Sometimes it seems the best decision on a tough problem is to delay a decision.
Calgary City Council gathered on Monday to figure out how to head off large property tax hikes for business property owners outside of downtown.
It had eight different options on the table.
And after hours of debate, council voted to wait one more week before deciding which of two scenarios it will use to set 2019’s tax rates.
The city has a $250 million problem it’s trying to solve.
That’s how much less tax money it will take in from downtown property owners as their assessments decline. That load will land on business property owners outside the core.
However, council is looking at options for shifting some of that load onto the half-a-million residential property owners.
Under a new scenario presented by Mayor Naheed Nenshi on Monday, the owner of a median-priced house assessed at $485,000 could end up paying about $120 more in 2019 than last year.
That’s a tax hike of 3.45 per cent.
There could be a bigger tax increase under another scenario.
Coun. Jyoti Gondek suggested transferring more of the tax burden to homeowners so that residential and non-residential accounts each pay half of the city’s tax requirements.
Where things get complicated is in deciding who the city chooses to help as the tax burden shifts.
Under Nenshi’s proposal, a $70-million grant program will be developed for this year and next year to help businesses still facing large tax increases.
“My point is,” he said, “I’ve got $35 million a year and can we use that $35 million a year to funnel larger grants to people who really need them, rather than spread it across many, many people. That’s my goal.”
Under Gondek’s plan, the city would reach into savings to give homeowners rebates to ease their adjustment to higher tax levels.
In each of the past two years, the city spent almost $30 million per year to give business property owners a rebate to limit tax increases to no more than five per cent.
Nenshi makes no apologies for council’s decision to delay finalizing this year’s tax rate.
“Look, this is a tough decision, and we’ve kicked it from meeting to meeting to meeting already. Hey, what’s one more week?” the mayor said.
Absolutely not, says council
A proposal from Coun. Evan Woolley to cut this year’s budget by $100 million was roundly rejected by council.
Woolley said afterwards that without reducing the tax requisition, it’s that much tougher to resolve this problem without affecting business property owners.
“The business community will continue to bear the significant burden of that downtown shift and I don’t think that that’s fair,” Woolley said.
“We are unwilling to take a deeper look at our own budgets and move those efficiencies up.”
Mailing time nears
He also expressed disappointment that on the day council was supposed to make a decision and set tax rates, it didn’t.
“We’re unwilling to make a decision. We’ve punted this for another week,” he said. “We have to get our tax bills out the door.”
The city does need some lead time to print tax bills once it sets the mill rates for the year.
Normally tax bills are mailed out in May with the deadline to pay the taxes owing by the end of June.
Council did decide to delay until later this year on making any changes to tax rates for 2020, 2021 and 2022.
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Sherwood Park is a large hamlet in Alberta, Canada within Strathcona County that is recognized as an urban service area. It is located adjacent to the City of Edmonton’s eastern boundary, generally south of Highway 16 (Yellowhead Trail), west of Highway 21 and north of Highway 630 (Wye Road). Other portions of Sherwood Park extend beyond Yellowhead Trail and Wye Road, while Anthony Henday Drive (Highway 216) separates Refinery Row to the west from the balance of the hamlet to the east.
Sherwood Park was established in 1955 on farmland of the Smeltzer family, east of Edmonton. With a population of 70,618 in 2016, Sherwood Park has enough people to be Alberta’s seventh largest city, but technically retains the status of a hamlet. The Government of Alberta recognizes the Sherwood Park Urban Service Area as equivalent to a city.
Sherwood Park, originally named Campbelltown, was founded by John Hook Campbell and John Mitchell in 1953 when the Municipal District of Strathcona No. 83 approved their proposed development of a bedroom community east of Edmonton. The first homes within the community were marketed to the public in 1955. Canada Post intervened on the name of Campbelltown due to the existence of several other communities in Canada within the same name, so the community’s name was changed to Sherwood Park in 1956.
The Sherwood Park Urban Service Area is located in the Edmonton Capital Region along the western edge of central Strathcona County adjacent to the City of Edmonton. The majority of the community is bound by Highway 16 (Yellowhead Highway) to the north, Highway 21 to the east, Highway 630 (Wye Road) to the south, and Anthony Henday Drive (Highway 216) to the west. The Refinery Row portion of Sherwood Park is located across Anthony Henday Drive to the west, between Sherwood Park Freeway and Highway 16. Numerous developments fronting the south side of Wye Road, including Wye Gardens, Wye Crossing, Salisbury Village and the Estates of Sherwood Park, are also within the community. Lands north of Highway 16 and south of Township Road 534/Oldman Creek between Range Road 232 (Sherwood Drive) to the west and Highway 21 to the east are also within the Sherwood Park urban service area.