Calgary city councillors to juggle affordability as budget debate continues

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Calgary councillors to juggle affordability as budget debate continues
WATCH ABOVE: After hearing from Calgarians, city council is moving into its next phase of budget deliberations. As Adam MacVicar reports, some councillors feel more should be done to address affordability – Nov 23, 2022

Calgary city councillors will begin debating amendments to the proposed four-year budget, with some councillors indicating they’ll be looking to changes to address affordability.

That indication comes after a lengthy public hearing that saw 128 Calgarians line up to give their feedback on the 2023-2026 budget; 153 in total, including the speakers from civic partner organizations on Monday.

Although there weren’t many citizens who were critical of the proposed property tax increase next year, some brought forward concerns about inflation and rising costs.

“I feel we can do better,” Andrew Kaiser told Global News after speaking to council. “Maybe for every dollar spent, council should be forced to find a dollar in savings.”

The proposed budget calls for an overall property tax increase of 4.4 per cent in 2023; followed by an average tax increase of 3.7 per cent the remaining years of the budget.

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City officials said next year’s increase equates to $10 per month more for the average homeowner in Calgary.

“Affordability is more than not being able to afford $10 per month, it’s also the compounding effect of every other cost to a homeowner and citizen,” Ward 1 councillor Sonya Sharp said.

According to budget documents, household spending in Calgary is forecast to increase by 7.1 per cent this year amid inflationary pressures.

“It’s very unevenly felt. The prices at the gasoline pump and in the grocery stores, in particular, are up significantly more than that,” said Brian Trafford, chief investment officer at CH Financial Ltd.

“We’re hearing stories of 10 to 15 per cent. These are very large numbers, and if they keep going like this, that’s obviously going to become a major, major concern.”

In response, city council asked administration to build the budget with a limit to keep spending below the rate of inflation and population growth.

However, municipalities across the province are also feeling the pressure of inflation and are also proposing increases to property taxes in their upcoming budgets.

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Proposed property tax increases in municipalities across Alberta, according to preliminary budget documents. Global News

Cathy Heron, the mayor of St. Albert and the president of Alberta Municipalities, called the situation “a perfect storm” of inflation, ongoing impacts to revenues from the COVID-19 pandemic, and the downloading of costs from the province.

Heron added that years of tax increases that fell below the cost of living have also caught up with many Alberta cities.

“This is provincewide, and it’s probably nationally an issue,” Heron told Global News. “This is not an issue that is a result of mismanagement of funds or inefficiencies.”

Sharp told reporters during a break in Wednesday’s council meeting that she is exploring the use of reserves to offset the proposed increase to property taxes.

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“Reserves have parameters around them and rules, and terms of references, so I’m asking questions. What can we use the money for?” Sharp said. “One of the speakers this morning talked about the amount of money coming from the planning and development reserve.

“I’m asking questions like, ‘What else can we do with the rest of the $97 million that’s in there?'”

Meanwhile, Mayor Jyoti Gondek said she heard during the public hearing that transit is “an overwhelming concern and an issue” for Calgarians.

Transit fares, including low-income passes, are set to see increases in the proposed budget. But Gondek said there are some councillors looking into holding those rates at current levels.

On Tuesday night, Premier Danielle Smith announced several financial relief measures she would be bringing in for Albertans during a television address, including investments in low-income transit passes.

“I don’t know how quickly the premier is going to be able to tell us what she’s willing to do — what her government is willing to do — on low-income transit passes,” Gondek said. “There’s still a major burden of responsibility on this council to act.

“Myself and many of my colleagues are interested in freezing rates at the very least.”

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Budget deliberations continue on Thursday with councillors putting forward their amendments before finalizing the four-year plan later this week.

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