City proposes 10% hike in property taxes

Hey there, time traveller!
This article was published 13/01/2024 (977 days ago), so information in it may no longer be current.

Even though Brandon’s draft 2024 budget calls for an 11 per cent increase in property tax revenues this year, city staff told the Sun on Friday that the actual tax increases seen by residents will be lower.

A four-year projection included in those documents show tax revenue increases of 11 per cent in 2024, 12 per cent in 2025, 10 per cent in 2026 and nine per cent in 2027.

City manager Ron Bowles and general manager of corporate services Cory Schermann told the Sun on Friday that those figures represent how much more tax revenue the city will need to take in through a combination of property tax increases, increases in the assessed values of properties in the city and new taxes created through new properties being developed and added to the tax rolls.

The city is still waiting on final property assessment figures from the province and the picture will become clearer as we get closer to budget deliberations held at the beginning of next month.

However, they said the current projection is that property tax rates will likely need to be hiked by around 10 per cent this year, with the remaining revenue coming from base property assessment increases.

When MNP delivered its 10-year financial sustainability report for the city last month, it recommended that the city increase property taxes by around 13 per cent per year from 2024 to 2027 and by around three per cent a year for the six years after that.

Even though city administration isn’t matching MNP’s figures, Schermann said that report was used in determining the draft budget.

“After the report was tabled and council had a chance to see it, admin went back and we sanitized, took a look and we tried to reprioritize and lessen the burden in each of the years based upon the prioritization of the projects that were in the capital plan,” Schermann said.

“What we’re seeing right now are those efforts by admin to try our best to lessen that burden and have the discussion with council as to what the priorities really are and if anything else can be moved.”

The actual proposed tax increases for 2025, 2026 and 2027 will likely be one or two per cent lower than the needed revenue increases, Bowles said.

When the MNP report was released, Bowles said it represented a worst-case scenario. This was backed up by discussion at the Dec. 18 Brandon City Council meeting, when councillors said the accounting firm’s report included everything on the city’s capital project wish list and the financial burden could be lessened by assessing what projects were priorities and what could be cancelled or delayed.

A 10-year capital plan published along with budget documents lists approximately $622 million in spending, of which $396 million is labelled as “essential” and $226 million labelled as “primary amenity.” No specific projects are named in the document, just categories of projects.

Schermann said a breakdown of the included projects will be presented at an upcoming pre-budget special council meeting, but many of the essential projects are replacements of infrastructure that are no longer usable or no longer meeting the city’s needs, like the southwest lift station project.

The primary amenities, he said, are projects that still need to be done but are for assets that still have some usable life left or can be delayed slightly.

Not included in that chart are secondary amenity projects, which were intentionally left out.

“There’s still stuff we want to do and there’s still stuff that is important to Brandon, but the other two categories take priority over them because we want to make sure that basic services are still there for citizens of Brandon.”

Effective Jan. 1, the provincial government paused Manitoba’s gas tax worth 14 cents per litre as an affordability measure. Schermann said that the city expects to save around $100,000 in fuel costs as a result this year.

“It helps a little bit, but it’s not going to fund a lift station or something like that,” he said.

At a pre-budget special meeting this Monday, accounting manager Troy Tripp said this year’s proposed budget shows a decrease in development cost charge revenue — fees paid by developers toward infrastructure improvements.

The reason for this, Bowles said, is that the city is being more conservative with its projected revenue from the program as previous years’ projections were too high.

The amount of revenue will likely go up when proposed increases to the charges are implemented, but Bowles said the timing and scale of those increases are up to city council.

One of the MNP report’s suggestions for the city to increase revenue was to hire a full-time grant writer dedicated to applying for funding from senior levels of government like many other municipalities have.

According to Bowles, Brandon is different because individual departments typically apply for grants with Mayor Jeff Fawcett proactively approaching the provincial and federal governments to discuss funding opportunities.

He said Brandon’s approach will be to provide the mayor with more support by hiring him a dedicated executive assistant.

The 2024 draft budget would see the city’s salary costs increase by approximately $6.7 million — 10.7 per cent. Most of those costs, Bowles said, including 15 paramedic positions, 14 police positions and four public safety communications positions are being paid for through funding provided by the province.

Before being approved, Brandon City Council will debate and amend administration’s proposed budget. Additional pre-budget informational meetings will be held on Jan. 15, 18 and 24. Budget deliberations will take place all-day on Feb. 2 and 3.

Brandon’s proposed budget documents can be found online at brandon.ca/budget/proposed-2024-budget.

» cslark@brandonsun.com

» X: @ColinSlark