WESTLOCK – Taxes in Westlock County will go up 0.99 per cent instead of the original 2.12 per cent increase proposed in December, but Coun. Brian Coleman says it’s a “moving target” and changes will be made throughout the year if they are necessary.
The modified tax increase, said director of finance Diane Urkow at an April 14 council meeting, only covers the additional policing costs the county now has to cover.
For the county’s operating budget, this means that the municipal tax levy will amount to $11,251,328 and not the proposed $11,708,479.
“We’re going to manage this budget through 2020 and if we see revenues drop, we will make changes to this budget through the year. I think council is fully aware that this may be a moving target. Based on that, I can support this budget, knowing that we may have to make changes as we go through the year,” said Coleman.
To maintain service levels while lowering the tax increase, Urkow said they will be withdrawing $670,000 from the reserves.
“The budget does rely heavily on reserves, but we want to point out that reserves have increased by 3.8 m. over the last four years and does include funds for difficult times in that Financial Stabilization Reserve,” said Urkow.
The effects of the downturn in the oil and gas economy have been felt in Westlock County as well. From 2017 to 2019, the county wrote off nearly $1.6 million in unpaid property taxes from that sector of the industry – in January, Coleman was concerned the county would register a deficit for 2019.
Anticipating another bad year, the 2020 operating budget includes a $500,000 bad debt expense – essentially, this means that the county is now prepared to absorb another $500,000 write-off from oil and gas taxes.
“We’ve faced six years of declining assessments to the oil and gas and have tried to maintain service levels,” said Urkow, pointing out that council plans on conducting a review of service levels in 2020 “as well as other options for future budgets.”
The effects of COVID-19 didn’t go unnoticed, with Urkow noting that if there are any changes to service levels this year, they would be caused by things like the pandemic or, as in previous years, the weather.
“We’re in the hands of a really bad situation and I think we will be using less than our resources this year thanks to what’s going on at the moment,” said Coun. Victor Julyan.
There was some disagreement between council members about the effects this budget will have and where ratepayer priorities are concentrated.
“Most of our residents are going to feel this in the area of service reduction. The tax increase isn’t much, but the service reduction is where people are going to feel it. That’s where it is until council does a complete review of service levels, I guess this is what it is,” said Coun. Dennis Primeau.
This, according to Urkow, won’t happen in 2020 because a transfer from reserves offsets the decrease in municipal tax levy. However, if there are effects, they will be evident in 2021, she added.
For ratepayers in division four, Coun. Brian Coleman says the sentiment is the opposite.
“The strong message that I got from the residents in my area is that they would prefer to see service level cuts rather than a tax increase and I think this budget does support that.”
The proposed operating budget was revisited April 1 in a special budget sitting, where councillors said the goal was to reduce the tax increase to only cover the additional policing costs.
Starting in 2020, municipalities have to participate in the costs for policing, as mandated by the province late last year. For Westlock County, this amounts to $113,300 in 2020 but will increase in the next three years.
