OLDS — During its Dec. 11 meeting, Town of Olds councillors made one decision in regard to the town’s 2024 operating budget: they rejected a third option which would have left the town with a $511,961 surplus which would have been transferred to reserves.
But corporate services director Sheena Linderman says no clear decision was made on whether to go with option 1 or 2, so at the moment, it’s unclear how they plan to obtain the $615,920 needed to balance revenues and expenditures.
“With preliminary assessment figures showing a large increase, we will need to decrease our tax rate in order to minimize the impact to our residents,” Linderman wrote in an email.
“As it stands right now the average residential home would see an increase of approximately $9.92/month or (a) 3.82 per cent increase on their property taxes.”
A town news release says that applies for the average residential household assessed at $390,000.
"We started out the budget process with a loss of $509,000 in tax revenue over 2023 which is a five per cent loss in revenue."
In April, once the assessment is finalized and the province determines the education school tax, those options will be provided to council again so members can determine what route they want to take:
A document in council's agenda package outlined the three options facing council. It was noted that an anticipated increase in the assessed value of property could enable the tax rate to be lowered accordingly.
• Option 1 is a lower the tax rate plus a combination of tax revenue and drawing money from the tax stabilization reserve to keep taxes as low as possible.
• Option 2 is a tax rate decrease but obtaining the entire figure needed to balance the books via a tax revenue increase. No money would go to reserves.
• Option 3 involved a tax revenue increase but the tax rate would stay the same as in 2023. As noted above, this option would generate a $511,961 surplus which would have been transferred to reserves. A preliminary estimate suggests this would increase taxes for the average municipal household by $256 a year.
Council passed a motion setting the budget at $34, 044,722, reflecting the takeaway of $511,961 that would have been generated in option 3.
During debate on the budget, Coun. James Cummings appeared to be the lone proponent of option 3.
Cummings said since he’s been elected, he’s heard from administrative staff and fellow councillors that the town has been draining its reserves “and not properly funding any future work that we know is needed.”
He said option 3 is the only one whereby money would be put back into reserves.
He cited the $2.3 million water inflow and infiltration (I &I) issue as one example of costs the town will face as its facilities age and “crumble.”
Cummings conceded that an extra couple hundred dollars in taxes will hurt residents.
“But I’d like to make sure that we have clean drinking water for our citizens, that we have a place for our sewers to take the water to that's been used and that our roads can be driven on,” he said.
Councillors Harvey Walsh, and Darren Wilson appeared to argue in favour of option 1.
Dan Daley favoured option 1 or 2, Blatz came down in favour of option 2.
“We don’t know yet what the carbon tax would do or any other taxes coming forward, so I think we need to be very cognizant of that,” Blatz said.
Coun. Heather Ryan suggested keeping the mill rate the same and using a portion of the town’s tax stabilization fund to ease the burden on taxpayers.
“My concern is that we have this fund that we put aside for a rainy day and it’s raining, and I’m thinking that why would we not use a portion of it,” Ryan said noting that’s what the tax stabilization reserve is for.
“I have no problem using reserves,” Walsh said. They’re designated for what they’re being used for," he said.
Walsh said the I & I and other infrastructure problems probably aren’t going to be solved in the next 10 years or so anyway.
“I agree with coun. Cummings that we need to be conscious of how we are spending our money, but we can’t tax our residents to death in the short term,” he said.
“Our tax rate I think is reasonable if we keep it around that five per cent.”
Wilson was one of those using the raining metaphor.
He said the town is facing many issues, not only I & I, but the loss of revenue as the SNDL plant shuts down.
“With the loss of SNDL and the pressures we’re seeing, I certainly don’t have an issue accessing some of those funds – not draining them dry, but accessing some of those funds -- to help mitigate and manage the impact to our citizens,” he said.
“On the surface, it sounds like we’re quibbling and slicing things pretty thin on an annual basis, but affordability is a concern for a lot of people, maybe some people around the table here, I don’t know. So I did try to strike that balance,” he said.
Daley agreed with the points his predecessors made.
He too said it’s raining right now and echoed concerns about the impact of increased carbon taxes and inflation.
He said as a result, his preference would be option 1 or 2.
"Not everybody has the same income and not everybody has the same opportunities that some of us perhaps maybe have, so I think again, we have to be very cognizant at this point in time,” he said.
During the meeting, council also approved its $3,481,000 2024 capital budget, three-year capital plan, and five-year capital plan.
Chief administrative officer Brent Williams said those three and five-year plans provide some direction, but are just really guesswork, because it’s not certain what provincial funding will be available to implement them or portions of them.
Editor's note: This article has been updated with additional information.
