Kamloops council got a look on Tuesday morning at next year’s provisional tax rate, a 3.4 per cent increase — or about $65 for the average assessed residential property.
The meeting was the first in a long line of public budget talks that will culminate next spring when the final tax rate is set.
“The proposal you place before us would result in the largest tax increase in the City of Kamloops in the last decade,” Mayor Ken Christian told staff. “So the challenge before us is pretty evident.”
Though the preliminary rate increase became public on Tuesday, city staff have been crunching the numbers for months behind the scenes, with planning that began in June.
City finance director Kathy Humphrey detailed financial hurdles at city hall. In 2019, the city’s overall funding will increase by six per cent, or about $6.5 million. More than half of that bill is courtesy the B.C. NDP government’s employer health tax ($1.2 million) and RCMP services ($2.7 million) to add three staff and increase the overall policing contract.
The provisional budget also includes more than $2 million in provincial taxes and rate increases expected to be levied on the city next year. BC Hydro is up three per cent ($212,000), ICBC is up five per cent ($27,000) and the carbon tax will have a 14 per cent impact ($425,000).
“Clearly, about two per cent of that total I would characterize as downloading from the provincial government,” Christian said.
Wages also account for about two-thirds of the city’s new expenses, at $4.3 million. In addition to the RCMP contract, the city’s fire contract will increase by 2.5 per cent ($670,000) and CUPE employees and management salaries are estimated to rise by $940,000. That contract expires at the end of this year and has yet to be negotiated.
A staff request for an additional $400,000 for snow and ice removal will be discussed by council on Tuesday afternoon.
Humphrey said most of the added costs are out of the city’s control, noting staff have been working to find efficiencies and increase revenues across departments in order to help offset costs. Department heads detailed for councillors on Tuesday some of the ways in which they have sought efficiencies. The streets department has been swapping resources with the parks department. The parks department completed a successful pilot program in which a green herbicide has been used on city fields and will result in less need for mowing and equipment.
That, coupled with one per cent growth anticipated in 2019, means the city is still on the hook for an extra $5.7 million overall in funding. Staff are suggesting $2.1 million be taken out of reserves for one-time costs, such as the employer health tax, and the remainder come from the proposed tax increase of 3.4 per cent.
Annual Kamloops residential property tax increases in the past decade have averaged 2.2 per cent. Last year, taxpayers saw a 2.1 per cent increase compared to 2.7 per cent in 2017 and 2.4 per cent in 2016.
The proposed increase only accounts for the municipal portion of tax bills. Add in utility fees and the average household could be on the hook a four per cent spike next year, based on the preliminary numbers. Budget talks continue in council chambers next Tuesday. A public budget meeting will be held on Wednesday, Nov. 28, from 7 p.m. to 9 p.m. at McArthur Island Sport and Event Centre.
Supplemental items will be introduced in January. The final tax rate will be set at the end of the first quarter in 2019.