City council will debate Monday how to spend $50 million of tax revenue the province is leaving on the table.
I vote for two more Calavatra pedestrian bridges.
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EDIT: Quoting Bunk below, he explained it much better than the Herald did!
Quote:
Originally Posted by Bunk
Keep in mind this money is $52.1 million annually. So, it's $1 billion over 20 years.
In the past, when the Province vacated "tax room" and the City has taken it and used if for capital projects. The first big tranche was a couple years ago - $42 million annually for the Community Investment Fund - which is funding the 4 new rec centres and a big chunk of the Central Library. Last year there was $10.2m in tax room that was dedicated to a bunch of little things like eliminating the resident portion of City-initiated sidewalk replacement, transit reliability measures, targeted traffic optimizations (lane reversals, signal syncs, additional turn lanes, etc) and so forth.
There are four proposals for this $52.1 million annually:
1. Return it to the residential property taxpayer so that your tax increase this year will be about 1.3% instead of 5.5%
2. Return it specifically to non-residential property taxpayer to reduce the differential between non-residential and residential property taxes. Non-res is said to pay a disproportionate share compared to residential (in comparison to other cities)
3. Create a neighbourhood revitalization fund - basically what Edmonton does - go neighbourhood by nieghbourhood and replace aging infrastructure (sidewalks, road surface, lights) and build other infrastructure to support redevelopment
4. Create a dedicated Transit Capital Fund. This would essentially allow the development of 5 or 6 dedicated transitways identified in the RouteAhead Plan - SWBRT, Centre Street Busway, 17th Ave SE Busway, SE Busway improvements (in advance of LRT development), West U of C campus mobility (possibly a gondola across the valley to connect to WLRT), 16th Avenue Crosstown BRT, etc. It would also fund all unfunded Light Rail Vehicle replacement and growth for the next ten years. The City must retire 82 of the original U2 LRT vehicles as well as grow the fleet to increase capacity (full 4 car LRT).
Quote:
Originally Posted by Bunk
A 5th option was added at Council, which is debt reduction.
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UPDATE: May 16th 2013
Here are the city's materials explaining the options. You can also read them or give feedback at calgary.ca/52million.
Spoiler!
Quote:
Originally Posted by Bunk
Public Engagement launched today.
You can go to calgary.ca/52million to look at all the information about each option and give your feedback.
Here are videos explaining each option and an intro video from the Mayor:
Intro
“Let the buses roll” Creating a new capital fund for Calgary Transit.
The idea
The RouteAhead strategy, which was developed in consultation with citizens and approved by Council in March 2013, is a 30-year, customer-oriented strategy to improve public transit in Calgary. $12.9 billion is required to fund the projects identified in RouteAhead but there is no identified source of funding. The $52 million per year would allow Calgary Transit to start several of these projects.
The problem it solves
A dedicated transit capital fund of $52 million a year for five years would allow high priority, small to medium scale projects to be built in different areas of the city.
These projects would improve transportation choices for Calgarians, providing more frequent and reliable transit options. This is the only option of the five that might leverage other funding sources from other governments. Calgary Transit estimates that each dollar in this fund could attract up to $1.50 in matching funds from the provincial and federal governments.
The highest priority projects for this funding, pending other funding sources, include:
Construction of new Bus Rapid Transit (BRT)/transitway projects, potentially including:
Transitways along the future Green Line, including Centre Street North and the Southeast Transitway (SETWAY)
The Southwest transitway, connecting downtown and Mount Royal University to Southwest communities as far as Woodbine along 14th St S.W.
The East 17th Transitway along 17th Avenue S.E. to downtown
South Crosstown BRT from Foothills Industrial through Quarry Park to Mount Royal University
North Crosstown BRT from Northeast communities to the University of Calgary and Foothills Hospital
West Campus BRT, connecting University of Calgary, Foothills, the Alberta Children’s Hospital and the Northwest LRT
Acquisition of new CTrain cars to begin four-car service at all times on the existing lines, reducing crowding, and replacing old trains that are less comfortable and more prone to breakdowns.
How it would work
Projects would be identified and prioritized based on criteria Council established in RouteAhead and our Investing in Mobility Plan and approved by Council in our regular budget process.
Of all the five options, this one is most likely to incur future operating costs as we put more buses and trains in service. This means that Council would need to cover these costs by cutting expenses elsewhere, by giving transit more tax funding, or by increasing the money that comes from fares – though more riders or higher fares.
For more information, please visit routeahead.ca.
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Give business a break Reducing non-residential property taxes
The idea
The $52 million could be used to reduce the difference in tax rates between residential and non-residential properties. At the moment, non-residential properties (mostly commercial properties like stores and offices as well as industrial properties like factories) are taxed at a higher rate than residential properties: for every dollar of assessed value, a business pays 3.91 times as much as a homeowner does.
The problem it solves
While Calgary has the lowest residential municipal property taxes of any major city in Canada, our business tax rates are in the middle of the pack. Calgary is phasing out the stand-alone business tax, as most cities in Canada have done. This will be offset by increases to non-residential taxes, with the overall impact will being revenue-neutral.
A number of business organizations, including the Calgary Chamber of Commerce, believe that reducing the non-residential tax rate could make Calgary a more appealing place to do business, benefiting the city’s economy by attracting more people to live, work and play here. This would help to contribute to a healthy local economy and job creation.
How it would work
The exact mechanics of how to apply the $52 million to business taxes have not been finalized, but the money would reduce the differential from 3.91 to 3.67. In other words, for every $1.00 of residential property tax collected, $3.67 of non-residential property tax would be collected.
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Revitalize our communities Investing in the maintenance and upgrading of older neighbourhoods
The Idea
A Revitalizing Our Communities Fund would provide comprehensive neighbourhood infrastructure upgrades, community by community, to support redevelopment and make older neighbourhoods more liveable.
The Problem it Solves
About 90 communities in Calgary are more than 50 years old, and there is insufficient funding to maintain what we have and replace what needs to be upgraded. Projects in different areas and from different City departments are undertaken as funding becomes available and needs become urgent. Work within a single community is done over time and not all at once.
Putting $52 million a year for five years into a Revitalizing Our Communities Fund would allow different types of infrastructure to be completed in a coordinated and timely manner within communities, including:
Replacement and enhancement of sidewalks, curbs and gutters, as well as street light replacement, overhead utility relocation and road, cycling, and pedestrian enhancements; and
Maintenance and modest upgrades to parks, pathways, playgrounds, community buildings, and community recreation facilities.
Depending on which infrastructure improvements are chosen, there may be associated future operating costs which would have to be covered by property taxes.
How it would work
Every year, a number of communities would be chosen for comprehensive investments, with the goal of cycling through all of Calgary’s communities as they age. (Edmonton has a similar program, though limited to roads, sidewalks, and streetlights).
The City would work jointly with communities to understand community goals, identify infrastructure needs and implement upgrades. Existing initiatives, such as our local area planning process, The Centre City implementation program, “Inspiring Strong Neighbourhoods” and “Supporting Partnerships for Urban Investment” could be used as the tools to link this funding with needs identified by citizens.
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Drop the debt Reduce The City’s debt and annual interest payments
The idea
The City, like all governments, sometimes uses debt to build certain projects. This means that we must pay interest payments every year. Reducing debt would allow us to decrease these interest payments and ultimately save us all money. Although Calgary maintains a very high credit rating, the current level of debt is relatively high, and this limits The City’s ability to borrow for future capital projects – City-owned infrastructure, facilities and other improvements that provide services to the public, such as overpasses or C-Train lines.
The problem it solves
Calgary currently has $3.4 billion in debt. While we believe this to be manageable, and we maintain excellent credit ratings, it is high by historical standards.
This funding would enable The City to pay down some of its existing debt, or avoid taking on some new debt for large infrastructure projects. Lower debt would create annual savings for The City in interest costs.
That means that this option is the only one that would certainly reduce operating budgets (and the associated taxes needed to fund them) in the future.
How it would work
It is difficult to calculate the exact impact of this debt reduction, as The City has many different categories of debt, some of which may be repaid early but some of which have significant penalties for early repayment. Since interest rates change over time, the amount of annual savings would vary depending on what interest rates are at the time that the debt is eliminated or avoided.
However, with an interest rate of 3.0 per cent as an example, this funding would save an estimated $1.56 million in interest per year, or about $1 per month in taxes to the average home.
For every additional year that debt is retired the combined annual savings grow. Eliminating $52 million of debt in one year would provide an estimated annual saving of $1.56 million in interest per year. Eliminating an additional $52 million of debt in the second year would increase the total annual savings to approximately $3.1 million per year. This combined incremental annual savings would increase with every additional amount of debt eliminated.
For more information, please see The City’s Long-Range Financial Plan.
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Give it back Lowering the tax that homeowners pay
The idea
For 2013, City Council approved a combined property tax rate increase of 5.5 per cent. On the median single residential property (assessed at $410,000), this tax increase would be $135 per year.
Returning the $52 million to the residential taxpayer would mean that the combined property tax increase would have been just $9 per year – a savings of $10.50 per month or $126 per year versus the current plan.
The problem it solves
Calgary has the lowest property taxes of any major city in Canada, and we are proud of that advantage. Lowering overall residential property taxes would provide direct benefit to taxpayers by making more money available for your own priorities.
How it would work
Because of the timing of the Provincial government’s requisition and the need to print the tax bills on time, you would not see a change for 2013, but the reduction would start in 2014.
The planned increase to non-residential property taxpayers would remain the same.
Absorb the money and ... save it or pay down debt.
Oh wait, sorry I forgot who we are talking about.
__________________
MYK - Supports Arizona to democtratically pass laws for the state of Arizona
Rudy was the only hope in 08
2011 Election: Cons 40% - Nanos 38% Ekos 34%
The city is telling the province we need money for infrastructure. If they give us money and we don't use it for infrastructure, we're undermining ourselves.
I don't understand why the Province is continually collecting education tax that it 'doesn't need'. Aren't they running a rather large deficit this year?
Surely there should be a better way to provide the city with funding than leftover education taxes.
I don't understand why the Province is continually collecting education tax that it 'doesn't need'. Aren't they running a rather large deficit this year?
Surely there should be a better way to provide the city with funding than leftover education taxes.
Indeed, if only someone was fighting for this on the city's behalf...
How much is $50 million in infrastructure anyways? The really big head aches in this city are probably far in excess of that.
I think it's actually $50 million per year. Not enough for LRTs, but as I mentioned in the "name one good thing Allison Redford's done" thread, I've been told that it could build all the BRT right-of-ways from the RouteAhead plan over 10 years.
Exactly. Why be fiscally responsible when we can cling stubbornly to our ideologies.
Infrastructure is so 2005.
What "needed" (I quote needed because not all is needed, some is wanted and there is a difference) infrastructure projects would 50M pay for that would be more fiscally prudent than saving it for something larger or paying down debt and reducing interest payments.
__________________
MYK - Supports Arizona to democtratically pass laws for the state of Arizona
Rudy was the only hope in 08
2011 Election: Cons 40% - Nanos 38% Ekos 34%
What "needed" (I quote needed because not all is needed, some is wanted and there is a difference) infrastructure projects would 50M pay for that would be more fiscally prudent than saving it for something larger or paying down debt and reducing interest payments.
BRT is long-term investment... it's a something identified as a long-term need, and it doesn't fully displace larger investments either as something like SE busway could be upgraded to LRT later.
Keep in mind this money is $52.1 million annually. So, it's $1 billion over 20 years.
In the past, when the Province vacated "tax room" and the City has taken it and used if for capital projects. The first big tranche was a couple years ago - $42 million annually for the Community Investment Fund - which is funding the 4 new rec centres and a big chunk of the Central Library. Last year there was $10.2m in tax room that was dedicated to a bunch of little things like eliminating the resident portion of City-initiated sidewalk replacement, transit reliability measures, targeted traffic optimizations (lane reversals, signal syncs, additional turn lanes, etc) and so forth.
There are four proposals for this $52.1 million annually:
1. Return it to the residential property taxpayer so that your tax increase this year will be about 1.3% instead of 5.5%
2. Return it specifically to non-residential property taxpayer to reduce the differential between non-residential and residential property taxes. Non-res is said to pay a disproportionate share compared to residential (in comparison to other cities)
3. Create a neighbourhood revitalization fund - basically what Edmonton does - go neighbourhood by nieghbourhood and replace aging infrastructure (sidewalks, road surface, lights) and build other infrastructure to support redevelopment
4. Create a dedicated Transit Capital Fund. This would essentially allow the development of 5 or 6 dedicated transitways identified in the RouteAhead Plan - SWBRT, Centre Street Busway, 17th Ave SE Busway, SE Busway improvements (in advance of LRT development), West U of C campus mobility (possibly a gondola across the valley to connect to WLRT), 16th Avenue Crosstown BRT, etc. It would also fund all unfunded Light Rail Vehicle replacement and growth for the next ten years. The City must retire 82 of the original U2 LRT vehicles as well as grow the fleet to increase capacity (full 4 car LRT).
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Trust the snake.
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I think it's actually $50 million per year. Not enough for LRTs, but as I mentioned in the "name one good thing Allison Redford's done" thread, I've been told that it could build all the BRT right-of-ways from the RouteAhead plan over 10 years.
And I would be fine with stock piling those funds as long as its transparent and we decide what to do with it.
I'm wondering where the discussion is on the deerfoot handover, you seem to be in the know for Municipal stuff, whereas I rarely follow it anymore.
I know though that eventually the Deer foot will come under city control at some point from provincial and that's a whole other budgeting issue.
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My name is Ozymandias, King of Kings;
I would vote for a neighbourhood revitilisation fund, something like what Edmonton does here. 50 year old neighbourhoods look brand new. It really is an awesome program.
Province gives Calgary money... council deciding what to do with it.
