City of Powell River property taxes expected to increase in 2017

Finance committee to recommend staff find further cost savings

Homeowners in Powell River should expect higher property taxes this spring, but the question of how much higher is still open for debate, says City of Powell River councillor and finance committee chair Russell Brewer.

Council’s finance committee met Thursday, February 9, to discuss recent work on the 2017 operating budget for city departments.

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City chief financial officer Kathleen Day presented the committee with an update.

Day told the committee that developing the 2017 budget has been challenging due to operating increases of roughly $950,000 in 2016 that were not covered with equivalent property tax increases. Costs included hiring additional emergency services personnel, a contract settlement for firefighters and additional operating expenses related to the new library building, among others.

“It has been a difficult budget process this year, especially for the department heads,” Day told the committee.

On top of those expenses, the cost of staffing the city’s police, fire and operations will increase a further $1 million in 2017. Powell River has an operating budget of approximately $22 million.

The city will pay an additional $600,000 to honour its two per cent wage and job evaluation parity increases in 2017, elements of Canadian Union of Public Employees Local 798’s last negotiated collective agreement.

Policing will cost an additional $111,000 and the city will spend a further $216,000 to cover retroactive RCMP pay. Powell River Fire Rescue will receive $110,000 more and the city’s administration will see an added $55,000.

Day said staff has been looking at places to make further cuts and some of those increases will be offset by the city bringing in more revenue than expected, but residents should expect a higher tax bill than last year.

The city brought in $277,000 in new property tax revenue from construction, $126,000 in new municipal leases and approximately $300,000 in development applications and building permit reviews.

Brewer said the committee is currently looking at about a 2.9 per cent property tax increase.

“The big reason we’re sitting at the 2.9 per cent, with not much room for anything else right now, is our collective agreements with firefighters, police, CUPE and a little bit on the management side,” said Brewer after the meeting. “This makes balancing the budget difficult. Staff has been digging to cut where it can.”

Staff has been able to trim $285,000 out of individual department budgets, Day told the committee.

Of that 2.9 per cent potential tax hike, 2.4 per cent will go toward covering operational increases and the other 0.5 per cent for water, sewer and garbage. At the last finance meeting, the committee looked at two per cent user-fee increases for garbage ($29), water ($6.15), sewer ($2.35) and average sewer frontage parcel taxes ($6.75).

Based on the city’s current tax base, a 2.4 per cent increase would bring in approximately $335,000 in added tax revenue.

A 2.9 per cent increase for an average single family home, assessed at $236,237, would mean that homeowner would pay $2,565.43 in general municipal property taxes and user fees in 2017, about a $75 increase over 2016 rates. That does not include taxes the city collects for Powell River Regional District and School District 47.

Work developing next year’s city budget is far from complete, so that proposed increase will likely not be what taxpayers actually see, said Brewer.

The finance committee will meet again on Thursday, February 23, to review and discuss proposed department capital project budgets. Depending on the outcome of that meeting, the budget will be further calibrated.

“This budget with a 2.9 per cent increase is pretty much maintaining service levels with a few cuts, no improvements and no increases to services,” said Brewer. “It’s basically a core budget. There are still cuts to be made.”

Brewer said he favours the idea of the committee directing staff to find ways to reduce the increase to 1.9 per cent, so it is in line with Statistics Canada’s consumer price index.

Copyright © 2017 Powell River Peak


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