Tax increases outstrip inflation again
Red Deer city council continues to hammer the taxpayer with tax increases exceeding the Canadian inflation rate or consumer price index (CPI). The tax rate for 2014 has been pegged at 3.93 per cent, although this has not been finalized.
The last five years of tax increases are as follows, with the CPI in brackets: 2013, 4.28 per cent (0.91 per cent); 2012, 4.3 per cent (1.5 per cent);
2011, 3.9 per cent (2.9 per cent); 2010, 3.31 per cent (1.8 per cent); and 2009, 5.5 per cent (0.3 per cent).
In contrast, Toronto, North America’s fourth largest city, had tax increases of 2013 (two per cent), 2012 (2.5 per cent) and 2011 (2.5 per cent). In 2011, they cut some staffing levels, including police, and reduced hours at some facilities to cut expenses.
In 2012, Stockton, Calif., a city of 300,000 people near San Francisco, filed for bankruptcy. Factors cited were unmanageable public employee pension debt and out-of-control salary obligations. On July 4, 2012, Reuters posted an article entitled Stockton bankruptcy the result of 15-year spending binge. This article is available online and has some parallels to Red Deer’s spending.
Since then, several U.S. cities have followed suit, with Detroit being the most publicized.
Recent budget deliberations did not appear to go far enough. Days after an article in the Advocate indicated crime was down, several new positions were added to the RCMP. Parks and Recreation received a $1-million increase.
The year after year percentage tax increases are not realistic and not sustainable. The above doesn’t even include potential tax increases for the 2019 Canada Winter Games, a 50-metre pool or any other big-ticket item that will in all probability be proposed.