In management accounting, when a budget is prepared from scratch with its base as zero, it is called Zero-Based Budgeting (ZBB). It promises to move organizations away from incremental budgeting, where last year’s budget is the starting point for the next. Instead, the starting point becomes zero, with the implication that past patterns of spending are no longer taken as a given. Essentially it is a method of budgeting in which all expenses must be justified for each new period.

Outside Training is Required: All budget managers must receive training for ZBB to be successful. However the rewards are huge. A conservative estimate is that the city could same $4.1 annually. Click or Tap here to learn more.

 Develop a five (5) year financial plan with the goal of reducing taxes by 2% per year until Owen Sound's taxes and expenses are relatively equal to similarly sized municipalities. This should include a Change Management Plan and a Communication Plan to ensure city staff remains engaged and focused on restraint.

Council must introduce Fully Burdened Cost Centers. Council and taxpayers deserve to see all costs associated with each department which includes an allocation of all support services such as IT, HR, Finance, Building Maintenance and most importantly the amortization expense for all capital expenditures for each department or cost center. Internal transfers are used to charge the Water Department to charge for services like IT and HR but departments, like the Art Gallery do not pay the Water Department for their water and sewer. Why? ... because the Water Department gets it's revenue from direct billing residents as opposed to taxes so the city is shifting the burden from taxes to water billing.

Just as important as setting the budget at the beginning of the year is being transparent about how departments managed their budgets at the end of the year. Did they overspend? Did they end the year with a surplus? Knowledge of how each department managed their budget throughout the year is essential to setting the following year's budget.

Transfering funds formone department to another can be used to hide inefficiencies. Enforce the concept of Restricted Funds and provide clear rules to eliminate the ability for budget managers to use funds on activities other than the reasons the funds were appropriated. For example, if Transit appropriates funds to cover the bus contract costs, as it did a few years ager, the budget manager cannot use these funds for anything other than the bus contract. Currently, since the year-end is not publically briefed residents have no idea how funds are flowing outside of the Council approved budget.

In spite of the Deputy Mayor committing to establihing a Budget Committee the city did just the opposite. Now only members of council will be on the committee. Owen Sound is blessed with a number of retirees with significan financial experience, some vastly exceeding that of city staff. Attracting them to site on a Budget commitee will give Council with another source of financial expertise. The Committee should be given the authority to send back draft budgets for reevaluation. Council needs to tap into the community and encourage seasoned business professionals to volunteer for this committee. Ideally membership should consist of two councilors and three Owen Sound residents with knowledge and experience in business and financial management.

All members of Council need to attend County Council Meetings as observers and speak at every opportunity to encourage the County to establish a Housing First program. Not all unhoused residents will accept accommodation with established rules. Once a Housing First program is established the city needs to roll out a "Zero-Tollerance" policy on illegal camping, possession of stolen property (Shopping Carts), loitering and intoxication in public. We need to make the path to recovery more attractive than remaining on the street.

Of 12 Grey County municipalities, the average tax burden is 4.4% of after-tax income. Owen Sound's is 7.7%.   When comparing Owen Sound's 2011 tax revenue to that of that in the 2026 budget we find that tax revenue grew from $22.0 million in 2011 to $38.1 million in 2026 that's an increase of $16.1 million. When we remove the impact of inflation this difference is reduced to $9.1 million. That's $9.1 million more than taxpayers would have paid if Council had capped tax increases to inflation. This essessive growth is largely due to the built-in inefficiencies and tendency to unneccessarily grow the workforce and hire consultants.  This is particulary damaging when you consider that Owen Sound's population is actually smaller than it was in 2011. Why did the administratin need $9.1 million more than inflation to run a smaller city? 

Owen Sound Taxpayers deserve a Tax Freeze!

Jim Hutton's 2023 study of Owen Sound municipal comparators showed the extent of management overstaffing. Owen Sound Service Review.  He compared Owen Sound to six other low-teir municipalities. Three of these were nearly identical to Owen Sound in population. total dwellings, population density, and owner occupied dwellings. He found that Coburg was the closest comparator.  He found that Owen Sound's workforce, excluding Protective Services,Library and Health Services was 36% greater than the average. More importantly he found that Owen Sound had in the order of 9 more managers than Cobourg. A couple of positions that stand out are; Corporate Services that is led by both a Director and a Manager of Corporate Services as well as a Deputy Treasurer, the Clerk’s Office that has 3 managers filling the role done by 2 managers in all other municipalities, HR has 2 managers where all others have only one, and then there is the Senior Manager Strategic Initiatives which is a position unique to Owen Sound.  Right sizing the workforce to at a minimum to match that of Coboug will save taxpayers $2 - $3 million annually.

Stop Changing the Rules and Start Building Owen Sound.  Owen Sound has a growth problem. The City's population was only 21,612 in 2021, up just 1.3% from 2016, while the broader Owen Sound area grew by only 2.8%—well below Ontario's 5.8% growth over the same period. More significantly, the City's population has remained remarkably stagnant for decades. If Owen Sound wants to grow its population, expand its tax base and attract new businesses, we need to make it easier—not harder—for developers to build.

Council should consider a five-year development stability period during which the City commits to no unnecessary changes to zoning, development rules, fees or approval requirements that could disrupt projects already being planned or make new investment less attractive. This commitment needs to be accompanied by a five-year suspension of charging Development Charges to give developers the time they need to roll out new projects in an attractive environment.

This would not mean abandoning planning, environmental protection or legitimate public consultation. It would mean giving developers something they desperately need: certainty. Developers invest where they can reasonably predict what a project will cost, what standards it must meet and how long the approval process will take. Constantly changing requirements, prolonged approvals and regulatory uncertainty increase costs and discourage investment.

Owen Sound cannot afford to make development more difficult or less profitable, when what we desperately need is more housing, more businesses, more jobs and more taxpayers.The City already has an Official Plan intended to guide growth and redevelopment over a 25-year period. Rather than continually changing the rules, Council should focus for the next five years on getting projects out of the planning system and into construction.The objective should be simple: build it, fill it and grow it. More housing brings more residents.

More residents create demand for local businesses. More businesses create jobs and expand the commercial tax base. More taxpayers help spread the cost of municipal services. Growth creates the economic activity necessary to reverse the cycle of stagnation. Owen Sound does not need another five years of studies, policy changes and regulatory tinkering. It needs five years of building. A five-year commitment to regulatory stability and suspended DCs will send a strong and clear message to developers and investors: Owen Sound is open for business, we welcome investment, and if you are prepared to build, the City will work with you to get it done.

We need to end the "Built-in Inefficiency". This is a common problem that we need to break: “The people who control the information are asking the people with less information to approve more spending.” That imbalance creates an inherent risk since the people who control the information are often the same people explaining why additional resources are required. Council must hold the City Manager Accountable. It is his responsibility to manage city expenditures in a cost-effective and financially responsible manner. It is also his job to ensure that draft budgets are adequately challenged and revised on their way to the council table. He must personally complete a detailed review of each draft budget when they make their way to his desk to ensure that each requested increase is fully supported with documentation and does not exceed the rate of inflation.

We saw the City Manager request a 71.9% increase to his budget at a time when city growth has been virtually stagnant for many years. He is not setting an example of “restraint” not “extravagance”. The problem is that the current city manager only has municipal management experience. Therefore he may not be seeing the built-in inefficiencies. Council should ensure that the next city manager comes with business and change management in a highly competive market.