Saskatoon is facing a $52.4-million funding gap next year, with a $23.2-million funding gap in 2025.
That’s according to the city’s chief financial officer Clae Hack, who said that would equate to an 18.56 per cent property tax increase in 2024, and a 6.95 per cent property tax increase the following year.
A budget status update report will be considered by the city on June 14, with special budget meetings planned throughout June, July and August to work on addressing these issues.
The report said there is no longer an expectation of returning to pre-pandemic revenue levels by 2024.
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Hack said budget pressures are consistent with what was presented in March, noting there were five areas that were causing this pressure.
“These included ongoing financial recovery from the pandemic, base budget challenges, significant inflationary impacts, funding for the emergency 2022 snow and ice response, and Recovery Park operating funding,” Hack said.
The report said the city is facing inflationary pressure in the maintenance done around the city, payroll costs, the Saskatoon Police Service and transit services.
It added that growth and investment in other areas are contributing to these pressures as well.
Hack said there is an $8.2-million gap left over that needs to be addressed due to there no longer being one-time funding in 2024 to offset losses in revenue due to the pandemic.
He said the black cart program will be moving from a property tax to a utility in 2024, reducing the operating budget by $7.4 million.
It was noted that this will lower potential property tax increases, but will come with its own utility fee.
Hack said that the downtown entertainment and event district plans don’t contribute to the funding gap, noting there was nothing in the budget allocated to it.
“The city is still working towards a funding plan with the goal of having no reliance on the property tax.”
Hack said the funding gaps they are facing are roughly double the size they have faced in previous years.
“We’ve certainly been having these conversations with city council over the past year. The conversation has changed. Inflation is not something that we were maybe considering was going to be significant 12 months or 18 months ago.”
He said it was hard to have an apples-to-apples comparison between different cities in the country, but said city officials have seen several examples of cities running into higher-than-normal costs.
“Nobody’s happy presenting these numbers.”
Hack said everything is on the table for these discussions.
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