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Council ups wages to offset tax impact

Yorkton Council has passed a raise for the Mayor and Council, but they will take home less money in 2019.
wage

Yorkton Council has passed a raise for the Mayor and Council, but they will take home less money in 2019.

Section 56 of the Cities Act states that each member of council is to be paid any remuneration and benefits and any reimbursement or allowances for expenses that may be fixed by the Council. Currently, the Cities Act states that one-third of the total remuneration paid to a member of council is deemed to be paid with respect to general expenses incurred that are incidental to the discharge of the duties of a member of council. Historically, if non-accountable expenses made up one-third or less of the remuneration of the elected official, this amount would not be included in their taxable income, detailed material circulated at the regular meeting of Council Monday.

The “2017 Federal Budget received Royal Assent on June 22, 2017 and presented a legislative change to eliminate tax exemptions for non-accountable expense allowances paid to elected officials effective Jan. 1, 2019. The Federal government’s position on the non-taxable amount is that it ‘provided an advantage that other Canadians do not enjoy.’ City councillors in Yorkton do not receive allowances for in-town travel, office, communication expenses, or attending additional meetings and community events,” Jessica Matsalla, Director of Legislation and Procedures -- City Clerk with the City, told Council.

The change in the federal tax policy will result in municipal council members across the country paying more income tax on their remuneration.

Yorkton Council pays council members based on a formula created a number of years ago.

“Six years ago, in September 2012, a group of community leaders were asked to form a committee to determine a fair council remuneration policy. The committee suggested in their report that the earliest review for possible adjustment should be a minimum five years from its adoption. In their research, the committee considered cities in western Canada that were comparable in population to Yorkton, as well as the Provincial Cabinet Minister’s salary to develop a structured, transparent formula for Council’s remuneration. Council accepted the committee’s recommendation to establish the Mayor’s remuneration at 75 per cent of that of a Saskatchewan Member of the Legislative Assembly (MLA). The Councillors are set to receive 30 per cent of the Mayor’s salary plus an equal share of 3.33 per cent of the Mayor’s salary when they serve as the Deputy Mayor for two terms of four-months. (i.e.: six councillors x eight months = 48 months),” detailed the report.

“Administration is of the opinion that the net pay of a Mayor/Councillor should be the same going forward as it has been historically,” said Matsalla.

Changing the formula to be 85 per cent of a MLA’s pay and councillors at one-third of the Mayor’s remuneration gets the City as close to status quo as possible, she said.

The total added cost per year of the change will be approx., $27,000.

Councillor Aaron Kienle said while Council might not be exactly comfortable with voting itself an increase, it also does not make sense the Mayor face a 13 per cent decrease in take home pay, and Councillors nine per cent.

The federal changes certainly bothered Mayor Bob Maloney.

“It’s an issue that infuriates me,” he said, adding it hits people in municipal politics who “do it because they’re doing it for their communities.

“This gets me a little annoyed and excited.”

Council would pass the increase, but Councillors Darcy Zaharia and Quinn Haider sat opposed.