A Solution to House ALL Owen Sound Residents

The solution to end homelessness can be found in my last study comparing Owen Sound to 12 other municipalities. Essentially what I concluded from doing this research is that Owen Sound's expenses are at a minimum $5.0 million more than similarly sized municipalities and likely as high as $10.0 million. It appears city hall is overstaffed. Realizable reductions in expenses can be achieved within a year by applying sound change management and financial management techniques. This will immediately free up at a minimum $5 million and possibly up to $10.that can be reassigned to roll out a Housing First Program. My complete conclusions and recommendations are below.

Figure 7; Total Expenses per Capita      source: Audited Financial Statements the Municipal websites

Figure 7, shows total expenses per capita. When we look at our Primary Comparative Group, as shown with red lettering, we see that Owen Sound once again leads this group by significant margins. We see that Strathroy is quite a bit lower than Owen Sound in total expenses. However, Middlesex Centre is the closest this time with expenses per capita of $1,500 compared to Owen Sound at $2,399. Although it does look like much, the difference of $890 per resident is a huge sum. When you multiply this by Owen Sound’s population it works out to be a difference in expenses to run the city of $19 million. Middlesex does have a slightly smaller population so it could be that they do not provide the same level of services that Owen Sound provided its residents.

This supports the data from the previous two sources and removes the uncertainty of contracted out services. It makes it clear that one of the reasons that Owen Sound needs higher taxes is to support the abnormally high expenses as compared to Strathroy, Middlesex, Tillsonburg and Springwater. Again, the reason for this could be that these municipalities are providing fewer services; hence, it costs less to run their municipalities. The only way to know for sure is to do a detailed service comparison with all four of these municipalities. If they are providing the same services, at the same level, whether contracted or not, then the solution is simple, reduce Owen Sound’s expenses to match theirs. As we saw above this will likely require a reduction in the workforce.

When we look at what the Sunshine List is costing us each year, beyond what Strathroy-Caradoc pays, it becomes clear why our Salaries and Benefits expense is so high as compared to Strathroy. Owen Sound pays nearly $4.9 million more on Sunshine List salaries than Strathroy-Caradoc. This suggests that senior staff salaries have grown well beyond the city’s growth? This didn’t happen overnight. I suspect that it occurred over a twenty (20) year period with annual incremental changes that would go unnoticed in any particular budget year. Regardless of how we got here, it appears that the city has an overabundance of senior staff in comparison to Strathroy. Council owes it to taxpayers to fully investigate this disparity and direct the changes necessary to right-size management staff. However, given the magnitude of this disparity, it will take a few years to correct this apparent imbalance.

In Part I of Comparing Owen Sound Employees, under the Expenses Tab, we saw that Owen Sound’s Salaries and Benefits Expense was, at a minimum, $11.6 million more than what it should be based a comparison with Strathroy. In Part II of Comparing Owen Sound Employees, we learned that Owen Sound has 73 senior staff earning $100,000 or more, while the closest municipality to Owen Sound in the study, Strathroy, has only 34 senior staff on this List. That tells us that Owen Sound could save at least $5,0 million each and every year if it just matched Strathroy’s numbers on the Sunshine List.

There is no question that over the years successive councils have allowed expenses in general to increase each year. From the relative difference between Owen Sound and Strathroy, in Salaries and Benefits Expense it clear that Owen Sound’s Expenses are abnormally high.

 

The Facts

  1. The Average Household Income in Owen Sound is the lowest in Southern Ontario at $75.861. However, the Median Household, After-Tax, Income was only $57,000 in 2021. That means that half of the households in Owen Sound have only $1.096.15 to house, clothe and feed their families.

  1. Owen Sound residents have to pay 1.2% more of their income, than Collingwood residents, to cover their taxes each year. For someone earning $76,000 per year this works out to about $1,000 per year. For renters you can be sure that your landlord passes the cost of the annual tax increases to you.

  1. The Median Value of a dwelling in Owen Sound is $117,000 less than that in Collingwood. You would think that would result in lower taxes given the lower property values. But the data shows otherwise.

  1. The city of Owen Sound’s expenses are dramatically more than those of Collingwood. In spite of Collingwood being the larger municipality, Owen Sound’s expenses for Salaries, Wages and Benefits were nearly $4 million more than Collingwood’s in 2020.

  1. Thirty-six of the 73 employees with salaries greater than $100,000, were employed in Police Services.

  1. Owen Sound pays $11.6 million more in Salaries and Benefits than Strathroy and could save at least $5.0 million if it just matched Strathroy's number on the Sunshine List.

In summary, it is clear to me that Owen Sound has expenses that, at a minimum, are $5 million more than they really need to be. On a positive note, a portion of the annual savings that will materialize from expense reductions should be directed to address our growing social problems. We currently have a very serious problem in our community where some of our residents are living in tents and sleeping in the streets. We saw that Owen Sound spends in the order of $12 million more on salaries and benefits than Strathroy. If Council were to begin to practice sound financial management and reduce expenses, by at least $10 million, to be close to Strathroy’s, we could provide housing for the 50 plus unhoused residents in Owen and at the same time have enough left over to give taxpayers an immediate 10% reduction in taxes as well as freeze taxes for the next five (5) years.

The feedback I received when offering solutions, to mitigate the pain felt by these residents, was that this is a “County Problem”. I disagree with this analysis. Although the County is attempting to address this issue for all municipalities in the County, it is a City of Owen Sound Problem and I’ve just given you the solution.
 

Return to Top