Proposed property tax increases for 2017 in Red Deer sat at 1.4 per cent on Tuesday, down from 1.52 per cent in January when the budget was debated by city council.
When the municipal rate is combined with the education tax set by the province and with the Piper Creek Foundation requisition to fund affordable housing for seniors, the total tax increase is reduced to 1.12 per cent for residential, multi-family and non-residential properties.
“With the final numbers in and the combined totals of the municipal component and the requisitions, the good news is it’s down from January and we’re looking at a 1.12 per cent instead,” said Mayor Tara Veer after council approved first reading of the 2017 tax rate bylaw on Tuesday.
She said the municipal portion dropped because there was more construction assessment growth than anticipated.
The bylaw will return for second and third readings on May 1. Taxes are due June 30.
The proposed tax increase would mean a typical house assessed at $325,000 would pay $2.13 per month more in municipal tax and $0.63 more in education tax. The Piper Creek Foundation portion would decrease by $0.07 per month.
The total tax increase would be $2.69 per month or $32 per year and would bring the total annual tax bill to $2,914 from $2,882 in 2016.
Education tax makes up 29 per cent of the average home property tax bill, and the city will collect more than $44.8 million on behalf of the province for education.
Municipal taxes makes up 71 per cent of the average homeowner’s tax bill. The city is collecting $128.3 million to fund city programs and services. Piper Creek Foundation requisition of almost $400,000 accounts for slightly less than one per cent of the tax bill.
Looking ahead to 2018 budget, council adopted a guideline that proposes a two per cent tax increase including one per cent for capital savings for next year.
“Last year when we contemplated the guideline, we started at 3.5 percent, we amended it to 2.5 and the budget ended up at 1.52 per cent.
So those numbers are always in flux but we have to give some preliminary indication of what we want the budget to address,” Veer said.
“We also identified areas such as community safety, environmental sustainability, operational efficiencies and innovations to ensure more efficient service to our citizens.”
For 2017, council froze recreation and transit fees. The 2018 guideline calls for fee increases of two to three per cent.
“The recommendation that came forward tonight is to not freeze fees next year because there might be substantial years of catch up when the economy returns to a growth year. But I think it’s a number we have to watch closely because if usage continues to be down, raising rec fees and raising transit fees doesn’t necessarily resolve the root of the issue,” Veer said.
On Wednesday a Budget 2018 Open House will be held at Festival Hall, 4214 58th St., from 4 to 7 p.m. for residents to provide their input to city council and administration on how to prioritize their tax dollars.