NOTE: The following is an op-ed from Municipal Affairs Minister Mark Furey on the Financial Condition Index.
Nova Scotia’s municipalities now have a powerful tool to help them assess their own fiscal health.
With the recent release of two more years of data, all Nova Scotians now have a clearer picture of the opportunities and challenges facing their communities.
I believe that can lead to better decision-making for all of us.
The Financial Condition Index is an annual report that looks at the areas of revenue, budget, and debt and capital assets for municipalities. The index can help municipal elected officials and administrators prepare budgets, identify capital improvements and develop business plans.
This initiative was a recommendation by the Towns Task Force, which identified long-term viability of municipalities as an important objective. The Towns Task Force defined viability as a state where a municipality is capable, both in the short and long term, of providing a basic level of service to residents and businesses at an affordable cost that is sufficient to support those services.
It recognized there are situations where the long-term viability of a municipality is in doubt, even though it may be doing fine at that moment. The Towns Task Force believed residents should decide the future of their communities. However, it was felt they must have adequate information to guide the decision-making process.
That recommendation led the provincial government, the Union of Nova Scotia Municipalities (UNSM) and the Association of Municipal Administrators to develop financial condition indicators. The Financial Condition Index is created from information provided by each municipality, which then reviews and verifies the data.
The index shows where a town or rural municipality is having challenges and allows them to engage citizens.
Cumberland County Warden and UNSM president Keith Hunter says the index is a good source of information showing how a municipality is doing and making it more accountable. The public is able to see how a municipal unit is doing, while elected officials and administrators can see what they’re doing right and what can be improved.
Greg Herrett, chief administrative officer for the Town of Amherst, believes the index is a good benchmarking tool and allows staff to analyze the results against others and have discussions with colleagues across the province. Amherst has had an inquiry from another town about its tax collection results.
Westville Mayor Roger MacKay says some of the Financial Condition Index indicators are out of the town’s direct control but it is making positive progress on others and appreciates the index as a tool to guide it to future success.
Kentville Mayor Dave Corkum says the index represents an opportunity for municipalities to do things in a different way.
I will continue to work collaboratively with municipalities and the UNSM to bring positive outcomes for citizens. I consider the index to be a valuable tool that allows the provincial government to work with municipalities, helping them manage these financial challenges. The intent of the Financial Condition Index is to have municipalities, citizens and the provincial government better informed about the financial health of our communities. This information will empower all of us to make good, evidence-based decisions.