Calgary property tax increase could be smaller than expected next year

City administration is recommending a smaller property tax increase next year than what was proposed in the four-year budget.

Rather than a 4.7 per cent bump in the tax, the city says efficiency savings and borrowing against city reserve funds makes a 3.5 per cent increasewith no cuts to servicespossible.

"I don't know if that's going to be able to be continued in future years.It may be that we've only got the low-hanging fruit, or it may be that we've got all the fruit," said Mayor Naheed Nenshi.

"But we'll continue to find more of those efficiencies in the work that we do going forward."

Fees remain

The savings won't be translated to utility charges, transit faresor user fees at city facilities, which were approved in the budget last year.

That means small increases for things like taking a swim, but significant increases in utilities.

The flat rate on wastewater will go up 15.4 per cent over 2014, the metered rate will go up 16.9 per cent and stormwater drainage charges will go up 19.1 per cent.

Stimulus hopes

The proposalalso makes it possible to accelerate the timelines on some capital projects to help spur the economy.

The mayor said he agrees with administration's proposal and doesn't want the city to contribute to the economic woes buffeting the city. He says it makes sense for the city to take advantage of low interest rates, low construction costsand to give employment opportunities to Calgarians in the construction sector.

"It makes a lot of sense for the City of Calgary, rather than to wait around for the provincial and the federal governments to provide stimulus programs, to engage in a bit of self stimulus, which sounds dirty but isn't, and do a little more," he said.

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Nenshi says he's interested in getting to projects quicker to take advantage of the downturn, but warns that some projects come with additional operating costs, likewages or repairs.

"So we're really looking for, at this point, capital projects that have a very low operating impact," he said.

"So if you're building a new LRT line, the operating cost is very high, but it's actually lower than the buses that were there before."

Future savings

There is no guarantee that the savings will mean additional relief in future tax years, but Nenshi says the city continues to look for efficiencies and costsaving.

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Council will discuss thereport next Mondayand will see a capital budget later this autumn.