Tax hikes or service cuts looming for Saskatoon after provincial budget

The City of Saskatoon says it will be forced to raise property taxes or cut back services to make up for a loss of almost $16 million from theprovincial budget.

A special meeting of city council has been called for Sunday to consider possible measures to deal with the hole in its budget.

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In a reportreleased on Friday in preparation for the meeting, the city says the provincial budget's net impact on the 2017mill rate is an additional 3.93 per cent.

Added to the December2016 tax increase of 3.89 per cent, it would total 7.82 per cent.

Saskatoon Mayor Charlie Clark said earlier in the week that budget changes could lead to a "fiscal crisis" for the city.

"This leaves a significant hole in our operating budget," he said in a news release on Friday.

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"It forcescity council to choose between raising taxes or making cuts to core services like snow clearing, leisure facilities, policeor fire."

The biggest concern for the city is the province's decision to revoke a program that pays grants in lieu of property taxes for Crown corporations.

Wednesday's budget put an end to $36 million in grants from SaskPower and SaskEnergy, which were paid to municipalities in lieu of property taxes for infrastructure.

The city says it stands to lose $11.4 million annually, or the equivalent of a 5.63 per centtax increase.

The 2017 impact would be reduced to $8.3 million, or about fourper cent tax, because it is only for part of the year.

The Friday report also outlines other impacts to the city's budget, including the loss of more than $600,000 in funding for the Saskatoon Public Library.

It says the PST increase to six per cent could cost the city up to $2 million dollars.