Calgary city council rejects tax cut proposal

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Calgary city council to debate property tax rebate next week
Six Calgary city councillors are calling for a reconsideration of the budget approved in November, in an effort to claw back the 7.8% property tax increase. Adam MacVicar reports. – Jan 23, 2024

Calgary city council defeated a motion Tuesday to re-open the city’s proposed 2024 budget to find more than $23 million in tax rebates to cut property tax increases.

The original motion directed city administration to find $23 million in savings to offset the cost of a one-per cent shift in the tax share from businesses to residents, and in turn, provide some relief from this year’s property tax bills.

Councillors Terry Wong, Sonya Sharp, Dan McLean, Andre Chabot, Jennifer Wyness and Sean Chu co-signed the motion, which was first presented in an executive committee meeting on Jan. 23.

The tax shift, as well as a package of 28 spending items in November’s budget, contributed to an overall property tax increase of 7.8 per cent for Calgary homeowners this year.

At Tuesday’s council meeting, Coun. Sharp amended the motion to direct city administration to recommend one-time operating and capital budget adjustments to reduce the 2024 budget by $23 million.

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Wong and Sharp said they’ve heard from constituents that the property tax increase is too burdensome during a cost of living crisis.

“Most people’s finances are strained right now. An eight per cent increase is extremely tone deaf,” Sharp said.

“This also means next year’s tax increase will be 5.5 (per cent).”

Sharp later added council and administration need to be more flexible with the budget.

“We have room for $23 million. If we cannot find $23 million in a $5 billion budget, we may be doing something wrong,” Sharp said.

Coun. Walcott vocally disagreed with the motion, saying renters and vulnerable Calgarians would not benefit from the tax rebate if it was approved.

“The reality that we are facing is very straightforward … Do we believe that the spending on mental health, spending on affordable housing and spending on transit safety is something we want to cut?” he asked in council chambers.

Walcott added re-opening the budget to find cuts across the board will also cut important services.

“Let people watch,” he said. “We are talking about what we are hearing from residents. I can’t go back to my residents and tell them we’re putting their mental health at risk.”

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The motion as amended was defeated 7-8. Mayor Jyoti Gondek and councillors Courtney Walcott, Evan Spencer, Raj Dhaliwal, Richard Pootmans, Gian-Carlo Carra and Jasmine Mian all voted against the motion.

The motion previously required a 10 vote majority to pass, as it would’ve required a reconsideration of the budget’s approval; but Sharp amended it to remove the reconsideration.

This comes after council deliberated its 2024 operating budget in November, which could see a property tax increase of 5.7 per cent but could rise as high as eight per cent for homeowners.

The increases to property taxes remain in line with administration’s recommendations to increase spending to meet the demands of a growing city. On Tuesday, Gondek said 60 people are moving to Calgary a day.

In November, city administration recommended a proposal to shift the tax share between businesses and homeowners by one per cent annually over the next year.

Currently, residential properties cover 52 per cent of property taxes in Calgary, with businesses paying the remaining 48 per cent.

Instead, city council will shift its focus to the 2025 budget later this year.

A motion from Gondek, which was approved by council, aims to begin discussions around the 2025 budget as soon as next month; discussions that are expected to include finding potential “service efficiencies.”

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“I don’t accept the argument that we’re just going to cut from the investments we’ve made because that’s the easiest place to go,” Gondek told council. “I think we need to look at the service lines that were perhaps not examined in depth last time.”

Sharp told reporters following the meeting she felt Gondek’s motion was a “political play to save face.”

–With files from Adam MacVicar, Global News.

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