Be careful with our taxes
When it comes to spending money few people are as good at it as the municipal government.
Next year the municipality is poised to increase municipal taxes by 3.01 per cent.
If the budget is approved, municipal taxes will have increased by more than 20 per cent since 2012, far outpacing the consumer price index (CPI).
According to Statistics Canada, CPI has increased by 5.5 per cent since 2012 and as of October it is on pace to increase by another 1.5 per cent in 2016.
CPI is a good indicator of changes in consumer prices experienced by Canadians. It is obtained by comparing, over time, the cost of a fixed basket of goods and services purchased by consumers, such as food, shelter and transportation.
In other words, CPI is a good indicator of what people can afford.
In an ideal world, property tax increases would be tied to CPI or inflation, but the reality is very few municipalities seem willing of doing this.
While it’s inevitable costs will rise, there are ways to cut costs and limit tax increases and this year’s budget is no exception.
Right off the bat the municipality could have cut the 2017 operating budget by $40,000 if it decided to opt out of hosting the Tour of Alberta next summer. Instead it approved spending $50,000 to host a stage of the race, $10,000 of which was left over from last year’s budget.
Fortunately, the interim budget that was passed by council on Dec. 20 can still be changed and savings can still be found.
Take for example a $10,000 line item for a trip to Hakone, Japan, Jasper’s sister city. The majority of councillors have indicated they don’t intend to go to on the trip next year.
Another option could be reducing the Library’s request for an additional $25,000 for wages and benefits or dramatically cutting the Community and Economic Development Fund, which doles out $25,000 annually to local organizations to host events like the
Jasper Folk Music Fest and the Jasper Heritage Rodeo, surely these groups can find other revenue sources.
If council can find about $74,000 in savings it would be able to cut the municipal tax increase by a full percentage point down to 2.01 per cent.
The proposed tax increase could also be reduced by a further 0.5 per cent thanks to a $37,000 tax over levy that was approved in 2016, however it will depend on how many properties try to appeal their property assessments next year. That money will be applied to the 2017 tax rate when the bylaw is set in June.
Taking this into consideration the property tax increase could be reduced to 1.5 per cent, which would likely fall in line or even come in slightly below CPI for 2016.
Proponents of the tax increase will astutely point out that the proposed tax increase of 3.01 per cent is very reasonable, given last year’s increase of 4.55 per cent and the fact that Banff approved a 4.8 per cent increase for 2017.
While it’s a fair argument, it shouldn’t negate efforts to find items to trim from the budget.
If we can limit tax increases to CPI, not only will residents keep more of their hard earned money, but it will also send a clear message that the municipality is living within its means.