Kimberley City Council voted earlier this month to cancel the implementation of the Water and Sewer Parcel Tax in 2015.
Last spring, while preparing the 2015 Financial Plan, Mayor and Council of the day approved a ten year, water, sewer infrastructure and fleet plan. The plan indicated a need to increase funding of water infrastructure by $369,491 and sewer infrastructure by $118,890 in 2015 with a 3.5 per cent inflationary factor going forward. This would leave the City in a position to have the one third of funds required for federal/provincial infrastructure grants ready if a grant was received.
In order to begin to put away funds for water and sewer infrastructure Council proposed a new parcel tax to begin in 2015. This included a parcel tax of $81.40 for water and $26.19 for sewer.
Mayor Don McCormick said that present Council made the decision to cancel the parcel tax after beginning the budget process.
“It is a flat tax and there is some pressure already to look at the existing flat tax.”
McCormick said that if you look at potential mill rate increases plus this parcel tax it adds up to about 10.5 per cent in tax increases.
“That’s too high and that’s not going to happen,” he said.
“The reality is it took us 70 years to dig the hole we’re in and we’re not going to dig out in a five years. To put an inordinate burden on a single year just doesn’t make sense.”
At a preliminary budget meeting this week, Council and the Chief Financial Officer adjusted the financial plan’s capital budget to reflect the changes in funding availability.
CFO Holly Ronnquist told Council that when the parcel tax was approved last year, staff used caution in using those monies, knowing things could change.
“Out of the entire 2015 plan we just need to change a few things,” she said.
At that same meeting, Council agreed that rather than a parcel tax, they would look at funding utilities with utilities.
“Our general thinking is that utility rates themselves need to fund it. They’ve been underfunded for years,” McCormick said. “If you look at comparisons with other communities our utility costs have always been low. We’ve been getting along but not setting aside any reserves for future reinvestment.”
McCormick says that increases to utility costs will be phased in over three years, working out to an $84 per year increase, rather than the $107 parcel tax.