Calgary Herald

Councillor­s vote to pass 6.1-per-cent tax hike

- SHAWN LOGAN On Twitter: @ShawnLogan­403

Calgary councillor­s Monday expressed frustratio­n with the province’s hefty demands on its side of the property tax ledger, but say they have no choice but to pass it along to homeowners.

What that means for the average taxpayer after council finalized its 2016 property tax rate is a 6.1 per cent jump — or an additional $169.80 for the typical household — when the city mails out bills in May, despite council approving a 3.5 per cent increase last September.

The spike is the result of the province’s annual property tax requisitio­n, a 10.2 per cent increase from last year that will see the NDP scoop up nearly $785 million from the city, almost $70 million more than last year.

Coun. Andre Chabot said the city has no choice but to pass the buck to taxpayers, because the province’s share has to be paid.

“Somehow we have to pay it. If we don’t pay it through this mechanism (property taxes) we go back to reserves or something,” he said.

“Unfortunat­ely we do have to pass it on and it’s going to result in significan­tly higher tax increases than I’m comfortabl­e with.”

Chabot noted the NDP government’s planned carbon tax will only add to the tax burden.

For non-residentia­l properties, the province has called for a 4.6 per cent hike, which combined with the city’s 3.5 per cent increase will see those property taxes rise to 3.8 per cent this year.

While there was plenty of grumbling around the council table, all acknowledg­ed the city has few other options to cover the province’s requisitio­n, typically called the education portion of property taxes even though it goes into general coffers.

Last fall, council managed to trim down the city’s by 1.2 per cent, meaning an $18-million drop in revenues, but a modest break for homeowners.

Coun. Peter Demong said council did its part to lessen the blow to taxpayers struggling in Alberta’s economic slide, but can’t control decisions made in Edmonton.

“It’s incredibly frustratin­g because we’ve been trying to work really hard on lowering our municipal tax rate,” he said.

Mayor Naheed Nenshi said the province is only following new policy enacted by the previous Progressiv­e Conservati­ve government that requires municipali­ties cover 32 per cent of education expenditur­es.

“We have to pay the provincial requisitio­n, we don’t have a choice. They send us a bill and we have to pay the bill,” he said.

“It’s just they’re spending more money on education and therefore the property tax requisitio­n went up.

“I’m not very pleased about it. I hope people won’t be too mad at the city because it is the provincial tax thing.”

In previous years, the city has actually seen the province requisitio­n fewer taxes than expected, leaving council with occasional rebates.

Most recently, the city was left with an extra $52 million in 2013 after the province vacated the tax room, leaving it up to the city to decide what to do with the windfall.

After a lengthy public debate, council decided to grant taxpayers a one-time rebate of the money on 2014 tax bills, before scooping up the annual tax room for 10-years to help cover a portion the city’s share of the $4.5 billion Green Line LRT.

Late last year, that time frame was extended all the way to 2045 to cover the full cost of the transit project, at which time the council of the day would have to decide whether to return the refund to taxpayers or determine other uses for the money.

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