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Coaldale council passes 2022 operational and capital budgets

Posted on December 29, 2021 by Sunny South News

By Erika Mathieu
Sunny South News

Coaldale town council’s 2022 budget deliberations concluded on Dec. 20 with council passing motions to accept the revised budget for the multi-use rec centre for an all-inclusive total of $15.75 million, as well as to accept the operational budget for 2022. The motions were carried, although Deputy Mayor Jacen Abrey and Coun. Jason Beekman voted against both motions. The final vote during the special council meeting was concerning the revised capital budget. Sponsored by Coun. Chapman, the capital budget was also passed as amended, with opposition by Coun. Pickering, Beekman, and Abrey.

Earlier this month during the Dec. 8 draft capital budget, Coaldale’s Chief Financial Officer Kyle Beauchamp presented the capital budget for 2022 as approximately $17.1 million. Subsequently, on Dec. 15, council heard the draft operating budget total which was estimated at $20.3 million in operational spending for 2022.

During earlier deliberations, the Lagoon upgrades debenture loan has been adjusted from a 15-year term to a 10-year repayment term and will utilize utility rates to fund those payments. Beauchamp spoke to the specific financial impact of this, which he said will result in a $6.97 per month increase to the sewage fee, and will come into effect in January 2022. After one calendar year, an additional $6.97 per month increase will be adopted in January 2023 totalling just under $14 per month in increases by 2023. Beauchamp added there would not be further increases to utility rates. Council will have to pass the utility rate bylaw to formalize the rate adjustment.

Beauchamp said an additional $151,279 in municipal taxes are required to balance the budget as presented to council for 2022 and presented a solution of a 1.72 per cent tax increase to assessed property value. These totals equate to approximately $13.78 on every $100k in residential property value, and $17.25 on every $100k in non-residential property value

Mayor Jack Van Rijn spoke to increases in other municipalities. Lethbridge County recently passed their budget with a 1.626 per cent increase on municipal rates, Cold Lake saw a 3.2 per cent increase, Parkland County is up 2.5 per cent, the Town of Devon passed their budget with a 3.9 per cent increase, while Okotoks and Airdrie saw increases of 2.5 per cent and 4.3 per cent, respectively for 2022.

“A 1.72 per cent increase is below average,” said Van Rijn.

Beauchamp added the municipality did not see any municipal tax rate increases over the past three years.

Beauchamp also compared Coaldale to neighbouring municipalities with respect to franchise fees.

“If we were to have the same franchise fees as Taber, we would have enough revenue where we would be able to look at a tax decrease of 3.5 per cent.”

Coaldale’s franchise fees are 35 per cent lower than those in Taber and 44 per cent lower than the City of Lethbridge’s natural gas franchise fees. These differences ultimately reflect a different way to structure revenue streams for the municipality in addition to the municipal tax rates and utility rates.

Beauchamp said the town’s ability to keep rates from increasing in recent years was a result of careful fiscal planning and has become much more difficult with increasing costs of business. The previous year’s zero per cent net increase to residential taxes, “took a lot of diligence in order to cut spending in order to do that three years in a row.”

He added the town had to navigate the rising cost of business expenses which “compounded and wages increased while our revenue stream did not compound with respect to taxes.” The proposed increase to the municipal tax rate is also needed to help offset the $200k reduction in MSI funding. The reduction of MSI funding is not a product of a province-wide reduction of funding to formerly eligible municipalities, but rather, a unique challenge Coaldale is facing due to its growth rate, which has subsequently impacted the town’s eligibility for the grant. Beauchamp noted, “municipalities similar to us, who are maintaining their MSI funding, (are also) increasing taxes.”

Van Rijn said Coaldale’s growth is something he wants council to “keep up with” and added he is confident administration has brought forward a budget, “as bare-bones as possible.” Adding the $3.8 million in cost overruns from Civic Square, the multi-use recreation centre and high school, and the new sanitary and water to get out to the multi-use recreation centre and are cost overruns which council has no control over at this stage.

Following council’s decision to pass the budget, municipal tax rates will be brought back to council for review in April and May before the tax rates are finalized for the year.

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