| As a community, we have reaped the rewards of having “all hell for a basement” and owning mineral rights for extensive natural gas reserves. We enjoy a level of municipally-provided services that is equal to or greater than any community of our size in Alberta, and we benefit from lower property taxes and utility bills.
Today’s economic climate and our current financial position require that tough decisions be made. We are facing a $23 million shortfall in our annual energy subsidy to the City’s operating budget due to decreased commodity prices. Like any household budget, the City needs to balance money coming in with money going out. We cannot continue to provide the same level of services without finding new sources of revenue or containing costs.
Managing today’s challenges and continuing to invest in our community’s future is a must if we want our children and grandchildren to enjoy the quality of life we do today in our city. Responsible financial management, including decreased reliance on revenues from our energy production, will position the City of Medicine Hat to be sustainable over the long term.
We will need multiple solutions to help become financially fit for the future. We are examining how we can increase our return on investments, where we can cut costs and how we can generate increased revenue. We will also examine service levels.
Although we have money in established reserves, we must carefully consider what we spend now, and what we save for future needs, including abandonment costs.