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Calgary budget: 5.2% proposed property tax increase for city homeowners

Calgary administration is pegging a total 5.2 per cent 2023 residential property tax increase for the typical single family residential property owner.

The City of Calgary unveiled their 2023-2026 service plans and budget on Tuesday, expecting a growth in overall budget of roughly $300 million by 2026. ($4.6 billion to $4.9 billion)

The average annual increase in tax collection over the four years is 3.7 per cent for all properties, the city said. Because of the difference in property assessment between certain property classes, single family homeowners will bear an additional 1.5 (total 5.2) per cent increase in 2023.

For a typical $555,000 single residential home, it means an increase of $118 for the year, or $10 per month. A typical condo, valued at $253,000 would see a decrease of $1 per month.

Calgary city council gave city administration a mandate to come in with an annual increase of 3.65 per cent in revenue required from property tax. That was to cover the cost of population growth and inflation.

Ward 1 Coun. Sonya Sharp said she was pleasantly surprised to see the investment priorities reflected in the budget number.

"I'm actually very surprised that they were able to follow the direction and stay within the population growth percentage. We know we told them to be innovative and they were," Sharp said.

"Saying that, we've got to keep that number where it is or a little bit lower if we can. That's the work that some of us are already talking about behind the scenes and what can we do."

Ward 8 Coun. Courtney Walcott called it a status quo budget.

"I don't love that. I don't love that purely because of the reality that Calgarians are looking for services," he said.

"Calgarians are looking for the city to provide safety, the city to address crime, the city to address transit, and the city to grow."

He believes discussions over the next couple of weeks will focus on the key priority areas of investment that will go above population and inflation growth.

Keeping expenditures low: City manager

The City has said that the average Calgarians' household expenses are going up roughly 7.2 per cent this year. They said they aren't immune to those same cost increases.

They said they've tried to maintain affordability by keeping expenses low.

“The investments we’re proposing will continue our progress to make Calgary a great place to make a living and a great place to make a life for all Calgarians,” said City Manager David Duckworth.

“We will continue to deliver the services Calgarians rely on over the next four years, while investing in Calgary to make it an even better destination and great place to live, work, grow and raise a family.”

Mayor Jyoti Gondek said this budget respects the will of council, and that Calgarians have just exited a pandemic and a recession.

"I think the big news today is that the direction that was given to administration back in the spring, reinforced in summer and then restated again September was make sure you come back with a budget that respects the fact that Calgarians are in a time of trouble right now," she said.

"So please adjust the budget so that it incorporates inflation and population growth but doesn't go beyond that. And I'm incredibly impressed that the team was able to come back within that budget envelope, if you want to call it that, without impacting service delivery."

The City has also planned a total of $10.2 billion in capital projects over the four years.

The overall increase in residential property assessment value is 13 per cent, taking into account single detached, condominiums and townhouses. Property values increasing more than the city average for their property class could see an increase higher than 5.2 per cent. If the assessed value is lower than average, that homeowner may see lower increase than 5.2 per cent.

All of these numbers are subject to an ongoing debate in council that will begin Nov. 21. City council has a variety of levers to pull, including changing the distributions, reducing some of the service lines, or adding to some of the service lines.

This budget does include a reduction in the city's mill rate. While property values are higher, they are reducing the amount of that increase, so they don't over collect, they said. While the mill rate is lower, the city is taking in more money overall because of the growth in the city's assessed value.

Budget areas seeing operating cash

The City is expecting roughly 88,000 new Calgarians between 2022 and 2026. While the city said it adds to the economy and vibrancy of the city, it also drives increased municipal costs.

The federal government recently announced new immigration measures, opening the door to even more people coming to Canada.

In the most recent Citizen Satisfaction Survey (Fall 2022), a slim majority (54 per cent) of Calgarians were willing to accept property tax increases at least in line with inflation to maintain services. A smaller portion was OK with a tax increase beyond inflation to improve services.  

City administration has outlined six areas that will see additional investments.

  • $41 million (ongoing) to improve mobility through improved transit service levels, expanded initiatives like On Demand and eScooters, and improved traffic safety.
    • $69 million (ongoing) to improve public safetyby supporting community service provider partnerships, increasing staffing and technology and reinstating a medical response unit.
    • $11 million (ongoing) to service the expanding system of parks and open spaces system.
    • $9 million (ongoing) to support economic development and tourism by delivering convention centre services, producing cultural attractions and providing services for entrepreneurs and innovators.
    • $19 million (ongoing) and $159 million (one-time) to preserve heritage assets, provide user- and business-friendly planning policies and deliver programs to revitalize downtown.
    • $3.8 million (ongoing) and $44 million (one-time) to set the foundation for work required to achieve 2050 climate targets.

Capital expenditures over four years

Along with the operating increase for certain departments, the city also highlights capital expenditures over four years.

  • $559 million for public transit to improve comfort and reliability, reducing maintenance and fuel costs.
    • $76 million in public safety, providing effective and reliable emergency response, plus critical infrastructure upgrades in 9-1-1.
    • $47 million in recreation, supporting active living, and improving accessibility and inclusivity.
    • $153 million in affordable housing to keep families and individuals housed, fostering safe, accessible and inclusive housing.
    • $170 million for downtown and main streets, improving the public realm, attracting investment and improving quality of life.
    • $42 million in reducing greenhouse gas emissions, mitigating climate risks, and preparing for the low carbon energy transition.
    • We will continue to make progress on city-defining infrastructure investments including the Green Line, the BMO Centre expansion and the Arts Commons transformation. We also continue to work towards an Event Centre and Field House.

“Calgary, just like the rest of the world, has experienced a lot of change in recent years, and we are still experiencing lingering impacts on our services and affordability,” said Chief Financial Officer Carla Male.

“Calgary is not immune to global challenges like inflation, the COVID-19 pandemic, economic downturns, and climate change. That’s why striking a balance between services and costs has been particularly important when developing the 2023-2026 Service Plans and Budgets. We have been closely monitoring our finances, maintaining a focus on streamlining the cost of government, and implementing innovative and customer-focused improvements.”