2022 City Budget Sets 5.2% Tax Increase
City Council will consider the 2022 Tax Rates Bylaw and Financial Plan Bylaw next month, which will result in an increase in taxes collected of 5.2%. One of the major contributing factors to the tax increase is that the City’s population has surpassed 5,000, and as a result, starting April 1, 2022, the City is now required to pay 70 percent of policing costs, as required by the provincial Policing Act.
Although the City has anticipated paying for policing since 2009, the City is now negotiating with Province to determine how many police officers will be included in the policing agreement, and has learned that the estimated cost per officer is higher than expected. The 2022 budget was originally prepared with an expected policing cost of $169,312 per officer per year, but with recent estimates provided by the Province, the City has revised its expected costs to approximately $210,000 per officer, including transportation, equipment, training, and administration. City Council recently approved using $75,000 in 2022 from the Police Bridging Capital (PBC) reserve fund to help reduce the tax increase. In 2023, the City will be responsible for policing costs for the full year and, depending on the outcome of the City’s negotiations with the Province and the use of the PBC reserve fund to be considered at a future date, policing costs will result in tax increases in 2023 and 2024 taxes as well.
Due to the differences in assessment increases between property classes, the 5.2% increase in taxes collected impacts tax bills differently depending on the type of property, and how much the property value increased compared to other properties. The average value of a single detached home in the City of Duncan has increased from $399,305 to $533,361, an increase of almost 34%. The average value of a residential strata unit has increased from $242,844 to $313,345, an increase of just over 29%. The average commercial property has increased from $656,715 to $760,994, an increase of almost 16%. The City has attempted to balance the increase between residential and business property classes, resulting in:
- An increase of $111 (7.3%) for the average single detached home valued at $533,361
- An increase of $33 (3.6%) for the average residential strata unit valued at $313,345
- An increase of $467 (7.3%) for the average business valued at $760,994.
As strata units and detached homes are both in the same residential tax class, the City is unable to balance the impacts between these property types.
If the City had not been collecting for the PBC reserve fund since 2009, the current tax increases could have been as large as 28%.
You are invited to give your feedback on the tax rates before adoption by Council in May 2022. Public consultation on the proposed tax rates is being held online at www.placespeak.com/duncan2022taxrates
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Peter de Verteuil,