After reviewing the first draft of the city budget and making adjustments, city council has accepted administration’s newly revised budget.
In order to balance the budget, a projected 3 per cent tax increase for both residential and commercial properties was included as well as a 3 per cent increase for utility rate. The increase was made to help maintain the same level of services in the city while also continuing work on infrastructure.
Residents will see a $47-94 increase in property tax and an additional $2-8 a month on utilities. Commercial property owners will pay an additional $170-511 on property taxes and $3-180 a month on utilities.
Revenues in the operating budget were listed at $83,030,871 while expenses were $82,988,284 creating a surplus of $42,587. The capital budget sits at $57,672,463 in approved projects. Nearly $8 million was cut after revisions with the demolition of the LCSC being one of the projects deferred.
Other big projects such as the Highway 16 rehabilitation were kept in the budget as provincial funding has already been secured. Councillor Jason Whiting reducing the tax rate comes at a cost of city services and points towards the ongoing budget discussions in Edmonton as an example.
“They are looking to provide a zero per cent tax increase for their residents, however that comes with a substantial cutback to services. Some of them are the closure of not just one, but a few rec facilities in and around Edmonton. If that’s what they need to do to get a zero per cent increase then that’s what they need to do, but I’m very thankful we don’t have to do that.”
CFO Denise MacDonald mentioned a one per cent contribution to operational and capital reserves was also included in the budget. She says other municipalities are able to keep taxes down by drawing from reserves, however the city is trying to build their reserves in order to do that in the future.
“We are still putting money away in reserves, but we are still using it in different situations,” says Whiting. “I was wanting some clarification and it was good to here that we are helping to reduce the tax burden by pulling out of reserves.”
She also noted some adjustments were made to help support the Family and Community Support Services and economic development in the revision. Mayor Gerald Aalbers says the community’s message around the need for more economic development has been heard and the city will be adding some resources to bring it into focus.
“No one was prepared for COVID and the effects. Here we are now 9 or 10 months into it and we’re still facing it head on. I think every business appreciates the newsletters that are sent out regularly by our staff and trying to maximize other opportunities to pursue economic development at the same time.”
The increase will help cover the costs of hiring a business retention specialist who will aid local businesses recover from the pandemic as well as look at expanding the economic development opportunities.
Also included in the budget presentation was a 5-year projection for capital spending. It showed the city is expected to spend $76 million in 2022, $44 million in 2023, $31 million in 2024 and $71 million in 2025.
The projections for operations show a small increase of roughly $100,000 in 2022 and a $2 million increase in 2023. Whiting says the information is valuable as it sets some expectations for the future as well as helps the city prepare for any funding opportunities.
“It’s not written in stone, but it sure highlights the needs are community will have over the next five years at least. We can use [it] when accessing funding or government grants or when talking to elected officials at the provincial and federal levels.”
City council accepted the budget and the 5-year capital plan. The city will review it again in the spring once the provincial governments release their respective budgets.