Hold the line on taxes: Chamber

Economy still too fragile to raise city taxes warns Chamber.

Red Deer’s business leaders are calling on the city to hold the line on taxes.

“During this extraordinary and delicate time in our economy, the city of Red Deer would benefit by exercising the fiscal restraint needed to realize a zero per cent increase to the operating budget,” says the Red Deer and District Chamber of Commerce.

City administration has proposed a budget with a 2.51 per cent tax increase for 2017. Council will begin its operating budget deliberations next week.

Interim chief executive officer Rick More points out only modest growth has been projected for 2017 and oil prices remain low. Further putting pressure on businesses are minimum wage increases and the carbon tax.

“Avoiding an increase to municipal taxes would prevent another cost increase from being layered upon business during this uncertain time while improving the economic recovery, and increasing the attractiveness of Red Deer as a place to do business,” says More.

Mayor Tara Veer said council is well aware of the economic pressures many are facing. When city staff came to council with budget guidelines calling for a 3.5 per tax increase last spring, council trimmed that to 2.5 per cent.

Also, council trimmed the capital budget by $26 million last month, reflecting council’s “strong sensitivity” to the economic climate and its impact on residents and businesses.

Of the 2.5 per cent tax increase proposed, one per cent is earmarked for a capital savings plan so less money will need to be borrowed for infrastructure and other projects in the future. Dropping that would mean revisiting the capital plan, said the mayor.

Another 0.22 per cent of the budget is directly related to the cost of the province’s carbon levy, which the city unsuccessfully tried to convince the province to make revenue neutral, said Veer.

That leaves council with a 1.29 per cent increase to work with as budget deliberations begin next week.

Veer said council will be taking a hard look at any increase.

“I fully suspect, without being able to put a specific number on it, council will remain strongly mindful of our responsibility to the public when we head into the operating budget.”

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