On Day 4 of budget deliberations, Edmonton city council passed a spending plan that will see property taxes increase by 6.1 per cent in 2025.
City councillors began the week by trying to reduce the 8.1-per cent property tax increase for next year that had been proposed to council by city administrators earlier this fall.
“The plan that I put together in collaboration with my council colleagues that has been approved by council allows us to lower the property taxes by two per cent to deal with the affordability challenges that we are facing, at the same time help us build up the rainy day fund to the minimum amount required,” Sohi told reporters on Thursday.
While the increase is lower than previous proposals, Sohi acknowledged approving the tax hike was a difficult decision.
“I don’t think anyone is comfortable with the 6.1 per cent tax levy,” he said. “We always strive to bring it down as much as we can. …
“You can always lower taxes but at what cost to services?”
Councillors Tim Cartmell, Sarah Hamilton, Karen Principe and Jennifer Rice opposed the budget.
“The annual tax increase will affect individual property owners differently, depending on how their property’s assessed value compares to the market,” the city said in a news release. “An average Edmonton household would pay about $813 in property taxes for every $100,000 of their assessed home value in 2025.
“This is an increase of $47 more than in 2024.”
In a news release issued on Oct. 31, deputy city manager Stacey Padbury noted that administrators have planned for issues that will create challenges in crafting a budget, but noted “they’re much bigger than forecasted when we developed the four-year budget in 2022.”
“We are delivering services beyond what the current budget can support and that’s not sustainable. Like many Edmontonians who continue to deal with high costs, we have to make some tough choices about what money we have coming in and what we’re spending it on.”
City administrators have noted that Edmonton’s quickly-growing population, coupled with inflation, has made it increasingly expensive to provide the services that the city currently does.
The budget adjustments approved by city council include revenue increases and spending reductions.
In order to keep the property tax increase from being even higher, city council approved several budget adjustments:
- finding $8.5 million in savings in contracts, materials and equipment
- slowing down the Heritage Program
- using an increase in the Epcor dividend and an increase in franchise fee revenue to lower the tax levy
- using the city’s LRT reserve to offset a projected transit revenue shortfall for 2025 and 2026
- reducing the annual transfer from the operating budget to fund capital projects
While city council approved reducing the annual transfer from the operating budget to fund capital projects, city administrators will put together a strategy for restoring those funds in the long term and present that plan to city council in 2025.
City council also approved increasing funding for turf maintenance, horticulture maintenance, and tree pruning.
A number of capital adjustments were also approved which resulted in a $234-million addition to the capital budget:
- $105 million in tax-supported debt for the Yellowhead Trail Freeway Conversion Program
- $87 million in “new profiles” from the Neighbourhood Renewal Reserve fund
- $41 million in increased provincial funding for Terwillegar Drive Expressway upgrades
“The decisions that city council made will allow us to maintain the roads, bridges, pathways and transit that move people; deliver the emergency services and social supports people count on, and activate attractions, recreation centres, sports fields and parks that make Edmonton a great place to call home,” city manager Eddie Robar said.
The city said the spring operating budget adjustment will happen in April and the next capital budget adjustment will happen in June.
“Council also approved an update to this process during the fall budget adjustment,” city officials said.
“Moving forward, the spring operating budget adjustment will be focused on finalizing the tax levy increase approved in the fall, unless there are unforeseen circumstances.”
Edmonton property owners will learn about their assessments in January and receive their tax notices in May.