BANFF – The Town of Banff will collect $20.2 million in municipal taxes this year – up four per cent from last year but down two per cent from 2019 prior to the COVID-19 pandemic.
After 12 days of debate and discussion that began Nov. 29, Banff town council has voted 4-2 to approve the 2022-24 operating budget and 10-year capital plan, which has $21 million worth of projects this year including reconstruction of St.-Julien Road and construction of an all-season, multi-purpose pavilion as part of ongoing redevelopment of the recreation grounds.
“The vision for your town is truly found in your budget because you’re putting your money where your mouth is,” said Mayor Corrie DiManno during the final budget meeting on Wednesday (Jan. 26).
“I think the story of this budget is one of an environmentally-focused community, trying to do our part on climate action, getting people onto transit, helping our community recover economically, and building relationships with our Indigenous neighbours.”
The average Banff residential dwelling assessed at $461,100 will see a monthly increase of $16 for a total monthly tax bill of about $91 per month – or $1,095 a year. The education property tax will be added to this municipal portion on the final tax bill in May.
Councillors Ted Christensen and Hugh Pettigrew did not support the operating budget, with both arguing not enough had been done to cut spending as residents still struggle financially from the fallout of the COVID-19 pandemic. Coun. Kaylee Ram was absent from the meeting.
"I don't believe we’ve done enough to cut the costs in this time," said Coun. Ted Christensen.
Throughout the budget process, Coun. Pettigrew was unsuccessful in his attempts to try to convince council to use all or part of the projected 2022 visitor paid parking profits of $1.6 million to help lower taxes for residents.
“I feel very strongly that our budget is based on a plan that was not prepared by this new council,” said Coun. Pettigrew, referring to the strategic plan approved by the former council.
“We have not provided any significant cuts or adjustments to the budget … I feel like I am forced into a fence.”
As part of the budget, Town of Banff staff get a 1.6 per cent wage increase. The Town's total budget – which is also funded by fees and federal and provincial grants on top of municipal taxes – is about $50 million.
The 2022 budget also includes almost $700,000 in tax-supported spending for new and previously approved projects, such as a National Indigenous Day event, creation of an Indigenous framework, the train station skating rink, waste diversion tactics, and increased transit frequency on local bus routes.
In addition, there is approximately $1.7 million worth of new programs and services not funded by taxes that comes out of different operating reserves, such as visitor paid parking, which is projected to generate $1.6 million in net revenue this year.
Projects funded by profits from visitor paid parking include free transit on Banff local routes for residents, increased winter transit service, a new e-bike rebate program, and improved snow and ice control at intersections.
The environmental reserve, which is funded by Fortis franchise fees, will fund projects such as a new staff position – a municipal energy coordinator to get to work on vital climate change initiatives – a climate action campaign and a push to motivate more visitors to take transit.
As part of budget deliberations, the Banff Avenue pedestrian zone also got the final go-ahead to move forward this summer, with an additional $220,000 coming from the municipality’s economic recovery reserve.
Coun. Grant Canning said he was pleased council could tap into the many non-taxpayer operating reserves to fund new initiatives, particularly visitor paid parking.
“I am proud of the things that we are adding, particularly around the idea of providing free local transit,” he said.
“That is a huge quality-of-life improvement for many of our residents that is being paid by visitors through visitor paid parking… those do not go onto our taxes.”
Banff’s 2022 capital budget includes $21 million worth of projects, which is about 16.5 per cent lower than last year’s capital expenditures. The balance at the end of the 10-year capital plan is expected to be $50 million in 2031.
Some of this year’s projects include St.-Julien Road, which has been on the capital books for 15 years, expansion of the solar energy array on the Fenlands recreation centre, pre-design work on a new Cave Avenue below-market rental apartment building, more neighbourhood recycling and organics bins, completion of the new pedestrian bridge across the Bow River, studies to look at adding a transit-only lane on a portion of Mountain Avenue and Spray Avenue.
The work at the Banff recreation grounds will include new horse trails, trails connecting to the new pedestrian bridge currently under construction and the start of construction of a multi-purpose year-round pavilion.
Pre-COVID-19 pandemic, council typically transferred about $4.5 million each year to capital reserves – the municipality’s savings account to build funds for future projects and to be able to maintain existing infrastructure. This year, the transfer was held at $3.1 million.
“Previous councils, to help balance the budget, have tapped into that significantly to lower the tax burden and I believe that was the right decision,” said Coun. Canning in reference to the lower contributions during 2020 and 2021 tied to tax relief during the first two years of the pandemic.
“However, that’s not sustainable. You can’t keep doing it and eventually that is going to have to be paid back."
The total tax levy required to fund services and programs this year increased 1.6 per cent due to inflation of costs on current services and 2.43 per cent due to returning to pre-pandemic service levels and new services for a total 4.03 per cent increase on the total tax levy.
The COVID-19 pandemic has led to decreases in the value of commercial properties in Banff, particularly hotels, which are assessed based on income. With the pandemic, hotels were virtually empty at the start of the pandemic. Residential properties, on the other hand, either held or increased in value.
This is leading to a significant shift in the tax burden between the residential and non-residential sectors, but there is now a provincial cap on the mill rate split which limits how much Alberta municipalities can increase the commercial share of property taxes.
Based on current projections, residential property owners will see a 20 per cent increase over 2021 tax bills, but a three per cent decrease over 2019 before the COVID-19 pandemic began. For hotels, it’s a nine per cent decrease from 2021 and a 13 per cent decrease from 2019.
Properties in the industrial compound and downtown businesses such as retail and restaurants would see a significant increase.
Coun. Pettigrew was deeply concerned about this, questioning if more investigation could be done to see if the Town of Banff had to abide by the provincial mill rate cap yet.
He wanted to see more cuts in spending and hopes the budget can be amended later in spring before the tax rate bylaw is passed.
“I just don’t see how I can support this budget with the numbers in front of us because with my philosophy we’re not yet back to 2019,” he said.
Coun. Barb Pelham, on the other hand, indicated council went through a rigorous process.
“We have given it our very best shot for our community. We have tried really hard. It may not be perfect, but I think it’s as good as we can hope.”
Coun. Chip Olver said council can't continue to cut services similar to what happened in 2020 and 2021.
She said staff positions were cut in places like the Fenlands and commercial waste collection because less service was being provided.
"That can't continue in 2022. We will see increased visitation this year, and we have to have the services for those visitors and we’re able to now because social distancing requirements and health orders are different than they were before," said Coun. Olver.
"We're able to have the Fenlands open and to offer some services there, so I can't compare to 2020 and 2021 where we did exceptions – one-time, can’t-be-repeated things to reduce the budget because the circumstances don't exist anymore. I have to compare to 2019."
