St. Albert Property Tax Caps in Election 2010: Fact versus Fiction

St. Albert residents will elect a new City Council on Oct. 18.

I attended the St. Albert Taxpayers forum at the Arden theatre on Sept. 28.  A member of the audience asked the Council candidates to indicate whether they would support holding property tax increases to a 1.5 percent level for each of the next 2 years.

Quite surprisingly some of the Council candidates raised their hand and agreed to support this proposition. 

Obviously capping property taxes at a low level while continuing to provide the same quality and quantity of services per capita to a population in a growing municipality is something the overwhelming majority of the St. Albert population would heartily endorse.

On the other hand candidates recommending a property tax cap that is not based on a well thought out and researched budget plan deserve to be severely censored by the St. Albert electorate when election day rolls around.

Will a 1.5 percent property tax increase in 2011 and 2012  result in significant cuts to existing City programs and services?  If so which ones and by how much?  Will capital projects have to be postponed?  Will wage freezes and/or lay-offs in the municipal civil service be necessary in order to hold spending down?  Will a host of City fees and charges be boosted to try and cover some of the revenue shortfalls?

No one can provide answers to these questions at this time.  The reason is the 2011 city budget will not be tabled until well after the election and the new Council is sworn in.

Specific Details Regarding Taxes and Expenditures Are Determined at Budget Time

 The basis for determining why certain City programs should be continued and expanded and others discontinued or reduced or new ones created are best made at budget time when all of the information needed to make such decisions is made available to both Council and the general public.

At budget time the professional staff  responsible for managing and administering the City’s affairs present a budget they believe will best serve the interest in the public corporation called the City of St. Albert. The tabling of this budget is the starting point for informed budget deliberations that focus on both the revenue as well as the expenditures needed to run the municipality.

At the end of the budgetary process City Council may have increased, markedly reduced or left the budget mostly unchanged.  The point to note is any changes made to the original budget are based on the input of its staff, all of the members of council and members of the public who care to make representations at various points in the budget deliberations.

The final budget is a document that carefully weighs the needs of a city against the revenues required to run it.  Thousands of hours of work and effort is required to prepare and finalize it.

Conclusion:

Some of the first time members running for council made a serious economic policy mistake in supporting a 1.5 percent tax cap for each of the next two years.  There is simply no rational economic basis for making such a commitment at this point in time.

A statement made in the heat of the moment at an election forum in the first week of a campaign by a person engaged in their first political campaign is one thing.  Adherence to a bad policy throughout a campaign is another.

Some of the candidates who supported the 1.5 percent tax cap have excellent credentials. The City needs members on Council who will carefully scrutinize public spending and work hard to minimize the magnitude of the taxes levied on property owners.

I am going to monitor the progress of the tax cappers over the course of the next two weeks to see if the pro cap group realize they can’t finalize their position on property taxes for 2011 without  first examining the budget and weighing the needs of the city against all of the revenues needed to fund it.