Mayor Naheed Nenshi wrote about Calgary property taxes on his blog Saturday.
Ald. Chabot and Demong say Mayor Naheed Nenshi is misleading Calgary voters
The Naheed Nenshi “smoke and mirrors” act on Calgary property taxes is being panned by fellow councillors who say the mayor is not being completely honest with Calgarians about the extent of property tax hikes over the last three years.
A recent post on Nenshi’s campaign website attempts to break down recent tax increases, suggesting that Calgary property tax increases have only gone up by 4.4 per cent in 2011, six per cent in 2012 and 5.5 per cent in 2013.
But the actual municipal portion of the property tax has gone up 10.4 per cent in 2011, 5.1 per cent in 2012 and 13 per cent in 2013, according to numbers provided by the City. Nenshi’s numbers are a product of the combined municipal and provincial rate, after the province returned a portion of the education property tax. And since the city kept the provincial refunds, taxpayers are still on the hook for it.
Ward 10 Ald. Andre Chabot. Photo: Handout.
Ald. Andre Chabot says the city prepares their budget in November based on their anticipated needs and an estimate of what the province will take for their portion. Simply pocketing the money that is returned by the province and suggesting that city taxpayers aren’t responsible for it is not fair.
“That’s such a smoke and mirrors game,” Chabot said. “When we talk to taxpayers and say, ‘this is only going to affect you by this much per month’, typically we’re only referring to the municipal portion. We’re not referring to the consolidated total.”
But Chabot says Calgarians shouldn’t take anybody’s word for it. They should look at their property tax bills themselves. He says over the last three years, his own municipal property tax rate has gone up 26.8 per cent while the province’s rate has decreased slightly.
“That means somebody else out there had to pay 40 [per cent] to make up for my less than 33 [per cent],” Chabot said.
Naheed Nenshi has also suggested that of all the property taxes Calgarians pay, 47 per cent goes to the province for education taxes and 53 per cent goes to the city’s operating budget. Chabot says that number is off because the city has been increasing their tax rates much higher than the province’s increases.
“I’m not sure where he got that number, but I can tell you that on my property tax bill, 60 per cent of my taxes go to the city, 40 per cent goes to the province,” Chabot said. “And the reason it’s 60-40 isn’t because the province is forgoing money, it’s because we keep increasing our amount disproportionate to what the province increases theirs by.”
Ward 14 Ald. Peter Demong.
Ald. Peter Demong says that’s because many on the current council have demonstrated a lack of fiscal restraint. Pocketing the provincial portion for use on projects determined after the budget has helped cause the double-digit tax increases.
“Of course they’re going up too much,” Demong said. “That’s why I’ve been taking the stance I’ve been taking for the last three years. There’s no question they’ve been going up by double digit numbers.
“The fact of the matter is the city is receiving 30 per cent more in taxes from taxpayers than they did three years ago.”
Using the so-called “tax room” – money vacated by the province to the city – is bad policy, Demong added.
“It’s the wrong process,” he said. “Just because the province decides to leave the tax-room on the table, does not mean we should be stepping in to take it.
“We’re taking money and saying ‘don’t worry, we will find a good use for these funds.’ There’s no identified location to be spending this money on, there’s no identified need.”
As outlined by Naheed Nenshi, the returned provincial portion of property tax since 2011 – over $100 million – has been used for new projects including the new central library, new recreation centres across the city, sidewalks, maintenance on city parks and pools and on maintenance of city buildings and community facilities. And the controversial $52 million “tax room” this year will be used to assist with flood-related expenses. All are projects that were funded after the budgets were determined in the fall.
Both Chabot and Demong say that money should have been returned to citizens or at least a portion of it.
“There has to be more fiscal restraint and accountability [on council],” Demong said.
Chabot also took issue with the claim by Naheed Nenshi that council was able to reduce the overall operating budget by $108 million through department efficiencies. While that number is accurate, Chabot says, it was only a reduction in increases.
“We’ve reduced the increase by $108 million is more in line with what the facts are,” he said. “We’ve still increased our operational budget year over year. It’s just that previous council set some very high expectations in regards to service. We reduced those increases to the tune of $108 million over three years, but meanwhile operating dollars have gone up over $100 million a year every year since.”
Calgary Election 2013 – Ward 4 Ald. Gael Macleod. Photo: Facebook.
Ald. Gael MacLeod, a councillor more likely to vote in favour of tax increases according to her record, says the city is making up for minimal tax increases over the last decade and has priorities set for essential services like fire and police budgets.
“Eventually that catches up with you…sure you can put off maintenance until next year,” she said. “We’re facing some of those kinds of challenges as well.”
She says Calgary property tax hikes are needed to help maintain city services and build for the future.
“It’s what do you want for services and how much is that going to cost?” she said. “It’s not money for the sake of money, it’s about what you do with the money that’s important. You need a strategy on what kind of city you want and then you start making the choices.”
Mayoral challenger and former alderman Jon Lord says those choices are not being prioritized at City Hall these days.
Jon Lord is a former Calgary alderman, Progressive Conservative MLA, and is running for the Conservative nomination in Calgary Centre.
“City Hall spending has almost tripled in a few short years and during Nenshi’s time it has risen substantially as well,” he said.
“There’s no ifs, ands or buts – he can’t duck it. He can’t pretend that it’s only costing a couple cups of coffee a month. It’s out of control City spending which is driving these costs.”
Lord says the mayor’s explanation of Calgary property tax increases is misleading at best.
“It makes it look like it’s very small,” he said. “But either the mayor doesn’t know that our taxes are near the highest in Canada and doesn’t know that [a lot] of taxes have been passed on to the business sector, or he does know and he’s being deliberately misleading to the citizens of Calgary. He must think they’re dumb.”
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