Projected tax rates in Kananaskis Improvement District’s draft budget might give ratepayers whiplash.
Based on initial debate, the 2024 rate of taxation is forecasted to decrease 6.2 per cent from 2023 largely due to contributions from operating reserves for tax stabilization approved last year and significant increases in assessed property values, but it could come with a sharp double-digit increase in 2025.
“I think most people are OK with some increase,” said KID council chair Melanie Gnyp. “It’s the volatility that drives people nuts. They don’t remember that they got a 6.2 per cent decrease the year before, they’re suddenly going ‘why is it 11 per cent higher this year.’”
Gnyp further suggested administration “smooth out” tax rates before the budget returns for council deliberation next week.
The total operating budget is $2.765 million, which represents a three per cent increase from 2023. The projected tax rate for 2024 is based on the draft operating budget with required tax revenue of $1.424 million and a mill rate of 6.092, compared to $1.528 million in 2023 and a mill rate of 6.4.
In 2025, the forecasted tax requirement jumps to $1.742 million based on a mill rate of 7.42 and an average two per cent increase in property assessments year-over-year.
CAO Kieran Dowling suggested not using an additional $50,000 approved for tax stabilization next year. That money, he added, could be of better use to offset projected increases later.
Anticipated administrative expenses for the upcoming year show a projected 26 per cent increase compared to the 2023 budget.
The surge is primarily due to proposed expenditures in professional services, including a $145,000 increase compared to the approved 2023 budget.
Spending covers contracted services for KID stakeholder engagement planning, accounting costs and property assessment. KID priorities relating to stakeholder engagement and communications plans, an economic impact assessment, traffic impact assessment, and project management for telecommunications and broadband account for $124,000 for contracted services but are conditional on receipt of associated grants or other funding support.
Also included in the budget is $20,000 for a transit feasibility study, which is being jointly pursued with the MD of Bighorn, as well as $10,000 to go towards contracted services for a report on EV charging stations.
About 80 per cent of KID’s operating expenses are allocated to Kananaskis Emergency Services. The capital budget also proposes an increase of $161,038, or 15 per cent, to Kananaskis Emergency Services costs, mainly due to an $85,000 increase in the non-resident firefighter paid on-call program and for fire services salaries and wages to better align with others in the region, including a reclassification of Canada Pension Plan, Workers Compensation Board of Alberta and increases in personal protective equipment requirements for KES fire captains.
KES’ Center of Excellence external training program is expected to generate a revenue of around $40,000, taking into account increased salaries, equipment, and materials.
Council costs are maintained in the budget but an increased allocation from $8,000 in 2023 to $15,135 in 2024 is to support the transition of new staff to council in the new year. KID is awaiting a byelection after former Coun. Anita Szuster resigned at the end of November and the terms of council’s two provincial appointments ended in October.
Total capital budget expenses in 2024 are $1.146 million, with six new projects and five carrying forward from 2023. Among these include $735,968 from grants for a second deposit for KES’ new Quint fire truck, with anticipated delivery of the truck in 2025.
Other large expenditures include a fire protection non-routine maintenance program ($75,000) and a lease-to-own acquisition of a wildland fire bush buggy at a cost of $65,000 per year.
All capital source funding is 40 per cent from the Municipal Sustainability Initiative grant, 40 per cent from the Canada Community-Building Fund, eight per cent from Forest Resource Improvement Association of Alberta for FireSmart vegetation management plans, 10 per cent from reserves and two per cent through additional grants.
Administration recommended council approve an interim budget and prepare a final budget, with discussions expected to pick up again next week, before the end of February 2024, which is typically when KID receives property tax assessments.
“I like the idea of setting an interim budget because I think until we get those final assessment numbers, I’d like to hold off on setting final budget,” said Gnyp.
So far, in 2023, water and sewer utility revenues are $45,903.04 higher than forecasted expenditures. The budget recommends updating the water utility rate in 2024 to allow for a surplus of approximately $9,000, which could be added to the water/wastewater reserve fund, which currently has $76,715 in it, with the upper target for the reserve being $150,000 by December 2026.
Earlier in the evening, KID approved a change to its 2024 water and wastewater utility rates, which were not reflected in the budget and council asked administration to review the changes.
Council voted to keep the base rate of $11.72, but reduce the consumption rates to $0.39 per cubic metre for water and $0.49 per cubic metre for sewer. This would be a $0.20 per cubic metre reduction for water and the same reduction for sewer, resulting in a surplus of $9,683.60.
The water/wastewater fund was originally created by KID Council in response to a significant sewage back-up at Nakiska Lift Station in December 2020, which cost over $123,000.
A three per cent increase in the 2024 tonnage rate is planned as per a contract with GFL Environmental, with combined garbage and recycling expenditures of $422,580 in 2024.
Budget discussions will resume in January.
By Jessica Lee, Local Journalism Initiative Reporter
Original Published on Dec 22, 2023 at 13:34