During the taxpayer’s introduction to the budget on Monday, Dec. 6, Financial Services Manager Travis Nosko stated, and I’m paraphrasing here, that to solve Morinville’s operational deficit problem in one year, Council would need to raise taxes by 26%.
Certainly, a 26% increase would be an untenable position for residents. It would be hard for elected officials to swallow such a pill as many councillors ran on a low tax platform.
But they were not asked to raise taxes by 26%.
Instead, Administration is recommending a 5% increase to the mill rate for residential property owners and a special 0.81% tax to pay for roads and sidewalks. The latter is to make up for the roughly 60% they say was cut by the Government of Alberta from the Municipal Sustainability Initiative (MSI).
You may have read Morinville Online’s coverage of Council’s deliberations earlier this week and thought to yourself, “Nearly 6%. Are they out of their minds?”
But the reality is that the recommended increase is almost 16%.
From the Agenda package, which was not available until just before the meeting, we see that:
“For the average residential property valued at $331,629, the homeowner can expect a $2,643 tax bill which results in an annual increase of $126 or $10/monthly.”
We also see that: “For an average residential property, assessed at $331,629, the special tax levy would be $269.” If the 2022 tax bill of $2643 is a $126 increase from 2021, the 2021 tax bill was $2517.
A tax increase of $126 plus another $269 for the special tax is a combined tax increase is $395 or 15.69%.
On the business side of things, a commercial property valued at $852,515 will see an $8,153 tax bill, an increase of $1,035 or $86/monthly. They would also pay a special tax of $691. That business whose 2021 tax bill was $7118 would now pay $8844, a $1726 increase or 22.4%.
So let’s call this budget what it is – a very substantial tax increase while residents and businesses are trying to get back on their feet.
Veteran Councillor Scott Richardson was correct in putting the brakes on passing this budget before Christmas. His fellow councillors were also right in supporting his motion to look at an interim budget, presumably, so Council can look at ways to lower the increase.
An interim budget allows the Administration to keep the lights on and keep people working but does not allow for other spending or capital projects to be tendered.
Council would then have until the end of the fiscal government year, Mar. 31 to approve their operating budget and capital plan.
Comments made by both Richardson and first-term Councillor Ray White indicated they felt rushed with the budget process and needed more time to digest the information.
This matter of needing to know more before deciding is not without precedent.
In 2011, Council voted down the first reading of the budget for lack of information. This publication’s archives also show that Council approved interim budgets in 2013 and 2017, both first budgets of then-new councils.
Morinville taxes are high in the eyes and bank balances of its resident, regardless of what metrics are used to compare communities.
A tax increase of nearly 16% on homes and 22% on businesses is too much, regardless of the tight circumstances the Town finds itself.