City report recommends Edmonton property tax increase of 7% in 2024

Property owners in Edmonton are facing a steeper tax increase next year than first budgeted after city financial staff in a report Thursday recommended boosting the forecast hike by two per cent to seven per cent.

The City of Edmonton released its fall budget adjustment report, proposing amendments to the capital and operating budgets that include a 7.09 per cent tax increase, 2.13 per cent higher than the 4.96 per cent city council originally approved in December 2022 when it determined its four-year budget.

Stacey Padbury, the city's chief financial officer and deputy city manager of financial and corporate services, told reporters the cost to maintain existing services in 2024 will be an additional $41.2 million and that the proposed tax increase would allow it "to respond to increased cost and reduced revenues so we can continue to deliver on the four-year budget."

"We are all still recovering from the lasting economic effects of the pandemic, the cumulative impacts of higher costs including the rising cost of energy means that it costs more for the city to deliver the same services," Padbury said, referring to increased costs for energy impacting fleets of vehicles as well as heating and powering facilities.

"We've budgeted for cost increases in the four-year cycle, but our utility costs are rising much higher and faster than originally forecast."

Other increased costs have come from growing demand for services because of higher-than-expected population growth. Reduced revenues from transit and Atco gas franchise fees, as well as a higher-than-expected arbitration settlement for Edmonton Police employees, have also impacted the city's bottom line, she said.

"The fall budget adjustment is largely about managing these pressures for the rest of the four-year cycle," Padbury said.

The additional 2.13 per cent, if approved, would mean the average homeowner in Edmonton would pay about an extra $200 in property taxes next year.

City staff is advising against funding many council priorities. An enhanced homeless camp response, climate initiatives, better snow clearing and infrastructure maintenance are already facing being cut.

Mayor Amarjeet Sohi said in a media conference his focus is maintaining key city services while trying to keep any property tax hikes to a minimum.

"My goal will be to find ways (to) reduce that two-per-cent increase to a lower number," Sohi said, adding he knows how "critical" services such as public transit, snow-and-ice removal, policing, firefighting, recreation centres and libraries are to residents. "We're going to work hard to find ways to do that, but I'm also cognizant of the fact that the vast majority of resources are devoted to core services."

The city has already cut the 2023-26 budget by $60 million and is in the process of reallocating $240 million to core services, all efforts councillors will keep in mind once budget discussions among them resume next month.

Already, Coun. Tim Cartmell, who represents residents in pihêsiwin Ward pihêsiwin, says in a blog entry posted Thursday he is "seriously concerned" with the report and that, moving forward, residents can expect to pay more for fewer services. He is calling on the city to introduce a line-by-line budget -- similar to what the provincial and federal governments already do -- and bring in outside experts to help save money.