Residents of mountain towns west of Calgary could be facing steep tax increases as municipalities face increased financial pressures coming out of the COVID-19 pandemic.
Banff’s city administration has proposed a 10.2 per cent increase in this year’s municipal budget, while those living in Canmore could see a 12.3 per cent jump. Meanwhile, their urban neighbour Calgary recently approved a smaller 4.4 per cent property tax increase over the next year followed by 3.3 per cent increases in the rest of the budget cycle.
Canmore Mayor Sean Krausert said his administration has brought forward a budget that despite the large percentage hike, represents a status quo budget as third-party costs on the municipality have increased.
“It’s important that you don’t just look at the percentage,” said Krausert. “They don’t tend to tell the whole story. It’s actually a 12.5 per cent tax increase that the administration put to us for a status quo budget. . . for the average assessed home, that relates to $18.50 a month increase. Whereas if you look at Calgary, a 4.4 per cent tax increase, so one-third of ours, amounts to a $12.08 increase.”
Krausert said his community is facing a number of third-party cost increases that are driving the jump in their tax proposal. He said contractually they are taking on a bigger share of policing costs with the RCMP as their population has grown as well as having to account for inflation. The municipality also has to account for issues arising from the COVID-19 pandemic, which has added a 2.4 per cent jump by itself.
“Those uncontrollable third-party expenses relate to a 5.8 per cent increase to our taxes, the cost of living adjustments for employees due to inflation, that represented a 4.2 per cent increase to our taxes,” said Krausert. “Then higher interest rates amount to 1.07 per cent increase, all of that added together is over 13-and-a-half percent.”
Banff Mayor Corrie DiManno said her municipality is facing similar external pressures after their communities economy was drastically hit by COVID-19. She said they have also previously committed to adding police officers that they need to account for while also ensuring town staff is fairly compensated amid record inflation levels.
“Really, this 10.2 per cent tax increase is showing a coming out of that deep cut that we made (during the pandemic),” said DiManno. “This budget really shows us trying to bring those reserve levels back from what we cut, as well as inflation, as well as focusing in on the significant cost of bringing our staff wages up to comparator municipality levels.”
DiManno said the silver lining is that the town is bouncing back from COVID-19 as tourism continues to rebound and they are able to welcome more guests. She said they anticipate they will be in a healthier financial position moving forward.
Despite the jumps, Krausert said he believes residents understand the pressures municipalities are facing and understand that the budgets as presented are to keep services at current levels.
“The amount of taxes that I pay each month on my home is less than my cellphone bill and I get so much more with my taxes, based on garbage collection and street clearing and administrating the community in which I live,” said Krausert.
Paul McLaughlin, president of the Rural Municipalities of Alberta, said the situation in the Bow Valley communities is not dissimilar from other small municipalities around Alberta. He said while there have been increases coming from outside the province, there has also been a downloading of costs from the province onto municipalities and a reduction in funding.
“I would say that 40 per cent of the problem is directly attributed to lack of transfers from the provincial government to municipalities, urban and rural, across the province,” said McLaughlin.
He said that as municipalities are facing higher costs, they also have less of a windfall stemming from a number of changes the province has made. He called on the UCP government to restore funding to prior levels, to the tune of approximately $800 million, in the 2023 provincial budget.
Requests for comment sent to the province were not returned Saturday.