Whitehorse homeowners and businesses can expect an increase of 1.2 per cent on their property taxes if the city passes its 2017 operations budget.
The budget got its first reading at the city council meeting Monday night.
Provided the budget is approved by council, the average homeowner will pay an extra $47 next year, according to the city. The average business will pay an extra $358.
“Taxes help pay for our roads, fire protection, recreation facilities, parks and trails, transit, planning, engineering, and other operations that help keep our city running,” Mayor Dan Curtis said during his budget speech.
“Taxes in Whitehorse remain lower than many other comparable municipalities and our proposed low tax increase will help keep it that way.”
The 1.2 per cent increase is the lowest the city has seen in years. The last three years have seen tax increases of 1.7 per cent.
Water and sewer rates are not covered by property taxes. Those fees are slated to go up four per cent in 2017. That’s an increase to $78.98 a month from $75.94.
Tax increases are part of the city’s operating budget. The total 2017 operating budget is $73 million. About half of the operating budget is funded through taxes and the rest comes through government fees and grants, the mayor said.
Included in the budget is money to increase transit service to Whistle Bend.
“A growing community along with the new long-term care facility will create higher demand for our transit service,” he said.
The city is also hiring a new fire prevention officer who will “help ensure our residents, including the most vulnerable, live in safe buildings that meet the fire code.”
Money has also been set aside in anticipation of Whitehorse hosting the 2020 Arctic Winter Games, he said.
Following the meeting, the mayor balked at the suggestion that taxes could have not been raised at all.
“The worst thing any community could ever do is give a zero per cent tax increase because inflation keeps on ticking away,” he said.
“They’ve done a lot of studies to say if you have a zero per cent tax increase, it’s going to catch up with you. So zero percent this year probably means double or triple the next year (or) the year after.”
A public input session regarding the operating budget is scheduled for council’s Jan. 16 meeting. Second and third readings are then scheduled to come forward Jan. 30.
The operating budget wasn’t the only major financial decision Monday.
Council passed the city’s 2017 capital budget, which includes $39 million towards the construction of a new operations building.
Coun. Samson Hartland was the only one to vote against that budget.
Hartland has been a vocal opponent of the city’s plan. On Monday he said that while he agrees the current municipal services building needs to be replaced, he doesn’t think the city is going about it the right way.
He’s concerned about borrowing $18.8 million with an expected annual debt service cost of $1.5 million.
The city’s debt management policy will need to be changed to allow it to borrow that amount. Right now it says the city is only allowed to borrow a maximum of $500 per person in Whitehorse.
The current proposal would cost just over $1,000 per person.
Hartland said the city should go back to the community to get approval for such a change.
The city has other options it should be exploring before going into debt to build a new building, he said.
“I see a number of new office buildings for sale that the city might consider investing in for a fraction of the cost of what’s currently being proposed for a new operations building.”
Curtis said that while the city could rent office space, space to put the large equipment is not available. Rental costs would become part of the city’s operating budget, not its capital budget, and would be paid for with higher taxes, he said.
Coun. Dan Boyd, who has also raised some concerns about the plan, voted in favour of the budget because plans for the new operations building will come back to council once the designs are complete and before it goes out to tender.
“There is more information that I require before making a decision. It’s the operating costs,” he said.
Those operating costs are not available until the design of the building is complete, according to city staff. There is no line item in the 2017 operating budget for that cost.
Staff confirmed Monday that the building is not expected to be complete until late 2018 or early 2019.
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