BARRHEAD- The majority of Town of Barrhead residents and business owners should see their 2021 tax bill remain static or even drop. And if they do see an increase, it will not be because of the mill rate.
On May 11, councillors unanimously approved the 2021 Final Operating and Capital budgets, setting the mill rate at 8.4775 and 14.0905 per cent for residential and non-residential, respectively. It is the second straight year there has not been an increase in the mill rate.
The mill rate is the amount of tax payable per dollar of the assessed value of a property calculated per $100,000 of assessed value.
Due to Alberta's Municipal Government Act (MGA), the mill rate is approved separately, as part of the Property Tax Bylaw, despite it being an integral part of the budget process. The bylaw also sets the tax 2021 payment deadline as Sept. 30 and the penalty for late payment at 6 per cent. Before 2020 this rate was 12 per cent.
Finance and administration director Kathy Vickery said it was a challenge to balance the 2021 budgets because of what is expected to be a reduction in property tax revenue due to an overall decrease in the taxable assessments.
The total tax assessment from 2020 to 2021 dropped by more than $14 million going from $501,814,490 to $487,195,390.
The council package notes that most single-family assessments decreased by an average of 2.5 per cent while non-residential assessments decreased by an average of 4.5 per cent.
Vickery noted the result is a reduction of $154,358 in municipal tax revenue, split almost equally between residential and non-residential properties.
"Once we had the assessment, we went over everything again, line by line," she said. "All the departments worked really hard to balance the budget without increasing the mill rate."
Vickery also noted that it is the second straight year that there was a reduction in the overall assessments. "At this point, we don't know what will happen in 2022, but we believe there might be another reduction. Residential might be somewhat stable between the two years with a slight reduction in non-residential."
For the most part, the tax reductions property owners will see will be slight.
Vickery notes that about 99 per cent, or 1,569 of 1,777 residential owners, will see a reduction of between $1 and $100. Another 87 will see their property tax decrease by between $100 and $300, while six owners will see savings of more than $300.
However, not all people will see a decrease in their residential taxes. Vickery noted 115 tax rolls will see their taxes increase.
On the non-residential side, 274 of the 279 tax rolls will see a decrease in their tax bill from $1 to more than $1,000. Five non-residential properties' tax bill will see an increase from 2020.
Requisitions and other tax rates
Unlike the mill rate, the province has slightly increased the rate for the school requisition, or school tax, that municipalities collect on their behalf. The residential and non-residential school requisition rate increased to 2,6831 and 4.0989 per cent from 2.6763 and 3.9823 per cent in 2020.
And although the rate increased, because of the lower assessment values, the amount the town will have to collect decreased by about $30,000, going from $1,479,691 to $1,451,773.
The amount the town will collect for the Barrhead and District Social Housing Association (BDSHA) dropped to $20,890 from $60,477, the result of a tax rate decrease to 0.0435 in 2021 from 0.1221 in 2020.
Residents might notice a small increase in the amount they will have to pay for Barrhead Regional Aquatics Centre.
For the sixth straight year, the aquatic centre debenture payment will be noted as a separate line item. It is set at 0.5964, up from 0.5782 the previous year. The increase will cost property owners an extra $1.82 per $100,000 of assessment.
2021 operating and capital budgets
The operating budget predicts revenue of $14,424,250 and expenses of $114,4,11,550 plus the amortization expense budget of $1,897,00 for a surplus of $12,700.
The capital revenue and expenses budget is pegged at $7,098,360.
On the operating revenue side, the property taxes and linear assessment is the largest revenue source estimated at $4,816,350, making up 33.4 per cent of the budget. Sales and user charges are expected to bring in another $3,912,520, while franchise fees, government contributions and government grants combined account for $2,258,940. Franchise fees, licences and permits are expected to bring in $1,397,520, while the swimming pool debenture will bring in an estimated $290,565.
The municipality will also draw $274,890 from its operating reserves.
On the operating expenditure side, water, sewer, garbage and recycling the lion's share of the funds at $3,349,970. The next largest expenditure goes to recreation, which includes the aquatic centre, pool, parks, sportsgrounds and cemetery at $2,693,960.
Public services and roads and storm sewer comes in next at $1,768,620 followed by protective services at $1,704,100, school and BDSHA requisitions at $1,519,870, contributions to capital projects at $1,116,190 and administration at $1,050450. The former does not include the amount spent on council at $225,450. Another $416,570 will be spent on development, communications, tourism and twinning.
The final operating categories are Barrhead and District Family Support Services (FCSS) at $437,420 and the airport and library at a combined 128,950.