In a vote of five to two council gave the first three readings to its proposed property tax bylaw at the Tuesday evening council meeting, which includes a three per cent tax increase for 2012, with a one per cent tax shift away from major industry to business and residential.
As a result, that three per cent would not be a three per cent increase across all classes, but would translate into a 4.87 per cent increase in residential taxes — or $5.50 for every $1,000 of assessed value in 2012, up from $5.26 in 2011.
In other words, a home assessed at $200,000 will see a $48 annual increase.
An increase to the business rate of 5.17 per cent equates to $11.88 on $1,000 assessed value in 2012, up from $11.20 in 2011; and an increase to light industry of 5.82 per cent equates to $43.39 on $1,000 assessed value in 2012, up from $34.71 in 2011.
Major industrial taxes will see less of an increase, going from $88.24 to $89.37 on $1,000 of assessed value, whereas utility rates will remain capped at $40 per $1,000 assessed value.
It came as no surprise that councillors Ivan Bonnell and Surinderpal Rathor voted against the tax bylaw, as that has been their position throughout the budget discussions.
Bonnell described the break to major industry as a “break through the back door” and an “injustice to residential and business sectors.”
“If major industry thinks it has a challenge this year with what’s going on economically in their sector, future years aren’t looking much brighter,” Bonnell said. “The position council’s taking on this tax is unsustainable and will compound into an even bigger problem next year.”
He also said he was disappointed that work on South Lakeside has been postponed to 2013.
Mayor Kerry Cook agreed she was not pleased that the work has been delayed, but said the city ran out of time and that the necessary details and design work were not in place.
“What was also brought up was that we did not want to inconvenience people who drive that road for over two years.
“That was my final decision,” Cook explained, adding she understands the frustration.
More than $1.7 million in cuts were made to the budget, Cook said.
When it comes to the tax rate, Cook said she disagreed that it was a break to one sector.
“They’ve been paying their share for many, many years. What we have to do as a council is look at the long term.
Coun. Geoff Bourdon agreed and said in 10 or 15 years he believes he will be able to look back and say he made the right decision.
“Often the decision that’s right for the long term is not popular for today,” Bourdon said.
Rathor said he was saddened that a zero per cent option was never proposed.
“I feel strongly that we did not cut back enough,” he said.
Although disappointed in the delay of South Lakeside, Rathor agreed with Cook that he’d rather see the road work done right over one season, rather than over two years.
On the other hand, Coun. Sue Zacharias described the tax bylaw as being financially responsible.
“The citizens don’t want to see a cut to the services. We did cut and slash 1.7 million and we’re still keeping the services that our citizens value.
“I do believe we have to keep putting money aside for different areas of the community,” she said, adding the savings will help when it comes to applying for grants because the city will have money to put in the pot.
Echoing Zacharias, Coun. Laurie Walters said she’s supported the idea of saving for the future and believes the budget is one of the steps the city is making toward that goal.
“I’ve spoken to people who are putting it into perspective, the actual increase that we are asking for, and how much it equates to at the end of the day,” Walters said.
Walters said the budget process has been difficult, but that she’s learned a lot.
“Maybe sometimes you have to go through this to learn how to do things differently. Maybe this budget isn’t as sexy or the budget of process, but we have to recognize that what we’re doing is building toward bringing down our debt.
“We are being thoughtful on how we are going to plan ahead by having reserves in place,” Walters said.