As municipal leaders and administrators across Lakeland communities prepare annual taxation bylaws, perhaps now is the time to raise the rates.
The struggle to offset community wants and needs with growing economic challenges and increased costs is an annual tug-of-war in all municipal offices. Raising taxes or cutting services. Raising taxes or releasing staff. Raising taxes or no new projects. Raising taxes and upsetting the residents ...
While taxes may be one of the three certainties of life, raising them doesn't have to be, many will say. But as inflation rates, interest charges, fuel, and the cost of grocery store watermelons continue to surge ... what's one more increase going to hurt? And at least this one helps bring more to our communities, our neighbourhoods and our homes, rather than taking away.
Over the last six months, due to circumstances mainly beyond the control of anyone living in northeastern Alberta, the cost for an average tank of motor fuel has increased by more than 40 per cent. The cost of most retail products — again due to outside-our-control influences like production shortages, raw material collection and distribution — have seen marked increases. From cans of soup to Subaru Foresters, consumers have faced supply shortages and price hikes. And what do those consumers get out of it? Less money in their pockets, and less opportunity to provide for their families.
So why encourage a municipal tax hike? Well, at least the money will have a chance to come back around. No disrespect to the hard-working retailers or service providers ... they have had to raise their prices to match increasing costs. They're simply passing those elevating costs onto their consumers. But those consumers don't see more value by spending more. They just have to decide if they want to continue to pay more this week for a pair of pants, a loaf of bread, a steak sandwich, a tank of gas or a beer.
A municipal tax increase on all residential properties throughout a community — would generate millions collectively in new spending money for our Lakeland communities. A significant increase would help to upgrade aging infrastructure that all residents use, or create more recreation opportunities for young families and seniors.
Each year, municipal officials hem and haw over slight changes to tax lines. Tiny single digit increases or adjustments are weighed against the financial tolerance of the voters. Well this year, that tolerance (like weekly spending) has grown. Forget big drama over a three per cent tax increase, this is the time to go big. How about a 10 per cent residential tax hike? Twenty per cent? According to tax bylaws from communities across the Lakeland, the County of St. Paul brought in $3.77 million last year in residential tax payments with a municipal mill rate of 4.3 based on $877 million of assessed residential property. An average homeowner was paying around $2,800 a year in municipal taxes. Why not put the mill rate to 5 ... or 6? An extra cost of $280 per year ... $560 if it went up 20 per cent? For less than an additional $50 a month, homeowners in this one municipality alone could add to their community coffers by $700,000. Similar double-digit municipal tax rate increases in Lac La Biche County would add a similar amount of additional community funding. A 20 per cent increase in the mill rate in the MD of Bonnyville would generate almost a million in extra revenue, while costing the average ratepayer an additional $40 per month.
When you're paying an extra $60 a month to fill up the over-priced vehicle you just bought with a bank loan that now has a 30-year high interest rate, what's a few dollars more to fill some potholes and gaps in community programming that will benefit many?
But will local councillors see it the same way? While death and taxes are the standard first two certainties in life, in this instance, the fortitude of an elected official to make a tough decision that voters may not like is not so certain.
Tax notices in most local municipalities start to go out in May.