St. Albert’s average tax rate will increase 3.6 per cent, or $31 per $100,000 of assessed value, in 2025.
Councillors spent nearly five hours voting on more than two dozen individual proposals to knock 0.8 per cent off the proposed increase and settled on the final budget document Monday, Nov. 25.
Tearing up, Coun. Sheena Hughes, who proposed a number of the reductions, said she felt “so respected” by her colleagues at the end of the meeting.
“I want to thank council for this session today,” she said, thanking also city staff for their help. “We have made a difference in peoples’ lives.”
By the same token, she appeared somewhat crestfallen when reminded that all their efforts were countered to the tune of 0.4 per cent of the increase when staff presented a revised estimate of the costs Bill 20 would add to next year’s municipal election.
In the first draft of the 2025 budget, the tax increase was 4.5 per cent. The first big step council took to mitigate that increase was to hike the franchise fee the city collects from utility bills to 25 per cent. That is expected to bring in around half a million dollars in revenue and brought the proposed increase to 4.0 per cent.
But just weeks later, administrators were back before council with their revised election budget, which projected the 2025 vote would cost nearly $940,000, up from $261,500 in 2019, bumping the increase back to 4.4 per cent.
The last measure council took had one of the most significant impacts to the tax increase: A unanimous endorsement of Coun. Shelley Biermanski’s proposal to use $259,700 from the city’s growth stabilization reserve fund to lop off a final 0.2 per cent.
Coun. Wes Brodhead liked this one because it fell within council’s fiscal policies and allowed them to provide some “relief” to the taxpayer. Hughes agreed.
“Every dollar we wait to spend or save decreases its buying power,” she said. “Giving to taxpayers today helps more than tomorrow.”
Pinching pennies
St. Albert won’t increase its municipal subsidy fund to meet rising demand after all. The first draft of the budget included a business case for adding $200,000 to the program, which allows residents who qualify to access free transit and some recreational programs. Monday’s vote ruled out the increase.
Requests to the St. Albert Subsidy Program are up 50 per cent since 2022 and 159 per cent in the last five years because of inflation, the economy and newcomers.
The business case for the increase indicates the city has been trying to cover the growing expense within existing operations, but “this is not sustainable. Demand is expected to continue."
City staff intends to "review all policies and administrative directives related to this program to ensure council's support for the proposed funding approach and maintain consistency" and report back in Q2 of 2025.
Accounting magic
Council also decided to do some accounting adjusting to affect the tax rate, voting to increase the planning and engineering department’s estimate of how much permit revenue will come in next year.
Hughes questioned how the city could justify running an $8.8 million surplus with significant increases to revenues seen in 2024 not accounted for in the 2025 budget. In a nutshell, the more revenue departments foresee collecting in the coming year, ultimately, the less the city has to ask taxpayers for.
The increase of $542,000 was “conservative,” according to Hughes, and kept the projection for 2025 a million dollars below what will have been collected in 2024.
A table included with the council agenda shows the value of building permits increased by half from nearly $260 million in 2023 to more than $390 million in 2024. The revenue the city collects from those permits increased 72 per cent from $2.3 million to $4 million.
Mayor Cathy Heron advocated for the opinions of the city's accountants.
“Who is the better to predict, this council who doesn’t spend time in the development and permitting department, or the experts? Which is why I tend to trust their judgment.”
Staff warned against basing a revenue projection on a “record-breaking” year.
“A similar volume trend for this permit type is not predicted for the 2025 budget year and therefore, while revenue is expected to exceed the 10-year average, it is difficult to justify a 15 per cent increase,” a backgrounder reads. “Consequently, administration recommends exercising caution when predicting revenue, as any shortfall could negatively impact the overall budget and operations.
“Moving forward with the motion could result in a budget shortfall, should the revenue assumptions not be realized.”
Council approved the change with Heron and Coun. Natalie Joly opposed.
“I respect your concerns, but we have a $10-million surplus this year and only $4.5 million of it came from (vacancies) — $1.5 million came from this area and it was not increased at all this year,” Hughes said.
Council voted unanimously for a similar change to the Servus Credit Union Place budget, reducing its annual deficit subsidy by $120,000. This change anticipates another 200 people buying memberships, 50 per cent of the increase seen the previous year.
The plan is that this will be made possible in part by the efforts of whoever accepts the new $90,000 marketing position for the facility councillors also approved Monday.
Coun. Ken MacKay worried they were putting the horse and the cart in the wrong order with the subsidy reduction and asked where staff would see that growth.
Daniele Podlubny, the city's director of recreation of parks, said Servus Place has been seeing increases of 400 members per year since the end of the pandemic. She said the goal of adding 200 in 2025 was "very realistic" and there is more traffic in all parts of Servus, but the workout equipment is most popular.
"The first step is really to understand our users a bit better and that’s work we have planned for this year," Podlubny said. "Membership really does use all areas of the facility."
Joly and Heron also opposed this change, to no avail.
‘It’s not rocket science’
Biermanski took a swing at a general reduction motion that would have called on each of the city’s five major departments to find an average of $10,000 in efficiencies for a total of $50,000, which would have reduced the tax increase by 0.03 per cent, according to a staff report.
Brodhead said he disagreed because it wasn’t a “governance” motion, but Biermanski said businesses do this sort of thing all the time.
“It’s not rocket science to eliminate the wasteful things, to not buy something that you probably shouldn’t,” she said. “We can say peoples’ budgets are tight but there’s always something to be found.
“Every position, every increase ask we’ve approved today, has been going on for a number of years," Biermanski said. "In three years, (we’ve added) 42 positions. Those jobs, I haven’t seen the return, (and) we’re at plus $26 million in operating costs, so I just want some sort of direction for administration to have an incentive or some sort of means of feeling like it’s success in finding things. It’s not punishment, it’s not negative direction.”
The proposal failed, with only Biermanski and Hughes in favour.
