Council pegs 2019 preliminary property tax hike at 4%-4.5%

New tact to help elected officials plan spending priorities for city

In a new approach to budgeting, Saskatoon city council endorsed in principle a 2019 property tax increase of between four per cent and 4.5 per cent.

That range may allow council to add spending priorities above the 3.16 per cent increase that is needed just to maintain current spending and service levels.

Council can now consider ranking a variety of spending initiatives, such as improving service in certain areas like snow clearing, or contributing to various reserve funds.

“That’s a lot of information and that’s a new approach to budgeting,” Mayor Charlie Clark said at Tuesday’s governance and priorities committee meeting.

Traditionally, the preliminary property tax increase was not revealed to council and the public until the fall. In recent years, the city administration has been releasing more information throughout the year on the property tax increase.

Setting a range and giving council time to set spending priorities is new.

A city report says a so-called “indicative rate” is part of the move toward a multi-year budget, an initiative in the planning stage at city hall.

City finance staff expect an increase in revenue from various sources of $11.21 million in 2019, but also an increase in spending of $18.6 million just to maintain services, the report says.

Slightly more than $7 million of the spending increase is linked to inflation, more than half of which is increases to wages and benefits.

Population growth and the expansion of infrastructure to accommodate it accounts for $5.45 million of the increased spending.

The range of four per cent to 4.5 per cent should allow council to add $1.94 million to $3.1 million in other spending priorities. Council will still engage in budget deliberations at the end of November, then vote on the final property tax increase.

Council is expected to offer more input on spending priorities at next month’s governance and priorities committee meeting.

The city’s chief financial officer, Kerry Tarasoff, noted the property tax range is “only a target.”

The opportunity to set spending priorities is a marked contrast to the last two years. In 2017, council was forced to reopen the city’s budget mid-year after the provincial government unexpectedly slashed grants-in-lieu of taxes to urban municipalities throughout the province.

The 2018 budget was also marked by scant new spending as the city continued to grapple with less money from the province. The restoration of provincial revenue in the April provincial budget prompted council to reduce the 2018 property tax increase from the approved 4.7 per cent to 3.79 per cent.

The city police force estimates it will request a spending increase of $4.33 million or 4.36 per cent in 2019, which would push the police budget over the $100-million mark for the first time.