Calgary city council agreed to stick with prior-approved tax increases for 2025 and 2026 and to find reductions in operating expenses to reduce taxes or invest in priority areas.

The motion came forward from Ward 12 Coun. Evan Spencer during the Feb. 27 regular meeting of Calgary city council, to help bridge a divide created after Calgary city council approved a 7.8 per cent property tax increase in November 2023.

The vote to approve this measure passed 8-7.

The motion calls for administration to keep the 2025 property tax increase to a combined 3.6 per cent (5.5 per cent for residential and 1.4 per cent for non-residential), and 3.1 per cent (5 per cent for residential and 0.9 per cent for non-residential) for 2026.

It also asks that city admin find “reasonable operating budget reductions” to either reduce property tax required or for select additional investments in priority areas.

Coun. Spencer said that last week he was ready to pat himself on the back for helping stem the tide of road degradation with investments they’d made in prior years. He said even with those investments the city is barely moving the needle “out of the orange” of those roads needing work.

“This city has financial pressures. So, this exercise is good. We need to do it, but we need to do it with the right process,” he said.

“Let’s stop playing politics. Let’s do the hard work.”

Ward 3 Coun. Jasmine Mian said that she’d heard some dissatisfaction from her fellow members of council that the prior budget process didn’t bring the public along, there was no expense ceiling given to administration, and they wanted to see more focus on efficiencies and savings.

“This delivers on all three,” she said.

“I ask you colleagues that you consider supporting it purely on the basis of the spirit in which we began trying to budget differently at the city, and the attempt that this is to actually move along that process and address concerns that I’ve heard directly from you.”

Happiness and disappointment: Coun. Sonya Sharp          

Ward 1 Coun. Sonya Sharp said Tuesday’s recommendation was bittersweet for her. On one hand, she sees this as an inflection point where admin and her colleagues have had a change of heart about finding efficiencies that would curb a tax increase. 

“It’s a little bit late in my opinion for Calgarians who have to live with the consequences of this budget and the additional base spending. That’s new spending to what we added in the future, not just 2024.”

Sharp also said she was disappointed that this appeared to close the door on potential reductions to the 2024 budget, which is slated to cost the typical Calgary homeowner $16 each month. She alluded to it being a politically opportune time to consider this kind of motion.

“But hey, credit is due where it’s due. At least we’re having a conversation now, and right on schedule, just to head into our last budget before the next municipal election. So, I think it’s pretty cynical politics to raise taxes and then only start looking for cuts and then hoping it’s the last thing that people remember before they go vote.”

Other councillors, like Ward 11’s Kourtney Penner and Ward 9 Coun. Gian-Carlo Carra weren’t in favour of the motion, simply because it doesn’t necessarily meet population and inflation needs, and locks the City of Calgary into a level before the city’s needs are known.

“I did not vote to daylight direction right now because I think we have yet to get all the way through our work and I think this handcuffs us,” Coun. Carra said.  

“I also think that anything that touches up against growth plus inflation and is probably going to be below it is not meeting the needs of the city that we have right now.”

Differing thoughts on whether the cap would stay

Coun. Sharp said that she sees this just as a recommendation for administration and not necessarily a hard spending cap.

“There could be a whole laundry list coming forward in November. So this is I don’t see a cap here. I see just a direction – don’t go above this and work within this budget, but Council can do whatever it wants.” she said.

Mayor Jyoti Gondek said that this was an opportunity to look at different city services and find potential efficiencies.

“The point is that if we can find efficiencies where we’re spending less money to deliver services, that’s what we need to be looking at,” she said.

The mayor felt this was clear direction that city administration – and councillors – would work within the budget they’d agreed upon in 2022.

“We’ve given them clarity, and the goal is to hold to what we agreed to in the four-year planning process,” she said.

After the meeting, Coun. Spencer said he believes some services will have to be cut to meet just the proposed increase for each of those years. He said he considers this direction a hard cap on any additional spending.

“I can’t speak for everyone around the horseshoe but certainly, the way I’m approaching it is we have to make some hard decisions on the other side of the ledger to make sure that we drive efficiency and and deal with some of the reputational issues that this council now has lingering over it,” Spencer said.

“But when it comes right down to it, like those reputational issues…we made good decisions about where the city was at and where the city needed to go. And unfortunately, that requires all Calgarians to be invested in the future of the city.”