Photo: Mayor Jeff Mulligan
By Katie Ryan
Homeowners will be receiving their tax notices much earlier this year, now that the city has approved the 2010 budget.
While the municipal mill rate has increased from 3.38 to 3.52 mills, taxpayers shouldn’t expect too many changes when they receive their notices in late May.
“I think there will be some impact, although in some cases the actual property taxes on a resident may decrease,” said director of finance, Don Newlin, following Monday’s city council meeting.
The higher mill rate will generate $500,000 in additional revenue – 3.6 per cent – to offset the drop in assessment values.
“Part of that makes up a two per cent reduction in the property assessment because market values fell on certain properties over the past year. The balance will go to providing increased services in RCMP policing, road maintenance and a number of city operations,” said Newlin.
According to Mayor Jeff Mulligan, the additional funds generated by the higher mill rate are needed to maintain status quo delivery of service.
“To get the same amount of money as we got we had last year just to run at the same level we would have to increase the mill rate by two per cent, so when you look at it overall it’s really less than a two per cent increase and we need to step up to deliver better service,” said Mulligan.
Individual homes decreased in value by five to 15 per cent on average, while commercial and industrial improved properties showed an increase in value of six to nine per cent. Real assessment growth from properties constructed in 2009 is estimated at 1.5 per cent.
The budget reveals the city will generate an estimated $63 million in revenue, with approximately $53 million in expenditures and a projected $9.9 million surplus, before capital expenditures.
The city’s surplus though isn’t ‘free money,’ each dollar of the $9.9 million sum is already designated for projects according to Mulligan.
“I think there is a lot of misunderstanding, people see a big number and say well the city has lots of money. Well, the city has a capital base, it’s about 10 per cent of our total assets,” said the mayor.
“When you look at any company when you have 10 per cent of your assets in reserves or retained earnings that would be not an unreasonable amount, it would be an expected amount from a statutory perspective in any other business, so all of that money is earmarked for future projects. We are really saving so we can go and pay for future events.”
City officials approved the 2010 capital budget as well, totalling almost $51 million, including carry-over projects, subject to financing being in place for each project prior to tender award, construction or purchase.
New projects
When it comes to major capital projects, the city has a lengthy ‘to do list’ to tackle. On the list of projects for 2010, parking and entrance improvements at the Common Wealth Centre and the construction of the new skate park are included.
Before work begins on any capital project, the city will ensure the funds are in place before the shovels hit the ground.
“These are all exciting capital projects and as we have said the caveat is they had to be funded and paid for, so either by grants or we had to have the funding in place to do them. As you know, when we do a large capital project it doesn’t affect this year’s budget, it’s just the advertised portion that affects this year’s budget. There are some exciting projects,” said Mayor Jeff Mulligan.
“We have the Bud Miller All Seasons Park work, we have a number of projects that have to be started and have to be done, together with major road work of course.”
A new police station is also in the works, continuing from last year. Mulligan said in his first act as the newly elected mayor he visited Fort McMurray’s RCMP detachment office.
“If you take their detachment office, which has about 320 people working in it, about 180 or so officers, if you just washed it on hot and shrunk it down, you’ll get the kind of facility we are going to have,” he said, adding the new station will combine community services with the facility and will be built in a cost effective fashion. “Much lower per square foot charge than anything I have ever seen using the same architect, under the watchful eye of Tom Lysyk and our team, we will be starting that project on the design.”
Instead of reporting to duty at the current 4201-47 Avenue location, in the future RCMP will operate adjacent to city hall in central park, sharing infrastructure and services.
“If you ask the RCMP, it’s a perfect location in terms of access and egress. We’ll have to make some provisions to Highway 16 for them in terms of getting out, but overall it’s a tremendous location for them and it has some legal reasons as well,” said Mulligan.
Capital expenditures
City officials approved the 2010 capital budget, totalling approximately $51 million. Of that total figure, Engineering and Corporation capital expenditures, including carry-over projects total $15.3 million for 2010, Utilities and Environment $19.2 million, Parks and Recreation almost $5 million and Fire, Police, Corporate Affairs and Finance, $11.4 million
Rising utility rates
While tax notices might fluctuate for some property owners, every homeowner in the Border City will be faced with rising utility rates. City council approved new water and sewer utilities rates that will increase incrementally over a three–year plan.
Homeowners, though, won’t have to dig deep into their pockets to cover the cost according to the city’s director of planning and public works Adam Homes.
“The average homeowner will see their bills go up just under $4 a month, basically,” he said.
Monthly increases for the average residential user (17.8 cubic meters) will be: 10 per cent, 14.7 per cent and 12.9 per cent for 2010, 2011 and 2012.
Monthly increases for the average commercial user (142.2 cubic meters) will be: 5.9 per cent, 5.5 per cent and 12.2 per cent for 2010, 2011 and 2012.
“These services – utilities – are costing us money to provide and we need to keep up with the cost. You don’t want to get yourself behind the eight ball, so Lloydminster has always been very progressive when it comes to water and utility services,” said city councillor, Rob Saunders.
The first year rate increase will come into effect July 1, 2010, with subsequent years requiring council approval. The proposed plan is to move from the existing seven tier rate plan to a five tier rate plan in 2010 and a four tier rate plan for 2011 and 2012.
Homes said the rate at which water and sewer rates will increase were determined by how the city will condense the current seven tier plan. Another rate plan that other urban centres charge homeowners by is according to a fixed rate (one per cubic metre rate).
“For us to change to that type of rate structure, it would be very difficult one year. People would see rate increases of 60, 70 per cent, so that was out of the question. That is why we settled on this,” said Homes.
The additional revenue generated will help pay for the $120 million worth of upgrades outlined in the water and sewer sanitary master plans that will be addressed over the next 15 years.
“That’s over and above the actual repairing of the cast iron pipes that have been in the ground for over 40 years. We have fairly intensive infrastructure needs in the next few years and these rates will help pay for that,” added Homes.
Even with the increased rates, compared to 16 other major centres in Alberta and Saskatchewan such as Red Deer and Saskatoon, Lloydminster will maintain competitive water and sewer rates.
Major upgrades needed over the next five years include Sewage Treatment Plant Headworks and Water Treatment Plant expansion, and West Sanitary Trunk construction.