Olds council will vote on April 28 on a proposed three per cent tax increase for the community after the town exceeded its snow removal budget this winter.
Olds council will vote on April 28 on a proposed three per cent tax increase for the community after the town exceeded its snow removal budget this winter.
At its policies and priorities meeting on April 22, council passed a motion to bring the proposed tax hike forward at its next regular meeting.
The decision comes despite a pledge from the town not to raise taxes in its 2014 budget that was approved in December.
But winter storms this season that chief administrative officer Norm McInnis previously described as "extraordinary" resulted in the town spending $192,200 on truck rentals for snow removal. The budget for the rentals was set at $80,000.
"Certainly, we made a commitment and we can stick to that commitment but what it does, it kicks the can down the road a little bit so it will require perhaps a larger increase in the 2015 budget so that's one of the considerations," McInnis said.
A three per cent tax increase would raise about $222,930 to fully fund snow removal for this year. Any residual amount would go back into snow reserves that were spent this winter, McInnis said.
However, a three per cent increase might not be enough.
During the meeting, Coun. Harvey Walsh asked what percentage is required for the tax increase to cover the snow budget and replenish reserves.
McInnis replied that approximately $382,000 would be needed and that for each one per cent increase, about $75,000 is raised.
"Even the three per cent's not going to fully fund what we've spent in (2013-14)," McInnis said.
Councillors had little appetite to approach residents with cap in hand for spring adjustments after raising expectations that their taxes rates would not climb. But there was acknowledgement that the shortfall had to be covered somehow.
"I don't like the three per cent because we did tell our citizens back in the fall that we weren't going to have an increase. However, probably our citizens do understand with the unusual snowfall, we did have to utilize more of our reserves towards that," said Coun. Mary Overwater.
She added that when budgeting in the future, the town should not indicate one way or another whether taxes will go up or down.
Mayor Judy Dahl was the lone vote opposing the motion and said she would be in favour of reducing the town's 2014 budget to accommodate a lower tax increase.
"I do personally believe that there are areas that council needs to review where dollars can be saved. I just wasn't prepared at this time to close the discussion at three per cent. I wasn't ready," Dahl said. "We need the money to cover an act of nature and it's not going to go away but my mind was saying, I'm not ready to close the discussion."
According to a document included in the policies and priorities meeting agenda, 194.7 centimetres of snow fell in Olds from November to March this winter. The 30-year average during those months is 83.6 centimetres.
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