It’s budget time at the District of Houston so it’s asking residents how they want it to spend their tax dollars for the next financial year which begins Jan. 1, 2023.
And, just as important, it’s asking residents how much money they should send the District for the various services it offers.
While a draft budget for public consumption likely won’t be ready until early 2023, the District is encouraging residents to fill out the survey as soon as possible.
It first wants to know if survey responders rent or own and then inquires as to what the most important community issues are such as accessibility, access to health services, access to recreational opportunities, mental health services, programs for seniors, air quality, climate change, arts and culture, economic development, public safety, how the District governs the community and trails and sidewalks.
Survey responders are then asked to zero in on what they feel the District’s most important services are, ranging from animal control to the arts to bylaw enforcement to the cemetery, to the Claude Parish Memorial Arena, to economic development to road construction and maintenance to snow removal to how tax money is managed.
But, as the survey points out, the District is required to balance its budget each year.
“Inflation increases the cost of providing services because the cost of materials, wages and contractor fees goes up. As a result revenue must also be increased to maintain the same level of service,” the survey adds.
Survey responders are then asked if they favour increased user fees for the leisure service and cemetery, increased user fees for utilities, a slight increase in property taxes, a large tax increase, no tax increase mean there be a reduction in services or new user fees.
Overall, the District also wants residents to indicate preferences for tax increases or fee increases.
A property tax decrease would mean a substantial service drop, no tax increase would mean a reduction in services while increasing user and utility fees would do away with the need for a tax increase.
The District further estimates that an increase in property taxes of between 3 to 5 per cent would be needed to maintain existing level of services without touching user or utility fees and that raising utility and user fees would limit property tax increases to between 2 to 3 per cent.
While it is too early yet for the District to decide upon the size of a property tax or user fee increase, it is hinting that inflation will pose a challenge for any 2023 spending plan.
Information provided indicates property taxes would need to be increased by 3 to 5 per cent to maintain existing service levels and that property taxes could be limited to a 2 to 3 per cent hike by increasing utility and user fees.
But should user and utility rates stay the same, property taxes might have to go up by five per cent or more, the information indicates.
For comparison purposes, the District indicates that a home assessed at $200,000 in 2022 paid approximately $1,800 in property taxes so that a 1 per cent bump works out to $18 and that a 3 per cent hike works out to $54.
Survey responders are also asked to indicate their preferences for service cuts depending upon whether they wanted tax increases or decreases or utility and user fee increases or decreases.
In past years the District has set its property tax hike goal at 2.5 per cent a year as outlined in a rolling five-year financial plan it must renew each year.
“The tax rate is considered by council every year. Often a five-year financial plan will estimate what the increase may be, but ultimately, council has the authority to determine the mill rate annually,” said District of Houston chief administrative officer Michael Dewar.
Even in advance of a first look at a draft budget, the District of Houston faces a range of spending decisions and other circumstances that will test its finances.
On the revenue plus side, the new District of Houston council must decide what to do with the $410,000 that is left over from a $1.066 million COVID relief grant provided by the province.
On the spending side, 2023 will be the third year in a row the District will try to construct a right hand turning lane from Copeland onto Hwy16 and to replace the aging watermains underneath the road surface.
In 2021 the contractor selected ran into winter before the project could be completed and this year another contractor backed away saying it was unable to carry through on its plans.
The projected cost has increased each year and council will see if the $400,000 it has now set aside is sufficient.