Budget Forecast: 2011
The following ran in last week’s Edmonton Examiner as part of our monthly ‘Councillor Connection’ column. It is reproduced here for reference.
Last week Council established 2011 budget guidelines for City Administration to work towards.
As with last year, Council set a target for an overall tax increase of 5% for 2011.
I recognize that very few Edmontonians’ incomes will increase that much in 2011, and that tax increases that exceed inflation are especially difficult for those on fixed incomes.
I wish that municipalities in Alberta had access to other forms of taxation, (such as the sales taxes US cities have, or a dedicated portion of the income tax like Winnipeg gets), which would be far more progressive, and would reduce our over-reliance on property taxes. In this vein, we will be looking at whether there are some user fees that could be increased to support certain services rather than taxes.
I should stress that the main drivers in the proposed increase are infrastructure related.
The guideline includes a 2% charge dedicated specifically to investments in neighbourhood roads, curbs, and sidewalks. This would be the third year of 2% increases in a row for this program, which altogether will increase investment in neighbourhood reconstruction and preventive maintenance by more than $50 million annually.
At this rate we’ll be able to tackle the backlog of work in mature neighbourhoods within 10-20 years instead of 50-100, while also preventing newer neighbourhoods from falling into the same disrepair.
There are also debt service costs associated with the major road and bridge projects we see unfolding around us, as well as the new recreation centres. These payments alone are equivalent to almost a 3% tax increase.
There are other costs under pressure from the growth of the city – i.e. the more we spread out the less efficient our emergency services, waste and transportation systems become. These operating costs are rising faster than the tax revenue we get from new development.
In other words, continued sprawl is pushing costs, and in turn taxes, up.
On the bright side, previous years’ larger increases were also driven by a combination of increased infrastructure spending and labour market pressure. With the economic slowdown we can anticipate a more moderate cost of labour for the city, and better pricing on infrastructure, which is why we’re eager to push ahead with more LRT.
I moved from BC very recently and am surprised not only by the fact that there is no homeowners grant for seniors…which means I am paying $1000 more annually in property taxes here as well as condo fees are out of this world compared to what I paid for a larger condo with many many amenities. Why was the homeowners grant removed some time ago. I am on a fixed income and might have to return to BC to have more money to spend.
Thank you. Please consider the Seniors and give them a break with a cut on those high property taxes.
Mr. Iveson:
Yes I to am a Senior who ownes his home and also lives on a very tight fixed income. As you know any increase in my cost of living is not reflected with a increase in my income to off set it.
I have freinds who love in BC and they have a “Seniors tax credit” on the their property tax.
Question: Why not Edmonton???Why not Alberta???
Answer: Is it because we do not have a Sales Tax???
I await your comments and support, Just as I have suported you in Ward 10 election.
Dennie and Gena: thanks for commenting. I understand after speaking to many people on fixed incomes of all ages the challenges households are having with all costs, especially taxes and utilities. There is some modest relief you may qualify for under the city’s Seniors Homeowner Grant Program and the Provincial Education Property Tax Relief, which provide a combined rebate to eligible seniors.
Ultimately what people with limited incomes need – whether they rent or own – is income support, and that’s a Provincial responsibility.
Much as I might like the city to provide more relief in cases like yours the challenge is that we have 5 cents out of the average Edmontonian’s tax dollar, while the province has 26 and the feds have 69. We are not in a position to provide income support, and if we did it would have to come at the expense of other property tax payers. That said, we do provide preferred pricing for seniors for a number of city services, such as the senior’s bus pass which is $114.50 per year, and a low-income seniors means-tested pass for $49.50 per year.
So I believe we are doing what we can in areas of our mandate. I do hear you, though, and it’s one of the reasons I voted in favour of a resolution at the Federation of Canadian Municipalities calling for Canada Pension Plan reforms to help seniors cope with rising costs of living.
I also believe the city should examine using surplus school lands for housing for seniors who might be ready to downsize but who are hesitating because there are no options nearby; and many of these sites are in areas with aging original-owner populations. It’s an idea I want to pursue as we consider the next round of sites, and perhaps even look to previous sites designated for the townhouse in the first phase of the First Place (aka First Time Homebuyers’ Program).