Cranbrook city council is set to wrestle with inflationary and other fiscal challenges as officials and city staff meet this week for annual budget deliberations.
Administration has set the table for those discussions, as each department has submitted individual budgets for 2023, as well as a five-year budget forecast.
Staff is proposing a 5.84 per cent tax levy increase, which includes last year’s actual levy, new construction/non-market, a general increase, and the annual one per cent dedicated road tax, all of which adds up to $32.8 million.
While inflation affects everyone, it has hit the city particularly hard, according to Mayor Wayne Price.
“Certainly going forward, I think, personally, it’s going to be the most challenging budget that I’ve seen since I’ve been back with the city and that was since 2005,” said Price. “So yes, we definitely have a challenge. I’m comfortable that we will come in at an acceptable rate based on market conditions and financial conditions.
“Our finance team and our department heads have done a remarkable job at trying to eliminate costs and keep costs to a minimum. That being said, what I’ve seen in the past number of years, we have an extremely responsible budgeting process here … there’s really been no fluff in the City of Cranbrook budgets for the last number of years.”
In addition to the proposed 5.84 per cent tax levy increase, city council is also facing major decisions on new requests from various departments, which in and of itself could carry further increases.
Specifically, the local RCMP detachment is requesting an additional two members, a 1.5 permanent watch clerk funded out of 2021 surplus along with one more permanent watch clerk, as well as a $865,000 increase to RCMP building renovations.
Fire and Emergency Services is also requesting an additional two firefighters to augment department staffing.
All the new staff spending requests — if approved by council — would represent a further 3.26 per cent increase.
The new requests will be likely be a central focal point of discussion for everyone, Price said.
“This will be council’s decision, certainly not mine,” said Price. “There’s going to be seven members of council speak to this, department heads, our finance team and CAO [Chief Administrative Officer] will have input into these final decisions that we do make,” Price said.
A one per cent tax levy increase roughly breaks down to $305,000 in spending.
The 2021 tax rate increase was 2.75 per cent. Over the last five years, the highest tax rate increase was in 2019 at 3.97 per cent.
While administration has presented their budgets and the finance department has proposed a 5.84 per cent tax levy increase, everything is subject to change based on decisions made by city council during those discussions over the next few days.
As part of the agenda package, the Cranbrook Chamber of Commerce submitted a request that the city work to keep the tax rate increase at the five-year average of three per cent.
“Chamber members are already incurring higher labour costs, higher borrowing costs and need to avoid larger changes to a Property Tax Bill [sic],” reads a letter submitted to the City of Cranbrook. “Municipalities across the country will be challenged with integrating and planning for inflation into the future budgets.
“Fiscal restraint will need to be incurred by municipalities as the Business community has already exercised restraint moving through the most recent economic turmoil.”
City council and administration will be meeting starting on Jan. 17, starting at 12 p.m. Talks will continue on Jan. 18-19, starting at 3 p.m. Meetings will be livestreamed on the city’s website. The agenda package is also posted online.