This article has been updated from a previous version, which provided staff's estimate that a two-per-cent vacancy rate would save $400,000. Staff have since indicated this was an overestimation and calculated the vacancy rate would produce a savings of $337,000. The story has been updated to reflect the latest information.
The Blue Mountains council is spinning the roulette wheel and betting that it will have a two per cent or more staff vacancy rate in 2025.
At its meeting on Jan. 27, council voted unanimously to build a two per cent staff vacancy rate into the proposed 2025 budget.
If the bet pays off, it means a $337,000 (or more, if the vacancy rate is higher than two per cent) savings in the draft 2025 budget. If the bet doesn’t pay off, it means the town did not collect enough tax revenue to pay its staff and will end the year with a deficit in that section of the budget.
At the meeting, council continued to review the draft 2025 budget and made its final effort to reduce costs in the budget to lower the projected tax increase.
As part of the discussion, Coun. June Porter suggested in the budget the town include a staff vacancy rate of two per cent. Porter noted that forecasting staff vacancies in budgets is commonplace elsewhere and the town should be following suit.
Monica Quinlan, the town’s director of finance and treasurer, said staff could build a two per cent vacancy rate into the budget. It would appear as a singular line in the budget book, rather than be split by department.
Quinlan said a vacancy rate of two per cent equalled $400,000 in savings on staff salaries and benefits (Note: staff later updated the projected savings to $337,000).
“Recognizing we may not meet that factor,” she noted.
An organization the size of the Town of The Blue Mountains experiences staff turnover on a regular basis as employees depart for other jobs or retire. Including a vacancy rate in the budget is a gamble that over the course of the year the time between staff departures and their eventual replacement will equal two per cent of the total salaries and benefits budget.
Adding the staff vacancy rate to the budget lowered the overall local tax increase, which council had cut to 5.86 per cent (this number rose to 6.15 per cent after staff updated the projected savings of the vacancy rate from $400,000 to $337,000) by the end of the meeting.