The pandemic may have meant Terrace taxpayers were able to dodge an extra tax this year, but that may not be the case for the 2022 budget year.
Budget plans subject to approval by council call for an extra one per cent property tax on top of any regular tax hike each year beginning next year up until 2026.
It means next year’s one per cent extra tax bump will become two per cent in 2023, three per cent in 2024, four per cent in 2025 and five per cent in 2026 to pay for major projects such as rebuilding roads.
For 2022, council’s budget plans call for a 4.52 per cent general tax hike but with the extra one per cent, the total comes to 5.52 per cent.
The extra tax, which is to go into what the city is calling an asset management fund, was to have been introduced this year but council held off, citing opposition raised by taxpayers who said the pandemic was affecting their own finances.
That planned 5.52 per cent increase would work out to an extra $97.59 next year based on the 2021 average assessed $383,306 value of a residential property. For a property assessed a $500,000, the increase would be $127.30 and $152.76 for a $600,000 property.
The above figures do not include amounts for school or hospital taxes or other fees levied by other government agencies.
Based on budget planning documents submitted to council, the extra one per cent next year would raise $158,780 next year, increasing to $799,733 annually when the full five per cent extra tax takes hold in 2026.
Those same documents also indicate there’s already a plan to use the money to rebuild the 4900 Block of Lambly and Keith Ave. from Braun to Frank St. in the industrial area in 2026.
City finance director Lori Greenlaw reinforced the reasons for creating the asset management tax, citing a lengthy list of capital projects amounting to just over $55 million city staffers would like to make happen but for which there is no money.
And in notes for council members to consider, she pointed out that the city is relying on nearly $15 million provided it by the province in 2019 and 2020 to finance capital projects. The money is also being used to pay for emergencies and unforeseen expenses such as repairing the roads up Lanfear Hill and Birch Hill.
The money is “currently being used to fund the majority of our capital requirements until 2024. These are projects that are required to maintain our existing service levels,” Greenlaw wrote.
“There are many items beyond 2024 that will require consideration and funding in future years.”