A document aimed at providing direction to staff on property taxation over the next five years generated fireworks from one councillor Tuesday evening.
A vote on a strategic planning and budget time line outlining priorities for the preparation of the 2012 to 2016 budget was widely supported by all councillors; however, Coun. Surinderpal Rathor took exception to the report’s final recommendation — to provide tax rate increase options between two and three per cent throughout the five-year financial plan. Council had reduced the estimate from five per cent.
Rathor, who had previously supported the five-year plan with a five per cent increase in each year, said he did that when it was just a “formality” but now it’s a more “realistic” document.
He said he would prefer to see zero per cent over five years.
“If they can cut it back to two or three per cent why can’t they cut it back to zero?” he asked.
Mayor Kerry Cook said the difficulty was that council had inherited debt from previous councils.
“How do we pay for that?” she asked. “We reduced it from five per cent down to two or three per cent. It’s not written in stone.”
A five-year financial plan is required by law by every municipality. City chief administrative officer Brian Carruthers described it as a “planning document” that encourages council to look into the future and project what the financial picture will look like.
“It’s not binding to any council,” he said, adding that it’s based on estimates.
“There’s no way you could commit beyond one year so absolutely it’s not binding. It is simply a guidance document.”
Carruthers added in recent years the City’s five-year plan has included an estimated five-per-cent property tax increase over the term of five years. In reality councils have implemented a two to three per cent increase. That’s why the revised rate is more “realistic,” Carruthers said.