City of Powell River Council has been presented with the first draft of the 2023 to 2027 financial plan, which indicates a 5.4 per cent increase in property taxation.
At the November 29 committee of the whole meeting, chief financial officer Malorie Denniston provided an outline of the city’s plans for the budget, which will go through three drafts before final adoption before May 15, 2023.
Denniston told councillors the first draft had been prepared based on direction provided at the city’s August finance committee meeting.
“I am seeking direction to continue with the financial plan timeline,” said Denniston.
She said the direction at the August finance committee meeting was to maintain service levels. She added that between August and the completion of her first financial plan draft to councillors, she has worked with all of the city directors to go over their operational budgets, propose any changes and find ways to save.
Denniston said draft one was focused on the operational budget. Draft two and three will focus on special projects, she said, and there will be focus on the tax rate, because the city will have the completed rolls in January, which will be the net assessable values the city bases tax rates on.
Denniston said the first draft proposes a 5.4 per cent increase for property taxes. She said she was at a tax rate training session recently with about 20 other municipalities and participants were polled on rates being looked at by their municipalities. The lowest was 4.7 per cent and the highest was 18 per cent, she said, which is what that municipality will have to work its way down from.
“The tone of that rate setting training was about this being a difficult year for cost increases,” added Denniston.
She then had the directors of city departments present their budgetary requests, which outlined changes that some departments of the city are requesting. She said the directors, in preparation for the first draft of the financial plan, sometimes had to review thousands of line items to ensure each account had been scrutinized.
After presentations, Denniston said the 5.4 per cent increase is sometimes assumed by taxpayers to be operational costs, but there are also other considerations, such as transfers to reserve, to ensure the city has proper infrastructure replacement for the future.
Staggering statistic
Denniston said year-over-year inflation, as of the end of October, for BC, from Statistics Canada, is 7.8 per cent, “which is staggering.”
She said she cannot predict the assessments the city will receive from BC Assessment in January and that her calculations are assuming 2022 values. She also said she does not know what other taxation authorities will be requesting, such as qathet Regional District, BC Assessment and School District 47.
Denniston outlined how a 5.4 per cent increase in city property taxes would affect a tax notice, based on her assumptions, “which will change.”
She reviewed a pro-forma tax notice she prepared for an average single-family dwelling based on the 2022 figures.
“The total increases to taxes and fees would be 5.72 per cent, or $192, on an average single-family dwelling, based on current year data, given these assumptions,” said Denniston.
Councillor George Doubt made a motion that change requests made in the first draft of the five-year financial plan, which would add new positions to city staff, operational budget increases for Powell River Public Library, plus training and wages to facilitate enhanced first responder training, be included in the second draft of the financial plan.
Doubt’s motion included staff being directed to continue with the financial plan timeline, public engagement process and preparation of the 2023 to 2027 financial plan drafts based on city services funded in 2022, as approved at the August 25 finance committee meeting. It also included that the second draft be prepared in accordance with deliberations and instructions provided by the finance committee at its November 24 meeting.
The motion carried.
