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Use of tax stabilization reserve fund questioned

Canmore council is questioning whether or not to use its tax stabilization reserve to keep property taxes at a one per cent increase this year. Administration presented its $39.

Canmore council is questioning whether or not to use its tax stabilization reserve to keep property taxes at a one per cent increase this year.

Administration presented its $39.2 million 2012 operating budget at the end of November with a recommendation to use $300,000 from the reserve and increase taxes by 1.9 per cent.

Mayor Ron Casey questioned using the fund, meant to soften the blow of major property tax increases, without a full understanding of the next five to six years.

While 2012 will see four months of the new Multiplex in operation, regional transit start up and a stand alone fire service, the mayor said beyond that it is still unknown what future budget needs are likely to be.

“It is that financial picture that worries me and when we start to use the tax stabilization fund, that concerns me,” Casey said.

New growth in assessment also contributed to increased costs in the budget this year with $40 million in growth resulting in $138,000 in new revenue into Town coffers.

Casey said the reserve is meant to smooth out tax increases related to projects and services the Town expects to see over the next several years. He questioned whether using funds this year is “before many of those real costs start to hit us”.

“Do we deplete it now or use it over time?” he asked.

By the end of December, the reserve account will have a balance of $1.6 million.

Councillor John Borrowman unsuccessfully tried to remove the $300,000 from reserves from the budget.

“In my opinion, it is a bit early to use that tax stabilization reserve given that the tax increase without that contribution is not extraordinary,” Borrowman said.

However, the mayor put forward a motion that passed unanimously to not use the funds until administration returns with a strategy about how the reserve account is supposed to be used.


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