New Westminster taxpayers could be looking at a property tax rate increase of around eight per cent in 2024 based on discussions at a recent budget workshop — but the final number won’t be known until January.
At a Dec. 11 workshop, council considered proposed service enhancements for the 2024 draft general fund operating budget. A staff report stated some of the challenges impacting the 2024 budget include recently settled collective agreements and the opening of təməsew̓txʷ Aquatic and Community Centre (TACC).
“Proposed services enhancements, pending council deliberation and approval, form part of a multi-year strategy that aims to improve staffing levels within city departments, especially in areas that promote organizational resiliency,” said the report. “This includes the establishment of a new division (housing) and a new department (community services), while at the same time preparing for the opening of the new aquatic and community centre.”
At the workshop, staff presented three budget scenarios for council’s consideration:
Scenario 1 includes $12.2 million in service enhancements — which would result in an estimated 5.5 per cent increase to property taxes.
This is considered a “baseline” budget that includes increases that are contractual (such as collective agreements) or regulatory in nature (such as insurance and E-Comm services.)
Jacqueline Dairon, the city’s acting director of finance, said the “lion’s share” of the increase in Scenario 1 is for collective agreements. New staffing positions in this option are related to regulatory requirements, such as two positions in the fire department for regulatory work in the areas of fire prevention and emergency management, and a maintenance worker at Massey Theatre.
Scenario 2 includes $20.6 million in service enhancements, which would have an estimated 6.8 per cent increase on property taxes in 2024.
The staff report states this option includes funding for the opening of TACC (including pool and building service workers, cashiers, program assistants, and auxiliary staff) , implementation of a crises response team pilot project, support for human resources and information technology (including an HR advisor, benefits coordinator and workplace wellness).
“For Scenario 2, if a single-family residence was assessed at just under $1.6 million, the 6.8 per cent increase represents approximately $269. For a strata unit assessed at approximately $650,000, it would be $110,” Dairon said. “And for a business valued … at $3.7 million, it would be $2,059.”
Scenario 3 includes $23 million of service enhancements, which would have an estimated 8.5 per cent increase on property taxes.
It includes additional investments in TACC, emergency services, human resources and information technology, and the streamlining of housing unit approvals.
“Scenario 3 builds on Scenario 2, and it presents some additional enhancements that while staff feel are extremely important and wanted to be sure to bring them up with council, that they could be deferred into 2025 or beyond without negatively impacting the city's ability to deliver services, key initiatives and drive the strategic plan,” Dairon said.
Among the items included in Scenario 3 are a position in the engineering department for additional parklet cleaning, an additional housing analyst and seven suppression firefighters for New Westminster Fire and Rescue Services.
At a budget workshop in November, staff presented council with nine memos related to plans and priorities that were expected to impact the 2024 budget and beyond, including: opening of təməsew̓txʷ Aquatic and Community Centre; creating a housing division; responding to the three crises of homelessness, mental health and addictions; and integrating the climate action and the electrical department.
“I recognize it's a big year,” said Mayor Patrick Johnstone. “We had, of course, labour negotiations that are showing up in this in this in this budget more than any other, and that matches the regional trend of what's going on.”
Johnstone said the city always knew the city was going to be challenged in the year it opened the new aquatics and community centre, as it has to staff the facility. He said some other things in the budget were not anticipated a year ago, such as the need to staff a housing division to help address legislative requirements coming from the province.
Coun. Tasha Henderson said departments have recommended enhancements to the budget that are intended to help achieve council’s strategic priorities.
“I do trust that this list of enhancements likely started six miles long, and has ended up to where all the department leads thinks the most efficient way to get us to where the community is asking us to go,” she said. “And in classic, New West style, we have some pretty ambitious goals.”
What scenario does council support?
Coun. Nadine Nakagawa said she was surprised to see some of the staffing positions planned for TACC included in Scenario 2, saying the city may not be contractually obligated to provide those services but it is “project obligated” in order to make the new facility successful. She also said funding to address the three crises pilot project is also in Scenario 2, even though council is committed to that initiative.
“What I'm getting at is that I see Option 2 as the actual minimum,” she said.
Coun. Ruby Campbell said Scenario 2 best reflects investments in initiatives that community members have supported, such as support for vulnerable populations.
“I was surprised to see təməsew̓txʷ Aquatic and Community Centre and crises response in Scenario 2,” she said. “I feel like we've already debated all that. Let's just do it and open this awesome new centre and let's also start to address some of these needs that we have in the community.”
In addition to supporting Scenario 2, council unanimously supported amendments to fund several items included in Scenario 3, including positions related to youth services and supports for accessibility and inclusion in recreation programs.
In his opening comments about the budget, Coun. Daniel Fontaine expressed concern that New Westminster had a 6.4 per cent property tax increase in 2023 and is potentially looking at a 6.8 per cent increase in 2024. Fontaine, who voted against last year’s financial plan, said some residents are “struggling under the weight of property taxes.
Later in the meeting, Fontaine proposed an amendment that the city incorporate New Westminster Fire and Rescue Services’ positions recommended in Scenario 3 into Scenario 2. He said it’s important for council to consider those firefighter positions as part of the 2024 budget.
“We know that it's critically important for us to the supporting our fire department,” he said.
Nakagawa supported the seven firefighter positions as part of the 2024 budget, but noted “the budget is getting bigger” and the potential tax increase is also increasing. Based on comments from the fire chief, she said it sounds like the additional firefighters could result in overtime savings and could contribute to staff well-being and job performance.
Council unanimously supported Fontaine’s amendment to include the seven firefighter positions from Scenario 3 in Scenario 2.
Divided on funding
A bit later in Monday’s budget workshop, Fontaine proposed an amendment that the 2024 property tax increase be limited to a maximum of 4.8 per cent. He recommended that any increase over that amount come out of the city’s climate action reserve fund.
Fontaine said the amendment to fund the seven additional firefighters will add about $1 million to the city’s budget. Because firefighters are doing “a lot of climate action work”, he recommended the fire suppression positions be funded from the climate action levy being collected by the city.
“They're out there in the heat dome, they're going to the apartments when people are overheating, they're responding to emergencies as a result of climate change, and yet, not a single dollar of the climate action fund is being directed to the fire department,” he said.
At the workshop, staff told council the climate action reserve fund will total about $42 million by the end of 2023.
“None of that climate action fund in this 2024 operating budget is actually being applied to the fire department,” Fontaine said. “So if we pass this, what we just previously passed with the fire department, the $1 million, will not come out of property taxes, it'll be paid for out of the climate action reserve fund.”
Fontaine said “bold action” is needed to minimize the tax bill of homeowners and businesses.
“In my opinion, even 4.8 per cent is a lot of money coming out of the pockets of New Westminster taxpayers,” he said. “And if we pass this motion, that will be limited to 4.8 per cent.”
Johnstone, however, said the climate action reserve bylaw defines what the climate action reserve fund is for, and the city is currently doing an analysis of how that money can be best invested in order to reduce greenhouse gas production and deal with both climate change mitigation and adaptation in the city.
“This motion would in effect, take $3.2 million out of the climate action reserve every year to put into general operations. That is not the intent of the climate action reserve, and I don't think it's good practice,” he said. “It will not effectively reduce greenhouse gases or address the adaptation problems we have with climate action in the city.”
Johnstone said the amendment to fund the additional firefighters moved the 2024 tax increase closer to eight per cent, up from the 6.4 per cent that had been proposed in Scenario 2.
Coun. Jaimie McEvoy said he’s looked at some of the tax increases being proposed in other communities, to see where New West falls. Here’s what he’s found: Burnaby – 4.5 per cent; Vancouver –7.6 per cent; Delta – 7.75 per cent; Port Moody – 8.13 per cent; Coquitlam – 8.9 per cent; and Surrey – 12.5 per cent.
Henderson said it would have been “helpful” if Fontaine had provided a “holistic” motion to council, rather than proposing an amendment to add the additional firefighters to the budget and later proposing a funding mechanism for those positions, as well as other budget items.
“I wholly support the increase in staffing for the fire department,” she said. “I don't want them to feel like they are sort of being used in a sort of way around a budget conversation. So I think we should, if any of my colleagues are bringing a motion forward, it would be helpful if they could be explicit in sort of the entirety of their desire here.”
In a 5-2 vote, council defeated Fontaine’s amendment to restrict the property tax increase to 4.8 per cent and fund the remainder out of the climate action reserve. Coun. Paul Minhas supported Fontaine’s amendment, but the rest of council voted in opposition.
At the end of the workshop, council approved a recommendation in support of Scenario 2, along with the addition of some items from Scenario 3, including the seven additional firefighter positions. It passed 5-2, with Johnstone, Campbell, Henderson, McEvoy and Nakagawa in support and Fontaine and Minhas in opposition.
Under a timeline mapped out for consideration of the 2024 budget, council will consider refinements to the capital budget at a Jan. 8 workshop and will consider refinements made to the operating budget (based on this week’s workshop) at a Jan. 22 workshop.
