Duncan city council gave the first three readings to it budget for 2024 that could see a 7.54 per cent tax increase on an average home and business.
Finance director Bernice Crossman said the budget was balanced with a tax increase of 10.55 per cent, but 1.22 per cent of that will be paid for by new construction, and after reviewing the fluctuations in 2024 assessed property values, the tax increase was further reduced to 7.54 per cent for both the average home and business in the city this year.
Crossman also said $225,000 from the city’s police bridging capital fund was used in the budget to smooth the tax increases over the next two years.
“That’s been really helpful,” she said.
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In 2021, the city surpassed the 5,000 population mark and had to start paying 70 per cent of its policing cost, as required by the provincial Policing Act.
But the city anticipated it would have to start paying the policing costs in 2009 and taxes were raised by more than 10 per cent each year in 2009, 2010, and 2011 to cover the associated costs.
However, in 2012, the province determined that the city did not have to pay for policing as they were using the 2011 Census population information that determined the city’s population was actually 4,932.
When the city stopped paying for policing that year, the province refunded $1,351,519 that Duncan had paid from April 1, 2009 to March 31, 2012.
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Following a public notification period, the city council at the time passed a resolution to maintain consistency in tax rates by continuing to charge taxes as if the city were directly paying for police and place the funds raised into the police bridging capital fund, and a portion of the money was used for major capital projects until the city’s population surpassed 5,000.
Over the years, the police fund helped pay for numerous capital projects, including park upgrades, street improvements, and seismic upgrades in city buildings.
It was also decided that money in the police fund would be available to be used as tax stabilization funds to smooth the transition from provincially paid policing to city-paid policing, including the $225,000 that was used this year.
There is currently approximately $120,000 remaining in the police fund.
Mayor Michelle Staples offered thanks to the previous council that made the decision to keep taxing for police in the years following 2012 and using the police fund for other projects.
“Without it, the tax increase would have been enormous this year,” she said.
“It really helps me recognize the importance of thinking ahead long term.”
The final adoption of the budget is set for March 4.