In an early look at the upcoming budget season, the Town of Rocky Mountain House may be grappling with at least modest tax or fee increases to balance the budget in 2025.
Town council heard a budget assumption presentation during the Sept. 17 council meeting, which is predicting a 4.2 per cent revenue increase would potentially be required to raise an additional $410,000.
The presentation, delivered by Director of Corporate Services Betty Quinlan, outlined several options for council to consider ahead of budget season.
Among those are increases to property taxes.
A table shows that Rocky Mountain House’s current residential property tax rate of 8.65 per cent is higher than similar-sized communities such as Sylvan Lake, but lower than communities such as Vegreville and St. Paul.
The average 2024 residential property tax rate among 19 similar-sized communities was 7.69 per cent.
However, data shows Rocky’s non-residential property tax rate of 11.69 per cent was slightly lower than the average of 12.78 per cent.
Estimates show a 1 per cent increase in property taxes would generate $97,000 in revenue.
Previous analyses have shown that Rocky offers a relatively high level of services such as recreation and protective services, thus the slightly higher-than-average property tax rate. Documents show any decreases to the property tax rate would require inordinately large tax increases on other sectors to offer the same level of service.
Another option outlined was increases to franchise fees, which is revenue generated from utilities.
Capital transfers were also on the table. Thanks in large part to higher interest revenue, the Town was able to transfer over $2.5 million into reserves, and expects to transfer nearly as much in 2025.
Coun. Dale Shippelt inquired about the possibility of using interest revenue to help balance the budget, to which Quinlan said was an option.
However, Quinlan cautioned that reserve money could be used up quickly, especially if there was an urgent need for infrastructure improvements or repair.
As an example, she mentions the possibility of the Town being forced to replace significant stretches of road, or worse, costly water and sewer lines.
Coun. Len Phillips also poured cold water on relying too heavily on revenue generated from interest.
“My only concern about using interest dollars to balance a budget is that yes, its here today but it may not be here in two years, so it’s a roll of the dice that money’s still going to be there but once it’s in the budget it’s hard to remove,” says Phillips.
Another option before council was an increase in user fees. Estimates shows a 1 per cent increase in user fees would generate around $13,000 in revenue
As another point of caution, Quinlan says directors in several Town departments have been requesting expenditure increases to fund more work, even before budgets have been reviewed for the upcoming year.
Council approved a motion to set aside Nov. 27-28 from 9 a.m. to 4:30 p.m. for budget meetings, presentations and discussions.
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