INNISFAIL – Town council began its final day of the 2023 budget deliberations last week looking to cut $64,730 to get to a balanced budget.
Most importantly council members needed to get there to maintain a four per tax increase for Innisfailians that will go towards covering the town’s operating and capital budgets for 2023.
This year’s budget deliberations were especially difficult for council and administration as they were facing extraordinary challenges caused by the ongoing sluggish Alberta economy, high interest rates and inflation.
There were also deep cuts to provincial Municipal Sustainability Initiative (MSI) funding for infrastructure projects, mounting pressures on the town’s Emergency Management Services, and paying $125,000 more in 2022 for the escalating cost of natural gas and electricity.
In the meantime, the town is still determined to move into the future with its big plans for industrial growth, a new improved aquatic centre that could morph into a full multiplex and many other capital projects, including several smaller but essential ones itemized in the 2023 capital budget.
There was considerable discussion on how to get to a balanced budget, including potentially dipping into reserves, raising taxes even higher, increasing franchise fees, and even cutting cost of living increases for staff.
But halfway through the morning of Nov. 29, the third and last day of budget deliberations, administration was tasked to find $64,730 worth of items to trim or cut.
Following a 40-minute break, administration came back to announce it had achieved a balanced budget with cuts to several items, including $15,000 off the operations budget for a summer student, $10,000 from what was set aside for the new assistant fire chief position, $5,000 for a planned DocuSign program, and $10,000 off the events budget.
Erica Vickers, the town’s director of corporate services, also found two items to turn into revenue, which in the end balanced the budget.
Vickers will ask town council on Dec. 12 to approve a 2023 operating budget of $25.8 million and a capital budget of $4.4 million for 19 local projects, which includes infrastructure replacement work, a park project, equipment and new vehicles, and municipal facility improvements.
The overall budget package proposes a four per cent municipal tax increase for all owners of Innisfail’s residential and non-residential properties.
For a home that is assessed at $322,210 a four per cent property tax hike translates into a monthly increase of about $7.46, or nearly $90 a year.
As well, property owners are facing a monthly $2 increase on their 2023 wastewater bills, as well as $1.50 monthly hike for water.
When those utilities are added to the tax hike property owners are looking at a total monthly increase of just under $11.
As for the school taxes from the province, the town will not know until sometime in the first quarter of 2023 or even longer when the province introduces its budget.
The town also had to factor into the 2023 budget the first year of its annual interest-only payment of $264,000 for the $5.5 million loan it is taking for the development of the new Southwest Industrial Park, a project that is hoped to recoup all costs through land sales.
Mayor Jean Barclay said after the budget deliberations she was pleased with the way administration found places where the town could make saving for 2023 and was “happy” where the town ultimately found itself to be able to move forward in these challenging financial times.
“I believe most communities, if not all, are facing the same issues,” said Barclay, admitting that a four per cent increase sounds hefty. "We've been looking at proposed tax rates throughout Alberta. Administration did a good job of that, and we are certainly not the highest.
“We worked very hard going through the budget line by line by line and trying to figure out how we can make things work. It's a matter of choosing the priorities that are going to be the most impactful at this point in time,” she added. “Because you cannot do everything you want to do.”
Vickers told council members during deliberations that compared to Innisfail many other municipalities across the province are set to raise their taxes even higher.
Council was told Ponoka recently approved a four per cent tax hike, while the City of Lacombe approved an increase of five per cent. The Town of Olds is looking at an increase of between three and five per cent. Edson is looking at a 7.71 per cent increase, while Blackfalds is considering a 4.5 per cent hike.
Morinville could be as high as 10 per cent, with the City of Wetaskiwin considering a hike of 9.5 per cent. Cochrane is looking at a 7.55 per cent increase while Canmore is proposing a whopping hike of 12.5 per cent and Banff is looking at a hike of 10.26 per cent.
“There are some pretty significant increases across the province,” said Vickers.
