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Spring 2024 Budget Adjustment

On April 23, City Council will discuss the 2024 spring supplement operating budget adjustment.

Budget Process

The City of Edmonton's budget funds 70 services, including the emergency services, parks, roads, trails, bridges, recreation centres, attractions, social supports, and transit that Edmontonians use every day. It also supports priorities related to community safety and well-being, transportation, affordable housing and homelessness, and energy transition. 

While the City’s budget is developed in 4-year cycles (2023-2026), it is also reviewed and adjusted every spring and fall in response to significant changes so that these 70 programs and service areas can be provided to Edmontonians at the levels they have come to expect, even as our city grows and costs increase due to inflation.

Current Context

Like many households and businesses, the City is facing increased costs on many fronts. We saw that reflected in last fall’s budget update, and we have additional challenges to face now as we make the final updates to the 2024 budget. 

Since Council last discussed the 2024 budget last fall, we have a better understanding of longer-term labour costs, and have encountered higher WCB premiums. Uncertainty associated with fuel, utilities, labour costs, inflationary pressures and interest rates is also adding additional costs, therefore city administration has revised the property tax increase recommendation to 8.7%. This increase is needed in 2024 in order to maintain services, which is 2.1% above what was originally approved by City Council in Fall 2023. 

We anticipated and budgeted for cost increases within our four-year budget, but our actual costs are rising much higher and faster than originally forecast, and we need to respond to that. We have limited resources and we know that many Edmontonians are also stretched thin. City administration is only recommending budget adjustments that are absolutely necessary to deliver the four-year budget.

Provincial Cuts and Downloading

On top of these pressures, provincial funding cuts and continued downloading has added over $70 million in annual costs to the property tax levy. In excess of operational downloading, provincial funding for local infrastructure was cut from about $424 per Albertan in 2011 to about $154 per Albertan today — all while demands for municipal infrastructure continue to grow.

Furthermore, municipal property taxes are not designed to pay for emergency medical services (EMS), but due to downloading of this service by the provincial government, the City of Edmonton property-tax supported budget has had to cover over $28 million in increased Edmonton Fire Rescue Service calls to medical events.

Provincial disparities in funding continue to place stress on Edmonton’s budget. The decision by the Provincial government to reduce their property tax payments to the City of Edmonton by half has cost Edmontonians $60 million ($14 million annually). Provincial support for maintaining Deerfoot Trail in Calgary, while neglecting Yellowhead Trail and Whitemud Drive, results in a $17 million annual disparity.

Finding Savings & Sustaining Services

Over the past decade, the City has worked hard to find efficiencies and savings to keep taxes manageable without significantly impacting services. Since 2015, these efforts have resulted in a cumulative savings of $1.9 billion and a 21.5% reduction in our required tax increases.

The average tax increase in the last decade (2014-2023) was 3.3%. During the pandemic, the City kept tax increases below inflation, including no increase in 2021 and a 1.9% increase in 2022, which was the lowest increase among major cities in Canada.

Taxes were kept low and were not enough to cover inflationary pressures from a growing population. These artificially low tax increases were necessary, but they aren’t sustainable. At best, they were tax deferrals, and the bill is coming due. 

The Pressures of Growth

Approximately 1,300 people moved to Edmonton every week in 2023, and our population is forecast to grow by 4.4% in 2024. Edmonton's population is growing rapidly.

That means we will have even greater demands on our programs, services, and infrastructure. As we prepare for growth and continue stabilizing from the pandemic, we must also continue course correcting our patterns of development to ensure they are supporting fiscal resilience. I won't go into detail in about this topic as I have written about the city's infrastructure deficit and the costs of sprawl here.

In order to maintain a strong financial position, we need to make decisions about how to deal with several new cost pressures; to make choices between funding these pressures through increased property taxes or by reducing services to keep taxes lower. These are the conversations City Council will be having as part of the budget adjustment process, and as part of our long-range planning.

A Path Forward

Conscious decisions to blunt the pain of the pandemic and inflation crisis have served their purpose, but come at a cost. The added tax pressure born by Edmontonians as a result of provincial downloading and cuts has come at an inopportune moment as we look to stabilize, recover, and grow as a community.

Periods of significant financial challenges have driven municipal tax rates up before, but the City of Edmonton is resilient and despite the challenging macroeconomic conditions, we are in a stable financial position. We have strong financial policies and practices, and a well-defined budget and financial reporting process that ensures transparency and accountability.

I look forward to working alongside administration and my Council colleagues to strike the right balance of keeping taxes manageable and delivering the services and projects that make Edmonton a great place to live, work, and play for years to come.



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