Vancouver homeowners could see 9% property tax increase over next 5 years, budget outlook projects

Vancouver property owners could see steady increases of nine per cent on their property tax bills for the next five years, according toa budget outlook report presented to city council Monday night.

The report suggests that in order to balance the budgetand keep service levels where they are currently, the City of Vancouver would needto implement the nine per cent hike every year from 2024 to 2028.

For the average strata property owner, that would equate to anincrease of about $116 each year. Property taxes for individual properties are calculated based on their value as appraised by B.C. Assessment.

The potential increase is a projection by city staff.The budget will likely go through several revisions before it's finalized near the end of the year.

Coun.Sarah Kirby-Yung, who ran in the 2022 election under the ABC Vancouver banner alongside winning mayoral candidate Ken Sim, told CBC News the increase is not idealand the mayor's budget task force is reviewing the budget on a line-item basis to figure out where things could be more efficient.

The task force was set up to examine where city funds were being allocated after council approved a 10.7 per centproperty tax hike for 2023.

"When we passed the 10.7 per centproperty tax increase last time, MayorSim stated that these increases can't become the norm. It's not sustainable and affordable for people," Kirby-Yung said.

"We recognize that residents and our small businesses are really being hit hard in terms of increasing cost pressures, material labour costs the same things the city is dealing with. But we are looking at ways to bring the tax increases in line to be more reasonable."

'Extraordinary fiscal pressures'

Staff said the city's budget is facing "extraordinary fiscal pressures" from a number of factors.

Inflation, a tight labour market, supply chain issuesand behavioural changes from the pandemic have all contributed to higher costs and lower revenue.

The city's capital expenditures between 2024 and 2028 are estimated at $730 million a year, accounting for the delivery of existing projects and also additional investments included in the 2023-2026 capital plan.

"This level of project delivery is a significant increase from past levels and is required to meet asset renewal requirements, provide new amenities in response to population growth, and address city goals such as the Climate Emergency Action Plan," the staff report said.

Operational costs are also expected to grow over the next few years, affected in part by items in the 2023 budget that include the hiring of additional police officers, infrastructure renewal projectsand Metro Vancouver levies.

Staff are "acutely conscious" of the implications of the rising costs oftax and utility rates and are looking for new efficiencies and revenue streams, the report said.

Cuts, efficiencies, opportunities

Coun. Christine Boyle of OneCity Vancouver said she's interested to see where the budget task force thinks funding can be streamlined but cautioned against cuts to serviceslike libraries, parksand homelessness programs.

"What you consider an important service in Vancouver is different depending on what your life looks like. In Vancouver, it's different for families, for isolated seniors, it's different for renters. So, we need to make sure we're supporting the services that all of those residents rely on," Boyle said.

"That's an important piece of the conversation about what we can afford to cut, and [which]cuts will really heavily impact residents in Vancouver."

Kirby-Yung pointed to newly launched systems that will allow building permit applicants to check whether they're compliant with city regulations before they submit an application, saving staff from manually reviewing them.

Kirby-Yungalso highlighted a January report from the city's auditor general that found in some cases, Vancouver was actually undercharging developers for permitting applications.

She said the city was also looking at revenue opportunities in projects like the planned newPNE amphitheatre.

"There are some amazing sponsorship opportunities there.[There's] lots of interest in that project and potentially other city assets. So, I think there's obviously other ways to mitigate the property tax increase," she said.