Coun. Ron Roach put forth a worse-case scenario during a recent meeting of hamlet council when he delivered his municipal budget update covering up to Dec. 31 of the 2004-05 fiscal year.
The fiscal year ends March 31.
The hamlet started the year with a $382,000 surplus, but has seen a swing of about $673,000 since then.
Roach says the biggest expense this year was the $115,000 purchase of a housing unit for the SAO.
He says another contributing factor to the deficit situation is a lack of supervision within the municipality to ensure people are doing their jobs.
"The hamlet has a head mechanic, an assistant mechanic and an apprentice, yet we're constantly sending equipment to Toromont for repairs," says Roach.
"We have more than enough municipal staff to handle the equipment we have, so why are we contracting out?
"These are the types of issues that have to be addressed and soon!"
Roach reported a deficit of about $291,000, which includes the purchase of the SAO's house, grader repairs and $25,000 for a boiler at the air-terminal building.
The hamlet still maintains the boiler should have went as capital, not operations and maintenance.
"There was a verbal agreement between a hamlet employee and the Department of Transportation that we'd be reimbursed for the boiler by the end of the year, but that never happened.
"That's why it's a bad idea to enter into verbal agreements with government departments.
"If you don't have it in writing, you're toast."
Roach says artificial ice has pushed the arena's power bill to $80,000, while the budget is set at $41,000.
An additional $15,000 was spent on having a technician come up from Winnipeg to start the plant at the beginning of the year.
The hamlet is also suffering from having $207,000 outstanding in land leases.
Roach says if council would have approved a bylaw to impose interest rates on the land leases when the issue was first raised, the monies owing would not be this high.
"Anyone buying a $185,000 home is not going to incorporate the cost of a $55,000 lot into their mortgage if the hamlet is offering an interest-free loan over 15 years.
"And they're not going to have the same sense of urgency to keep the lease payment up to date."
Although there has been a huge improvement with debt collection, the hamlet is also owed more than $80,000 in municipal-service fees.
A process to take people to small claims court in an effort to recoup the money was derailed last year when the RCMP made mistakes while serving people, which made the process null and void.
The hamlet has since restarted the process.
Roach is projecting a total deficit of about $300,000 by March 31.
"Having said that, there are some revenues I did not include in my budget report that we should get back.
"A prime example would be the barrel-crushing project that was approved for $60,000.
"The hamlet was supposed to get that money back, but, as we speak, we've seen no paperwork whatsoever and the person overseeing the project has since moved on."
A spokesperson for the Department of Sustainable Development later confirmed to Kivalliq News that the hamlet would be reimbursed for the project, which was part of the recycling program in Rankin.
A last resort
Roach says municipal layoffs will only come as a last resort in an effort to bring the budget under control.
He says the hamlet has to start focusing on capital projects and target items within its means to obtain.
"I'd like to see each department provide a priority list of what it needs to run effectively.
"For example, everyone knows we're in bad need of a new Zamboni.
"It's fine to talk about major projects such as a new arena/community-centre complex, but we need to be more focused on what we can realistically obtain to operate within our budgets."