Calgary is predicting a bump to its current surplus, on the back of higher investment income, lower expenditures, and overall salary savings to close the fiscal year.

Last week, during his State of the City address to the Calgary Rotary Club, Mayor Jeromy Farkas mentioned that there was a $110 million surplus up to the end of June. It was included in the City of Calgary’s quarterly report.

According to the city, there is a year-to-date “favourable operating variance”, consisting of $73 million across city departments and $37 million within corporate programs.

“This reflects The City’s financial performance through the first six months of the year and is not the final year-end result,” read an email response to questions from LWC. 

“Financial performance will continue to be monitored throughout the remainder of 2026, and the variance may change as revenues are received and planned expenditures and reserve-funded activities occur.”

They said that the surplus was driven by a combination of stronger revenues, particularly from permits, user fees and investments, plus lower expenditures and some salary savings.

“The City is forecasting a favourable year-end operating variance of approximately $130 million, reflecting higher investment income, lower assessment losses, corporate provisions that are not yet required, lower expenditures and salary savings,” they said.

Calgary’s fiscal year runs from Jan. 1 to Dec. 31, so the third quarter will be at the end of September.

While tariffs are expected to have some impact in 2026, the city said the impact in 2026 is unclear. Last week, city procurement officials said that over the course of $5.3 billion in purchasing, there could be up to a half-billion impact on overall costs.

“The estimates shared with Executive Committee on 8 September, 2026 reflect our best assessment based on current information, assuming the tariffs continue for the long-term and without any mitigation,” read the City of Calgary response.

“We will continue to monitor economic conditions and update our forecasts as needed.”

Many factors, not just property taxes, at play in surplus: Mayor Farkas

Mayor Jeromy Farkas said he believes the city surplus demonstrates prudence on the part of city administration.

“Just because we give you a certain outlay of money to spend doesn’t necessarily mean that you have to spend it,” he said during a recent recording of LWC’s member-exclusive Mayor and Me podcast.

The mayor said that he would like to help pay down debt to lower tomorrow’s expenditures but also deal with some of Calgary’s infrastructure and maintenance deficit.

When asked directly if a surplus of this nature is reflective of property tax increases being too high, Farkas said that’s the argument he made in the last city budget discussion. Many councillors in the past have said that continual surpluses are evidence that Calgary is charging taxpayers too much.

Farkas said that line of thinking is what ultimately allowed them to bring down the property tax increase to 1.2 per cent.

He noted that city council decided to immediately earmark $50 million to go straight to the operating base each year as evidence that the money is being used to limit the impact of property tax increases. 

For context, one per cent of property tax increase is equivalent to roughly $25 million in operating costs.

While Calgary grapples with a massive infrastructure deficit and a growing number of needs among the different city departments, Farkas said that this additional cash is best used for one-time expenditures. That’s primarily because it’s not necessarily a reliable source of revenue the City of Calgary can rely on annually.

Calgary has posted an operating surplus every year since 2019, including recent surpluses of $259 million (2025), a $276 million surplus (2024) and $238 million (2023).

“If future surpluses come in, it really should be things that we can’t bank on from a year-to-year basis,” he said.

“But we can say, just like any family would, maybe we throw it at an additional payment to the mortgage to be able to reduce ongoing costs.”