Calgary city council will dip into millions in reserve money to increase spending on a variety of projects while keeping the proposed property tax increase capped at 3.6 per cent.
Council officially began debating the budget on the fourth day of talks, with councillors bringing forward 38 amendments and motions aimed at tweaking next year’s financial plan.
Several of those proposed changes aimed at using $38 million in surplus money set to be allocated to the Fiscal Stability Reserve (FSR), the city’s equivalent of a rainy day fund. Several others propose spending reductions aimed at whittling down the projected tax increase.
Councillors approved using $9.5 million of that money set to go to the FSR to help fund a new firearms training facility for the Calgary Police Service instead of allowing police to use funds earmarked for the Community Safety Investment Framework.
Another $15 million will be tapped over two years to pay for unfunded maintenance and repairs at city-owned recreation facilities, including the Village Square Leisure Centre.
“We need to make sure our reserves stay at acceptable levels, but we also need to get money out the door into our priorities,” said Ward 3 Coun. Jasmine Mian, who brought forward the amendment on recreation facilities. “Hoarding money in FSR is also not the responsible thing we do, we get criticized for that too so I think as long as we’re spending it on things that Calgarians value, it’s important.”
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Council also voted to use $20 million from a different reserve fund, the Future Capital Reserve, to further boost the budget for road repairs and pavement quality.
Although the approved spending won’t have an impact on property taxes, some councillors raised concerns about the potential implications of using reserve money as one-time funding.
Ward 1 Coun. Sonya Sharp called the move “short-sighted,” and noted potential impacts on next year’s budget deliberations.
“I’ll tell you why I’m worried: the more we’re using this FSR, the less money we’re going to have for the next council,” Sharp told reporters. “Our job as governors is to ensure the public purse has the rainy day fund; we’re draining it really fast.”
Calgary’s mayor defended the use of reserve money as a way to move forward on critical projects without hiking property taxes further.
“We could either increase taxes by increasing the budget for things that are needed like pavement quality, infrastructure, recreation facilities, but we knew we couldn’t do that this year,” Jyoti Gondek said. “We had to stay true to what we said in 2022, that the budget wouldn’t increase beyond 3.6 per cent. Calgarians can’t afford it.”
However, the afternoon session of budget talks saw several attempts by five city councillors to cut the tax increase by reducing spending met with opposition by the majority of city council.
Those proposals included cutting expense and office budgets for city senior leadership and abandoning the city’s strategy to purchase electric buses.
Another defeated proposal was to reduce this year’s plan tax shift from non-residential properties to residential by 0.5 per cent.
The move would’ve only saved $12 per year for the typical residential homeowner, but cost $1,068 extra per year, or an additional $89 per month, for the typical non-residential property assessed at $5.59 million.
“Every time we’re looking for savings, it’s getting shut down,” Ward 13 Coun. Dan McLean said. “They call this the ‘hold the line budget’ but in reality it’s $600 million in increased spending.”
Late Thurday, city council voted in favour of using an additional $400,000 from the FSR to halt the closure of the Inglewood Pool until 2026; however, the move still requires a reconsideration vote by council to keep the doors open.
City council will continue deliberations on Friday afternoon.
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