Edmonton homeowners could see a seven per cent property tax hike next year.
It’s a bigger increase than the roughly five per cent bump approved by city council during budget talks last year, with city officials saying it’s needed in the face of high utility costs and faster population growth than expected.
A report on the proposed budget adjustments released Thursday says city administration “recognizes the impact of a 7.09 per cent increase in the context of an affordability crisis.”
But City of Edmonton chief financial officer Stacey Padbury said the city is facing its own challenges with growing costs and reduced revenues.
“We acknowledge that Edmontonians are feeling a pinch. But we’re also experiencing much of the same thing,” she said.
“We’re not asking for any additional services. What we’re focused on is delivering the services that Edmontonians have come to rely on in a consistent manner.”
The city is projecting a $73.8 million deficit, and Padbury said that’s mostly because of the arbitrated settlement that was “higher than expected” — they have to cover $19.7 million in Edmonton Police Service salary increases after an arbitrator ruling this year.
The city is spending more on police after council approved a new EPS funding formula, with ongoing costs starting with an additional $11.8 million for the force in 2024.
The city plans for cost increases over the four-year budget cycle, but Padbury said some expenses rose higher and faster than they predicted.
Council will consider the recommended budget adjustments next month and vote on possible changes.
Ward Anirniq Coun. Erin Rutherford told CBC News she expects Edmontonians to be “rightfully upset” about the prospect of a larger tax increase.
But she said she isn’t surprised to see the numbers, given the pressures of inflation and population growth, and some of council’s recent choices about city funding.
“I have said no to many of those decisions, including the [EPS] funding formula … being very acutely aware of affordability being a factor,” she said.
“Now that we’re here, I don’t see how we get out of this situation without severe cuts that would hurt in places that people won’t want to see cuts.”
Mayor Amarjeet Sohi said Thursday that council will be going through the budget adjustments “line by line” to find savings, and lower the tax rate increase.
But he said core services are already stretched. He’s wary of cutting into those budgets or turning to city fees and raising the cost of transit fares or admission to recreation centres.
“Affordability of service is so important, particularly for those low-income and middle-income Edmontonians. Without access to affordable services, their cost of living will be much, much higher,” he said.
During last year’s budget talks, council directed city staff to cut $60 million over four years in services and programs, and that work is ongoing.
“The fundamental pressure we have is the day-to-day operation of the city,” Sohi said.
Ward pihêsiwin Coun. Tim Cartmell wrote a blog post Thursday slamming the proposal for a seven per cent tax rate hike as “simply unacceptable.”
“I know people and families across Edmonton are looking at significant increases in grocery bills, power bills and other basic living costs that simply cannot absorb a significant property tax increase,” he wrote.
The added cost to individual property tax bills will depend on the value of the home.
City officials say under the currently proposed increase, the average Edmonton household will pay about $750 in property taxes for every $100,000 of assessed value.
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