Edmonton residents can expect about a 3.1 per cent tax increase in 2017, which the city said works out to be about $72 more per year for the average household.
When the city announced the three-year operating budget last year, the estimated tax increase for 2017 was projected at about 3.4 per cent. The lower number was revealed Friday afternoon as the City of Edmonton released its proposed 2016-2018 Supplemental Operating Budget Adjustment.
About 1.5 per cent of the tax increase for next year will go towards neighbourhood renewal to repair roads, sidewalks and street lights in Edmonton’s more than 300 aging neighbourhoods.
The city worked to find $22 million to help fund the neighbourhood renewal program, which officials initially expected would come from government grants.
“We’ve delivered a proposed budget adjustment that provides good value, balances the budget and allows us to prioritize and fund an important initiative, the Neighbourhood Renewal Program, within the tax levy amount that council had previously approved for 2017,” Todd Burge, the city’s chief financial officer, said in a media release.
The city said savings were found in a number of areas. Reduced fuel and utility costs and contract negotiations accounted for $6.2 million in savings. Another $34.1 million in savings came from scrutinizing city programs to reduce spending. In addition, 46 vacant full-time positions were eliminated.
Burge said efforts were made to keep the tax increase low, given the current state of the economy.
“We feel that pressure. We want to make sure that we’re going to provide good value to citizens. So we worked really hard this year to try and keep that number within 3.1 per cent,” he said.
“What we’re trying to do is actually hold the line until things actually settle and then moving forward we’ll deal with it,” Burge said. “We’re trying really hard manage our expectations down to the economy.”
READ MORE: Edmonton council passes three-year operating budget
Additional costs of $4.2 million were absorbed in the 2017 budget adjustment: $3.5 million for climate change and $700,000 for the increase in minimum wage.
“We’ve actually made some adjustments on our utility side and other expenditure adjustments to make sure that we can accommodate the expected cost of climate change within our budget,” Burge said.
The 3.1 per cent tax increase breaks down as follows:
- 1.5 per cent for the Neighbourhood Renewal program
- 1 per cent for base budget to maintain programs and services
- 0.6 per cent for the Valley Line LRT
The 2017 Supplemental Operating Budget Adjustment will be presented at the Nov. 29 council meeting. A public hearing for people to provide input will be held on Dec. 8. The entire proposed 2016-2018 Supplemental Operating Budget Adjustment document can be viewed on the City of Edmonton’s website.
In 2016, municipal property taxes accounted for 56 per cent of the city’s overall operating budget. The money pays for services such as police, fire, road maintenance, transit, recreation facilities, parks and neighbourhood renewal. About 60 per cent of the budget go towards personnel costs.
In total, the city collected nearly $1.9 billion in property taxes – $1.4 billion in municipal taxes and $454 million in provincial education taxes – in 2016.
The surplus for 2016 is expected to be about $20 to $25 million, but that number could change depending how snow removal plays out for the rest of the year.
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