Thanks to more revenue from construction in Kelowna in 2018 than anticipated, city taxpayers will see a slightly smaller than expected increase in property taxes this year.
City council approved the final version of its 2019 budget Monday, a document that now calls for an increase of 4.1 per cent on the municipal portion of annual property tax bills instead of the 4.43 per cent hike included in the provisional budget given preliminary approval in December. The also collects taxes for other governments and agencies on its tax bill and they are not part of the municipal portion. The other bodies include the local school district and provincial agencies.
But the decrease is not as low as it could have been.
The city is using part of the $3.5 million in construction revenue generated last year to increase the controversial “infrastructure levy” it included in this year’s budget to to help pay for future infrastructure needs.
The levy, which is part of the overall 4.1 per cent increase, will now account for 2.27 per cent of the total, up from from 1.95 per cent.
But even with the increase, Mayor Colin Basran said the amount that will be generated is “a drop in the bucket.”
READ MORE: City budget 2019: Kelowna council settles on 4.43% tax hike
The city estimates it will need $477 million over the next 10 years to maintain and add needed infrastructure. But with the levy in place for the next three years, only about 10 per cent of that amount will be raised. City hall hopes to add to it with federal and provincial grants, fundraising and contributions from the private sector.
The city says the levy will fund what it calls a looming infrastructure “deficit.”
The extra money will also help pay for a seventh additional RCMP officer.
In the provisional budget, council approved hiring six more officers this year with the money to pay for them coming from savings the local RCMP detachment says it annually generates from officers being on leave and from infilled budgeted positions. The city has an RCMP force of 122 officers.
Mayor Colin Basan described the 2019 budget as a financial plan that addresses residents top concerns about public safety and social issues.
“I’d call it an advancing community priorities budget,” he said.
In December, after council approved the provisional budget that included the initial infrastructure levy, Basran called the budget “fiscally responsible” not “fiscally conservative.”
At the time, he conceded there will always be those in the community who want to see taxes lowered, but added “that is not the reality in this community.”
This week’s final budget approval came at the same meeting as council announced its top priories for the rest of its four-year term.
The six overriding priorities are community safety, social responsibility, transportation and mobility, vibrant neighbourhoods, economic resiliency and environmental protection. In each area there are a total of 26 issues the city wants to see addressed.
But, as was pointed out, the plan also leaves open the ability for the city to adapt to address emergent issues as well.
Council’s approval of the 2019 budget included a number of last-minute operation and capital additions, such as $180,000 for a mobile RCMP command centre, stabilization work on the Cook Street boat launch, and $300,000 for relocation of equipment to the city’s wastewater treatment plant.
City finance department staff say the municipal taxes on an priced Kelowna home (valued at $684,450) will be $2,072 this year, an increase of $81.49 cent over 2018. The increase includes the infrastructure levy.
In total, the city will collect $142.5 million in property taxes this year, and city manager Doug Gilchrist said that mount accounts for only 25 per cent of the city’s total revenue.
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