St. Albert Real Estate Taxes Up 5.09%

The tax increase works out to an extra $118 a year for a typical $400,000 home, after council set the 2009 rate Monday. Non-residential property owners face a 5.84 per cent tax increase.

Mayor Nolan Crouse stressed the city is in good financial shape, but the tax increase was necessary because council wasn’t willing to cut programs.

“We would have to have cut services or staff,” said Crouse. “We weren’t prepared to reduce RCMP or reduce snow removal or reduce various programs.”

The final tax increase is slightly higher than the 4.55 per cent approved during the 2009 budget. Last week council approved several budget changes that added 0.54 percentage points to the municipal increase.

Although municipal property taxes are up 5.09 per cent, homeowners can expect to pay more — a 7.38 per cent average increase — when education taxes are included. The city collects the education levy on behalf of the provincial government, but has no control of the rate. This year the province approved an eight per cent increase to the education rate. St. Albert taxpayers will contribute $23.6 million to the education system, up from $21.8 million last year.

City manager Bill Holtby called the education tax increase an anomaly.
“This is the first increase that there’s been in the education component of the property tax for several years,” said Holtby.

Holtby said the silver lining is that St. Albert’s tax increases are less than other municipalities in the Capital region.

But the complicated part, said Holtby, has to do with changes in property values and how that affects a homeowner’s tax bill. Single-family homes dropped in value by an average 11 per cent compared to the previous tax year. Multi-family homes fell by 7.6 per cent.

Holtby explained the city adjusts its tax rate to compensate for fluctuations in the real estate market. The average tax increase is based on the amount of revenue needed this year to pay for programs in services, in this case $68 million.

The municipal tax increase includes the Servus Credit Union Place capital levy and operating subsidy. This year homeowners are paying $35 per $100,000 of assessment to pay down the $38 million the city borrowed to build Servus Place. The operating subsidy works out to $17.80 per $100,000 of assessment.

Residents can expect a brochure with their tax notice explaining the 2009 property tax rate.

Now that this year’s rates are set, Crouse said his next job would be to plan for the 2010 budget this fall.

“The concern going into the fall is that we are still probably the most taxed municipality in the region. We do not have enough non-residential tax revenues, so my concern is that we’ve got to continue to reinforce with the business community that isn’t in St. Albert to come to St. Albert,” he said.

Crouse said the key for next year will be to improve light industrial and commercial development to offset the tax burden on residents but, the city will also re-evaluate all of its spending.

“We are going to be taking a real tough look at what programs and services we’re providing,” he said.

Tax notices will be issued to residents on May 29, with balances due June 30.

Here’s the link to the original article on the St. Albert Gazette’s website: http://www.stalbertgazette.com/news/2009/0506/top2.htm

This article was originally posted on John Carle of ReMax Real Estate (edmonton) real estate blog at http://www.knock-knock.ca/john_real_estate_blog/