Saskatoon civic administration has issued a report outlining options to address the city’s $9-million hit caused by the Saskatchewan provincial budget.
The provincial government cut the $8.3 million grant-in-lieu funding to Saskatoon in its 2017-18 budget.
READ MORE: Sask. government capping grants-in-lieu reduction at 30 per cent
Grants-in-lieu were payments made by Crown corporations like SaskEnergy and SaskPower instead of property taxes.
“City Council has two goals for how we want to respond to these cuts,” Mayor Charlie Clark said.
“We need to find a way that mitigates the impact on taxes for residents, as well as maintaining the services that provide quality of life and keep the engine of our economy going.”
One of the recommendations made by administration is increasing property taxes by 1.69 per cent which would raise an additional $3.4 million.
City manager Murray Totland said the increase would raise property taxes on a home assessed at $325,000 by $56 this year.
“A wide range of solutions has enabled us to keep any possible property-tax hike as low as we could,” Totland said.
Another recommendation is removing salary inflationary increases for employees, saving the city $3.5 million.
The report also recommends deferring snow and ice levy contributions for one year, which would save $1.12 million, and increasing the city’s return on investment for water and wastewater utilities, which would increase revenue by $1 million.
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The one-per-cent increase in the provincial sales tax and having it applied to more civic purchases is expected to add an additional $1 million in expenses in 2017, while revenue sharing was decreased by $2.1 million.
“Council will discuss these options and determine the best way forward in this difficult situation,” Clark said.
The city’s governance and priorities committee will meet on Monday to discuss the report.