Calgary city council votes 8-7 to increase residential taxes by 3.45%

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WATCH: City council voted to increase 2019 residential taxes by 3.45 per cent on Monday in Calgary. Michael King has more – Apr 9, 2019

After postponed and marathon meetings, Calgary city council finally decided to increase 2019 property taxes for homeowners and lower them for businesses on Monday.

By a vote of 8 to 7, council approved a 3.45 per cent residential tax increase for this year, which means an extra $105 for a home valued at $475,000.

Non-residential properties will see a municipal tax rate decrease of 1.77 per cent — that’s part of a combined decrease of 3.07 per cent.

For total property tax revenue, the percentage split between residential and non-residential property owners is now 47-53. Compare that to the previous split of 45 per cent residential and 55 per cent non-residential.

READ MORE: Calgary city council takes another week before finalizing 2019 tax rates

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At one point, council voted down both options on the table before approving one.

Mayor Naheed Nenshi called the approved selection a “more measured approach.”

“It gets us to that 50-50 ratio over a little bit of time rather than doing it right away,” he said.

“The other option we had was: do it right away and then rebate people this year but they’ll have to pay the increased tax next year or the year after.”

Instead of a residential rebate program, council’s choice includes a small business sustainment grant that would help non-residential property owners with tax increases over the next two years, financed by $70.9 million from a reserve fund.

Nenshi said businesses that have seen their costs increase over time will be eligible to apply.

“We’ll be able to give them some cash in their pocket so that they can continue,” he said.

READ MORE: ‘Unprecedented situation’ at city council could see $500 a year increase on average Calgary home

Ward 3 Coun. Jyoti Gondek said the grant program doubles down on businesses at the expense of homeowners. While she was disappointed with Monday’s outcome, she said she understood the perspective of her coworkers.

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“I can understand why the appetite wasn’t there to do the structural change. Change is tough especially change this massive,” she said.

“I am impressed with my council colleagues for thinking differently and for thinking of new ways to make sure we protect not only our business community but also our homeowners. What we proposed in both scenarios was not perfect.”

WATCH: After hours of debate on Monday, city council has approved a tax hike for Calgary homeowners. Carolyn Kury de Castillo reports.

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Calgary City Council approves residential tax rate hike – Apr 8, 2019

Ward 11 Coun. Jeromy Farkas said the focus of the conversation should have been how to reduce the tax burden instead of where to toss it like a “hot potato.”

“There’s just no ground to stand on for council to go back to residents and say that they have to pick up the tab for, really, what is overspending at city hall,” he said.

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The Calgary Chamber of Commerce said council’s decision was troubling because it failed to provide certainty.

“The decision today does not go far enough in addressing the structural changes needed to fix the inequity problem for the long term,” a news release said.

“We are also concerned about the uncertainty for immediate relief needed this year for businesses experiencing sharply inflated tax bills due to the downtown tax shift.”

READ MORE: Calgary’s downtown vacancy rate predicted to stay in 20% range into next decade

The tax rate had to be finalized Monday ahead of notices being mailed at the end of May.

Taxes are due June 28, the city said.

– With files from Global News’ Carolyn Kury de Castillo

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