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Calgary will have to make ‘tough decisions’ because of drop in revenue: city manager

Calgary city council voted in favour of reducing the mayor's salary on Monday. File Photo / Global News

The city manager said Tuesday that Calgary city council is going to have a difficult road ahead as it attempts to deal with a drop in revenue.

Jeff Fielding told the priorities and finance committee the city paid less in pension and retirement benefits in 2017 – and cut back in other areas – which resulted in savings of $14.5 million. He said that money is being used to fund this year’s tax break for Calgary homeowners.

City administration is currently dealing with a $170 million shortfall for 2018. But, a revenue shortfall is expected to create even greater challenges through 2019 to 2022.

READ MORE: No new tax powers in new city charters for Calgary, Edmonton

“Council can’t have it both ways right now” said Fielding. “You can’t ask for certain types of programs to be extended, expanded and at the same time be looking for deep tax cuts”

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The city manager said while much has been made about an improvement in the economy and Calgary’s jobless numbers, the city’s problems go way beyond that growth.

“When you have as much vacant space in the downtown, we’re going to be living with the impact of the downturn for many, many years to come; they will not bounce back on the revenue side like you might hope.”

Mayor Naheed Nenshi said that massive revenue shortfall means the new council will have to make some important decisions.

READ MORE: $2M in funding for 10 Calgary arts groups will ‘put wind under our wings’

“That will involve increased taxes or fees, or significantly cut services; really they have to make that decision,” he said, explaining that those decisions will mostly impact the 2019-2022 business cycle.

 

 

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