2017 City of Red Deer operating budget “challenging”

2.51 per cent property tax increase projected; user fees frozen

“We have a lot of challenges,” City of Red Deer manager Craig Curtis said on Thursday when the 2017 draft operating budget documents were released.

The budget shows a property tax increase of $3.1 million (2.51 per cent). Before the pencil sharpening began, initial budget figures were close to a double-digit increase in taxes, he said.

Dean Krejci, the city’s chief financial officer outlined the budget summary, which shows an operating budget in 2017 projected at $357 million.

Of that, about $239 million is supported with tax and other revenue such licences and user fees. The rest comes from the city’s utilities component ($97 million) and self-supported operations ($21 million). Numbers have been rounded off.

The proposed budget breaks down as 1.29 per cent, plus one per cent for capital projects, and amenities and growth, plus 0.22 per cent to cover the new carbon tax. The provincial tax is expected to cost the city $280,000 in 2017.

As it stands now, the impact of the draft budget would be about $50 per year on a home with an assessment value of $325,000.

This does not include changes to the educational portion of property taxes, which won’t be known until the province releases its budget in the spring.

Curtis said the city is seeing a significant drop in revenues from Transit, recreation, and building permit fees. Some projects and objectives will have to be slowed down, but the city is focused on maintaining core services.

The economic slowdown in Alberta is mostly to blame for the tougher conditions the city is experiencing. An example of the impact is construction growth, which usually brings in about $3 million, is projected to be only $1.3 million in 2017.

Craig said a lot of citizens are struggling in this economy, and the city needed to be cautious.

On that note, the city intends to freeze some user fees for 2017, including those for Transit and recreation and parks facilities. The city also plans to increase its Fee Assistance Program for eligible residents.

Curtis noted that the province has decided to provide low-income transit pass funding to Edmonton and Calgary, but not to mid-sized cities such as Red Deer.

Mayor Tara Veer, on behalf of Alberta mid-sized cities, wrote to the provincial government last month expressing concern that they were excluded from the program.

Council begins budget deliberations on Jan. 10.

barr@reddeeradvcoate.com

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