowded into the main room at the Riverside Country Club to share their opinions about amalgamating with the city of Saint John.

At first, everyone was polite.

By the end of the two-and-a-half-hour meeting, insults and catcalls were being hurled at Skip Cormier, the man who had been commissioned by the province to study amalgamation of the eight local municipalities into one super city.

It was not, the former general manager of Moosehead Breweries discovered during that first of many stormy public hearings, a popular idea.

As the crowd grew hostile Cormier tried to remain diplomatic. They were incredulous he was following the province's orders to study only five possible scenarios. They wanted things to stay exactly as they were, but Cormier insisted that wasn't part of his mandate.

"I want to talk to the organ grinder, not the monkey!" village resident John Marr barked into the microphone.

Cormier, who was hobbling on crutches after breaking his leg days before, stayed cool. But on this night and in the hearings to follow, he ran into a powerful argument from suburban politicians, who stoked it for all it was worth: Why would any suburban taxpayer in their right mind want a wasteful and inefficient Saint John City Hall running their community?

Cormier continues to believe that full amalgamation would be a good thing for the region, bringing the professional and business elite back to the city. He also knows it's unlikely to happen for the very reason raised more than a dozen years ago.

"The only way you could ever make a case for putting them together again is to clean up City Hall and have a good track record for five to 10 years, and go back and say, OK, let's look at this again.

"But until people believe Saint John City Hall is operating fully effectively, fully efficiently and all those things, you're just pushing water uphill."

**********

Many blame a complacent, comfortable culture at City Hall. Cormier, a consultant and the former head of the Saint John Board of Trade, has felt for years that common council and city management could do a better job.

During the amalgamation assignment that began in 1996, Cormier pushed hard for Grand Bay and the towns of the Kennebecasis Valley to merge with the city. He thought taxes could be lower for everyone if services were shared. The province was also willing to give millions more back in the form of grants.

The deal breaker was suburban revolt. The politicians railed against amalgamation at those public meetings and fiercely lobbied government MLAs. There were many reasons why people were opposed, but the coup de grace was the overwhelming feeling that the city was mismanaged and couldn't be trusted with their tax dollars.

Cormier, a city resident, understood the sentiment and included in his final report that full amalgamation should go ahead only if there was a performance review for city management and the city manager was hired on a five-year contract. The province ultimately watered down the plan, and Saint John remained on its own.

It was, Cormier believes, a big mistake. He thinks suburbanites should help pay for more of the infrastructure that Saint John provides as the region's economic engine.

Today, what remains missing from Saint John is program review and benchmarking against best practices elsewhere.

For years, the board of trade pushed for a full-scale operational review of city services. This practice has been used by successful provincial governments stretching back to the McKenna years, and the federal government of Jean Chrétien, to slay their monster annual deficits. Program review often results in job losses, hiring and pay freezes.

Pressure has been put on Saint John to do the same, but the city has always resisted. The closest it came was in 2005, when council hired the Toronto consulting firm Chartwell to do a review. However, the terms of reference, drawn up by council, transformed the enterprise into a review of the city's governance structure. The lead consultant, Alan Mitchell, recommended that the city move toward a committee system of government, similar to Fredericton's. Three years later, the project has stalled. The new council is having second thoughts about the whole thing.

City manager Terry Totten says he would welcome a full program review.

"Until very recently, councils in Saint John have been somewhat reluctant to hire outside consultants," Totten said. "Lately, we've swung the other way pretty quickly. But from a city manager's perspective, what would I have to lose? I have everything to gain."

Totten says staff will recommend a value-for-money audit to council later this year. It's based on a motion spearheaded by new councillor Carl Killen. Totten says he likes the idea of someone giving independent advice.

"I'll use this example. I have tremendous respect for the management of our fire service. Quality professionals. They inform me, they show me, they demonstrate to me (what they need), but it's still expensive. Why would I not just love to have someone - not an accountant, but operations people - to come in for $50,000 so I could say, 'I want you to review what I'm being told about the fire service and give myself and common council recommendations'. The next year, let's do our street services. I would absolutely love that."

Many say the audit is long overdue. Saint Johners who are fed up with the way their city is run have voted with their feet. The city's population has steadily dropped to 68,043 in the latest count two years ago from 89,039 in the 1971 census. That's a loss of nearly 21,000 people over 35 years.

The reasons for the exodus, of course, are many, but it's not hard to figure out where many of these people went. The suburbs, run by different councils and administrations, have ballooned as Saint John has deflated.

It can't all be blamed on foggier summers in the city, either.

Over the past 25 years, Saint John has had the highest property tax rate in New Brunswick, with the exception of one year, 1998, when its rate was a fraction of a penny lower than Moncton's.

The household water and sewerage bill, at $696 a year, is fourth-highest in the province, and the most costly of the three largest cities.

A city survey in 1999 showed that almost half the roads were in poor or very poor condition and had to be completely rebuilt. The jarring situation has not improved since. Drinking water does not go through a modern treatment system. People have to put up with an average of 80 watermain breaks a year, occasional periods of brown or murky water and, every so often, a boil order to protect them from illness. The fix is years away and the repair bill that will be passed along to ratepayers will be staggering.

Years of cuts to recreation programs mean sports fields, parks, community centres, arenas and the Canada Games Aquatic Centre have slowly decayed. Even tree planting was axed. The Simonds Centennial Arena was demolished nine years ago and nothing has replaced it. The annual recreation and culture budget is about half of the $14.7 million Moncton spends to attract young people and families.

An estimated 120 boarded-up buildings blemish the city, but the Building and Inspection Services department calls it an aesthetic problem and insists little can be done.

One in five Saint Johners is poor, yet they're subsidizing top-drawer salaries and benefits of civic employees, whose contracts consistently outstrip inflation.

The pension plan for city employees has been in the hole for seven years, despite local taxpayers bailing it out by more than $19 million. The 'going concern' deficit - the estimated shortfall to fully fund the pensions of future retirees - is said to be hovering somewhere near $70 million.

The city's annual operating budget is the largest among the province's municipalities, yet many people who attend ward meetings say service is the pits. Year after year, the city budget is late and the process provides for little feedback from the public on how its money is spent.

If nothing changes, and Saint John's economic surge peters out in a few years, it's not hard to believe the city's depopulation will continue. Given the long-term trend, Saint John could be out of people and out of business in a few generations.

**********

People who understand budgets and think about these problems say there's much more room for improvement at City Hall. To waste extra money that comes in thanks to the energy boom and soaring housing values would not fix the long-term problems that bedevil Saint John.

Cormier says if it wasn't for a healthier-than-usual real estate market in Saint John, the city would be in deep financial trouble. He's not impressed with the performance of common council or staff over the years.

"If there were a magical world where you could wave a wand, without restrictions from the Municipalities Act, I would put in a board of directors and a CEO, and performance targets ever year that are directed toward long-term outcomes."

In practical terms, many objectives could be accomplished, Cormier says. Take the tax rate, which for homeowners is $1.79 for every $100 of assessed property. Council could say to the city manager it wants the rate reduced by 10 cents over a decade. Each year, it would monitor progress in achieving that goal.

This could be one of five or six long-term goals that would be tracked each year. After each budget the politicians could ask whether the target was attained and if it was done effectively.

"At the end of the year, if the two sentences don't bond, guess what? The city manager hasn't done his job. And he's gone. That's the way it is supposed to work in a very simplistic terms. But it doesn't work that way."

A former high-ranking provincial official who would not consent to be identified, says Saint John City Hall lacks accountability.

"When I talk to people, they're never sure they're being told the true story. They can't trust city management."

Because of that lack of accountability, people get frustrated when issues don't get resolved. The ward meetings are a classic example. People show up who have beefs in their neighbourhoods, and the flash point is City Hall, which they believe ignores their concerns.

"You start to wonder whether they're going to get anything right."

Unlike the city, the province has detailed policy books setting out what management can and cannot do. In terms of accountability, a senior civil servant must answer to the minister, cabinet and central agencies. The checks and balances include the department in question, the minister and the auditor general. There's also the opposition debating in question period. In Saint John, almost everything goes through the city manager. This, the former provincial official believes, is one of the biggest problems.

"They all could be good, but they're caught in a culture. They're all very competent, but only in a certain way of doing business. They're not good at finding a more affordable approach. They're working on the basis that no one gets too pissed off at City Hall, rather than how can I get this done the most effectively at the lowest possible cost to taxpayers?"

In any government, he says, five to 10 per cent of the annual budget is flexible. The other 90 to 95 per cent is predetermined by existing agreements, not the least of which are labour contracts. So the question for council becomes, instead of fighting over the five to 10 per cent they quibble over each year, how do we wrest back control of the remaining 90 per cent? The provincial government, he points out, is currently under program review to find savings to avoid a huge deficit. Why isn't the city doing the same thing to find savings and stretch tax dollars?

To restore confidence, you need third-party validation.

"Bring in someone to assess or give a critical analysis of the existing management. The easiest way is benchmarking. How is the city performing against other cities?"