Administration shared a preview of the proposed adjustments to the 2023-2026 Service Plans and Budgets with Council. The information presented is a preview of the budget that will be presented in November. Each year, we refine our service plans and budgets to reflect changes in the current economic environment and ensure we’re responding to Calgarians’ needs.
The City of Calgary has been facing pressures affecting service delivery and citizen satisfaction since the adjustments to The City’s service plans and budgets in 2023. The most pressing issues include aging infrastructure, rapid population growth and inflation.
·Aging infrastructure: A critical water main break that affected city-wide water usage highlighted the need to increase infrastructure investment for inspections, maintenance and repairs.
·Rapid population growth: Calgary’s population has grown by 5.6 per cent since 2023, significantly impacting City service delivery, citizen satisfaction and housing demand. Calgary’s population grew by 69,000 people last year, more than the population of the City of Medicine Hat.
·High inflation: Calgary’s inflation reached an average of 3.8 per cent last year, that is a 1.2 per cent increase than the originally forecasted 2.6 per cent used for budget planning. This increase escalated the costs of major capital projects and required new funding strategies.
With infrastructure, population and inflationary pressures continuing to build and Council’s direction to maintain 2025 property tax increase at 3.6 per cent (5.5 per cent for residential and 1.4 per cent for non-residential), The City examined its investments and funding priorities to minimize tax increases and provide Calgarians with a safe, sustainable, and resilient city. As a result, a total of $107 million in tax-supported operating budget and 228.9 million in capital funds were identified during this process.
Despite finding these efficiencies for Calgarians, further investments are required to deliver on Council priorities and maintain current service levels.
For 2025, Administration is proposing:
· An increase in property tax revenue by an additional 0.9 per cent for 2025. Altogether, tax changes from this recommendation, plus the previous approvals and the tax shift, will increase the tax bill by $8.86/month for a median residential property assessed at $700,000.
· An increase to user fees for Water and Waste & Recycling by 3.7 per cent in 2025 to address continued population growth and inflation, infrastructure and inspections and repair needs. This will result in a $5.09/month increase on the typical residential water & waste utility bill in 2025 (based on typical metered water usage of 19m³ per month).
This proposal will mean the median residential property assessed at the median $700,000 in 2025 with metered water use of 19m³ will pay an additional $13.95 per month for total City Services.
“We aim to strike the best balance between delivering City Services and maintaining existing infrastructure, while continuing to advance important city-building capital projects and housing availability to accommodate Calgary’s unprecedented growth,” said David Duckworth, Chief Administrative Officer. “The investments in this proposal are top priorities and are needed to maintain Calgary’s reputation as a world-class city that is safe, sustainable and resilient for the future.”
The City has worked hard over the past decade to keep its operating expenditure in line or below the combined population and inflation growth rate but is currently $1 billion short of this benchmark. Even with significant investments made last November (pink line) and proposed investment for 2025 (blue line) we remain well below combined population and inflation growth rate.
Population Growth and inflation are outstripping spending
“Like Calgarians, The City is seeing the impacts of population and inflation growth; rising costs are affecting service delivery, infrastructure maintenance and capital projects that have reduced The City’s financial flexibility,” said Carla Male, Chief Financial Officer at The City of Calgary. “Administration’s efforts to find efficiencies for has helped minimize property tax increases for 2025; however, sustaining our current level of City services in the future will require additional investment.”
Have your say on budget adjustments
Council will be deliberating and deciding on our plans and budgets adjustments in the month of November. But before that, there’s still an opportunity for Calgarians to help Council identify which are the most important investments. Calgarians can provide written feedback to Council or register to speak with members of Council in November at calgary.ca/PublicSubmission.
Green Line
Council directed Administration to bring recommendations to the September 17, 2024 Regular Meeting of Council to address the next steps for the Green Line Stage 1 program. Currently, The City is working to determine how the Green Line Stage 1 program might impact the 2023-2026 Service Plans and Budgets in November.
-30-
