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City of Red Deer’s 2024 budget deliberations delayed to January

The financial picture is not as expected, says a general manager
Red Deer City Hall. (Advocate file photo.)

The City of Red Deer’s 2024 budget, with an anticipated 4.12 per cent tax increase, might have to be re-assessed in light of rising costs and still lower than normal revenues.

Mike Olesen, general-manager of growth and finance, said the city’s financial picture is not as expected.

City council approved a 2023-24 budget last year to help with planning for the future. But the challenge of having a two-year budget cycle is that financial matters — including the economy and inflation rate — can change a lot in a year.

While Red Deer city council had set Monday as the start of the 2024 budget discussions, these meetings were postponed to Jan. 23-26 to allow city administrators to get a better handle on what municipal costs and revenues will actually be at the end of 2023, said Olesen. “There might need to be some adjusting…”

The City of Red Deer faced higher than anticipated costs because of inflation, he added, while the community continues to slowly rebound from the pandemic. Olesen suggested city revenues, in terms of user fees, have not gone back to normal in transit, recreation and other areas: “We are still in a period of recovery.”

This doesn’t necessarily mean city council will be considering a higher tax increase in January.

If there’s a budget shortfall, some money could be taken out of reserves to cover it, or some expenses removed from the 2024 budget, said Olesen. That will ultimately be up to city council to decide.

He maintained overall costs and revenues have been “evolving” over the course of 2023, and could end up in a different place on Dec. 31 than when the 2024 budget was planned a year ago.

“We need to understand if it has changed, and to what degree,” Olesen said, so it made sense to postpone 2024 budget discussions until the city’s financial standing at the end of 2023 is fully known.

Lana Michelin

About the Author: Lana Michelin

Lana Michelin has been a reporter for the Red Deer Advocate since moving to the city in 1991.
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