City of Saskatoon proposes 3.51 per cent property tax hike in 2022

Saskatoon's finance department is recommending that property taxes increase by more than 3.5 per cent next year to maintain city services.

On Wednesday, the city released its preliminary budget for 2022 and 2023 in advance of city council beginningbudget deliberations next week.

"I think that administration really focused on maintaining services while continuing to manage the implications of COVID-19," said the city's chief financial officer Clae Hack.

"We feel the proposed property tax and budget is the lowest we could achieve without impacting service levels."

If approved by council, the 3.51 per cent increase in 2022 would mean a homeowner with a house worth $344,000 would pay an extra $67.29 next year, or an extra $5.61 per month.

In 2023, the proposed increase of 3.14 per cent would mean the same homeowner would pay an extra $62.33 per year, or an extra $5.19 per month.

In total, the tax increase will bring in an additional $9.3 million in 2022 and $8.8 million in 2023.

In 2021, the city saw a tax increase of 2.83 per cent.

The city expects COVID-19-related expenses tocost $13.85 million next year and $10.02 million in 2023. That number includes $5.49 million in lost revenue to Saskatoon Transit next year, along with $948,300 less money collected in parking revenue. The city expects to pay for those costs through the Canada Infrastructure Program reallocation pool.

Hack said keeping a balanced budget is difficult, as user fees from leisure centres and grants from the provincial and federal government are not keeping up with inflation, meaning that property taxes are absorbing a larger per cent of the tax burden.

Council decided on some cost-saving measures before the preliminary budget was completed. Phase-in money for the upcoming Bus Rapid Transit system was deferred until 2024, and the decision was also made to move the upcoming curbside recycling program to a fixed monthly fee in 2023 and remove it from property taxes.

Before those changes, administration had estimated taxes would increase by 5.96 per cent in 2022 and 5.42 in 2023.

The Saskatoon Police Service will be the city's costliest department at $119 million, followed by $90 million for transportation and $55 million for the fire department.

Staff wages currently make up 59 per cent of the city budget. The city said it's tied into a number of collective bargaining agreements with its unions, and that it is required to meet those obligations.

Large spending items next year include $32 million for roadway preservation, $52 million for land development and $107 million for utility infrastructure maintenance.

City council will begin budget deliberations on Monday.