District of Houston budget meeting begin.

First draft of District’s 2023 operations budget released

Council cautious about implications for District finances down the road

The District of Houston council seems comfortable, for now, in considering a budget which calls for a 2.5 per cent tax hike this year but members are worried it may have implications down the road.

The comments followed the presentation Feb. 7 by finance director Jennifer Larson of a draft operations budget of $7.870 million that’s in line with council’s past practice of raising taxes by that 2.5 per cent mark.

Council members are now at home, pouring over the document as well as inviting public comment leading up to a final spending plan to be enshrined in a bylaw in early May.

Of that $7.87 million, $4.725 million would come from property taxes, including that expected from Canfor’s sawmill slated for closure in April.

Larson told council the closure will not affect this year’s tax payment by Canfor but what the company may be paying in years ahead ultimately depends on what the company does with its current mill assets and decisions on a replacement.

Residential taxpayers would pay $1.588 million while major industry, the classification for Canfor, would pay $1.78 million.

In looking at 2022 tax rates, the draft operating budget indicates that the average Houston house value of $227,801 resulted in paying $1,270 in municipal taxes compared to Smithers residents paying $1,691 on an average house value of $421,013 and Burns Lake residents paying $1,344 in municipal taxes on an average house value of $213,542.

Projected wage expenditures are down in some areas because of shifts in how spending has been calculated this year compared to last.

But spending in some areas is to increase thanks to changes in specific areas of operation.

Although, for example, the District is removing economic development from the Houston and District Chamber of Commerce, it is taking money it would have spent there and adding more to create a new economic development position.

And the leisure services department wishes to hire a full time person to coordinate directly with arena and park users.

Chief administrative officer Michael Dewar told council the draft budget’s calculation of a 2.5 per cent tax increase stands out around the province where other local governments are forecasting increases far in excess, with some reaching the double digit territory.

“Right now we have the lowest increase out there,” he said.

Mayor Shane Brienen cautioned council members that the proposed budget, if adopted as is, might have an unknown impact in future years should it not provide adequately for maintaining the District’s assets.

“This is one that we can get by, you know, for a year or two, but at some point we will have to look at, you know, once again aligning our services that we offer to the community as well as our taxation rates,” he said.

“I’ve been on a council that decided to go 0 per cent for four years, and I can tell you that that made me look really good ….. [but] you got to be really aware that it’s the best use of the money and we’re not setting ourselves up to fail down the road.”

He did add that the District’s future financial situation will become more clearer by summer when Canfor decides if it will build a new mill or not.

Councillor Troy Reitsma was one councillor who felt that the proposed 2.5 per cent hike may be a bit low if it means digging deeply into the District’s reserves and surpluses.

“If we start dipping into that too much, then in five years it’s going to be a required 20 per cent tax increase or a required 15 cent tax increase,” he said.

“I’m kind of on the fence, but I think two and a half per cent is a little bit low. And I would be okay with seeing it be higher than that. I’m just concerned with with dipping into our surpluses too much,” Reitsma added.

More about the District of Houston’s projected financial plans for this year, and any potential implications on taxes, will be known when the draft capital expenses plan is released. That will take place at the Feb. 28 council meeting.

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