Substantial changes could be coming to the City of Terrace’s proposed 2020 budget when council meets at noon April 23 to craft a final document.
A provisional budget, released in December, called for a 7.4 percent property tax increase, but that was before the COVID-19 pandemic shut down many businesses and left some residents at home without steady income.
A petition calling on the City to halt the property tax increase due to the impacts of COVID-19 has earned 336 signatures so far.
The provincial government unveiled on April 16 a slate of unprecedented financial measures available to help municipalities through the pandemic.
B.C. municipalities are now allowed to run a budget deficit for one year, can also borrow from their own capital funds, money which is intended for projects such as sewer upgrades or road work, and use it to cover operating costs such as employee salaries.
It’s not yet clear which of these measures the City of Terrace will utilize, if any, but those answers will come at the upcoming meeting, according to Lori Greenlaw, the city’s finance director.
“The new measures announced … are invaluable for many communities, including ours,” she said in an email statement this week. “We will be sharing on Thursday how they can help us provide additional relief to taxpayers in Terrace.”
City Hall is closed to the public due to COVID-19, but the meeting will be livestreamed on Facebook and the City’s website at 12 p.m. April 23 for anyone who wishes to attend.
City staff have been reviewing the budget in response to the pandemic, Greenlaw said, now the final budget decisions rest with city council.
“Council has a lot to consider given the global changes that have occurred since we first announced our budget 2020 plans last December,” she said.
Mayor Carol Leclerc previously told The Terrace Standard that the city is facing substantial revenue loss this year due to the pandemic, such as a portion of the approximately $700,000 a year that is collected by the province from the Chances Terrace casino and then returned to the city.
With Chances Terrace now closed, that revenue loss means it’s unlikely the property tax increase could be reduced or stopped, Leclerc said.
The City is also losing out on revenue from its recreational facilities but is balancing that with layoffs.
Leclerc said one way the city is reducing costs this year is by cancelling trips that councillors normally take each year to various conferences. The city might also try to defer some infrastructure projects until COVID-19 has passed.
One measure announced by the province last week is a reduction by 25 per cent of the school property tax rate for commercial properties.
Additionally the province has pushed back to the end of the year the requirement of municipalities to send it school tax revenues it collects on its behalf.
That’s to help municipalities facing cash flow issues.
Christina Losier, who organized the petition on change.org asking council to halt its planned tax increase, said she originally supported the hike but changed her opinion when the COVID-19 pandemic was declared.
“I’m thinking of the folks in Terrace who have lost their incomes, who have mouths to feed,” she said. “Post-COVID-19, the economic climate for our community is entirely different and the City of Terrace needs to respond to its citizens by making extremely frugal choices.”
Approximately one-third of the proposed tax increase is to meet inflationary demands with other expenditures meant to bolster the city’s bylaw enforcement function and to hire two more firefighters as well as support staff within the city’s development services section.