Future Edmonton property tax hike one option to plug $93M Blatchford shortfall

Artist renderings of what the Blatchford site could look like once phase one is complete. Courtesy, City of Edmonton

The City of Edmonton’s administration has opened the door to introducing a property tax increase to help pay for bringing in a more expensive, greener utility for Blatchford.

The funds would cover off an anticipated $93-million investment from the federal government that hasn’t come through yet. The $93 million would be borrowed under this new option, using the property tax hike to pay back the loan.

The chair of council’s Utilities Committee, Councillor Ben Henderson, said the tax hike is an unlikely scenario, especially when there are several green funds from Ottawa that haven’t been tapped into yet.

“I’d be very careful to suggest that we’re even about to talk about or consider a 0.4 per cent increase for Blatchford,” he told reporters after the meeting Friday.

“Administration is responsible for bringing us all of the options. That’s what they did today. But that’s a long way from recommending that that’s the route we should be going or that’s the only route we can go.”

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“We’re certainly not there yet,” deputy city manager Adam Laughlin told the meeting.

“We’re presenting options for council’s consideration. This is one of the suite of options amongst others.”

READ MORE: It’s official: NAIT will expand campus on Blatchford lands

Other options to pay off the debt include revenue from land sales at Blatchford, higher utility rates, or partnerships with other utility providers, if the federal and provincial grants don’t come through.

Henderson is still confident Edmonton will eventually see the money from Ottawa, and won’t need to go into additional debt.

“If you see it, it’ll be many years in the future and I think there’s a whole bunch of other solutions.

“To be fair to administration they were bringing us all of the options and that was one of them.”

READ MORE: Some Edmonton city councillors questioning why Blatchford needs more money

WATCH BELOW (Oct. 25, 2018): Questions are being raised as the costs add up to make the Blatchford community a green one. Millions have been spent so far and the city is being asked to spend much more. Vinesh Pratap reports. 

Click to play video 'Costs to make Blatchford green start to add up' Costs to make Blatchford green start to add up
Costs to make Blatchford green start to add up – Oct 25, 2018

Still, it caused concern.

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“When you tell people a 0.4 per cent increase in taxes because of all of this — I mean, we’re not going to sit down and explain each and every number — it’s pretty hard to digest for those folks,” Councillor Moe Banga said.

“I do have a question about the equity of everyone in the city paying for a utility that is going to be used by one community in the city in order to keep their specific rates down,” Councillor Aaron Paquette added.

He asked questions about how viable it will be in the early going to add 3,000 housing units on Blatchford when there are so many new apartment buildings planned for downtown and Old Strathcona.

We’ve got a housing space glut and that’s going to be exacerbated by all the new apartments we’ve got going up.”

READ MORE: Rates are up, prices down. How tough is the mortgage stress test across Canada today?

He also worries about federal changes to mortgage qualifications.

“It’s in flux. We don’t know.”

Council will eventually vote on $660 million of infrastructure to be built at Blatchford over the next 50 years. Most of the money will be repaid through ongoing customer utility rates.

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Council had previously instructed city staff to come up with a program that would see customers pay a comparable fee to what they would elsewhere in the city through their energy utility bills and annual maintenance costs.