Qualicum Beach council wants to explore all options that may help reduce a projected property tax increase of 9.6 per cent, to 6.6 per cent, for 2025.
The 2025-2029 financial plan was deliberated by council at its regular meeting on Dec. 11. Director of finance Raj Hayre said they needed the direction of council on the preparation of the five-year financial plan bylaw which will be presented at the Jan. 22 council meeting for first and second readings.
To address the financial pressures the town will face next year, Hayre recommended $1,174,000 of additional property taxation revenue in 2025. That equates to a 9.6 per cent tax hike from 2024 and would result in an average home valued at $995,000 see its property tax go up by $19 every month, or $222 annually.
Hayre presented council with alternatives that may reduce the required tax increase. It includes cutting the strategic initiatives reserve contribution from $250,000 to $125,000, bringing down the tax hike by one percent. Although it would not affect the strategic initiatives next year, Hayre indicated the tax pressure would be deferred to 2026 if council decides to bring back the contribution.
"If it's not reinstated, then the outer initiatives would have to be looked at really carefully and reduced substantially in next year's strategic planning that is approved by council," said Hayre. "It's the outer years that we would have to look at."
Council could also consider service reduction which will impact existing levels of services for departments. The would mean work plans would have to be adjusted, said Hayre, who added, "depending on the depth of the reductions, the town may only have limited opportunity for tax cuts to be achievable in 2025."
Another option given to council is removing the requirement for a 0.8 full-time employee for new services, which would lessen the tax hike by 0.5 per cent or $80,000. Hayre said, however, this would result in declining request for increase in services in the coming year.
It was also suggested the bylaw compliance position be converted to term position using accumulated surplus until a service analysis is undertaken in 2025. This would reduce the tax by 0.8 per cent or $101,000.
Council unanimously voted to focus on lowering the tax increase from 9.6 per cent 6.6 per cent. Hayre pointed out staff will work collaboratively and carefully evaluate the required service reductions, options and their potential impacts.
Mayor Teunis Westbroek is hoping when council meets again on Jan. 8, staff will be able to provide different options for them to consider a 6.6 per cent tax hike.
"What projects are we referring to that will not be maintained as best as we could." said Westbroek. "I think today is really about setting general direction. And if after the Jan. 8 meeting, both council and staff and the public realizes that is not a good direction to go then we can make that adjustment."
Westbroek acknowledges the difficulty a lot of people is experiencing in dealing with tax increases. He cited the tough situation at the Regional District of Nanaimo, where the board recently spent more than nine hours deliberating on finding cost-saving options to reduce the taxes for next year.
"I am OK with the 6.6 per cent at this point but when we get more information we always need to be having an open mind," said Westbroek. "If it requires that we need to adjust that, either next year and catch up, which can happen, because we won't have the same pressures on the same areas as we do this year. But we need to be practical and also realistic."
