Calgary

Calgary looks to cut $90M from budget, coupled with tax cuts

The City of Calgary is proposing $90 million worth of cuts to the 2021 budget, coupled with reduced taxes, as it weathers a continuing fiscal storm. 

Police and public transit take biggest hits and 162 positions will be eliminated

Calgary Mayor Naheed Nenshi said Calgarians will feel the impact of cuts to the 2021 budget. (Drew Anderson/CBC)

The City of Calgary is proposing $90 million worth of cuts to the 2021 budget, coupled with reduced taxes, as it weathers a continuing fiscal storm. 

The cost cutting includes shedding 162 full-time positions, which would bring the number of people on the payroll below 2013 levels, city administration said as it presented council Monday with the proposed mid-cycle adjustments to the One Calgary Service Plans and Budgets. 

The budget plan will now hit council chambers before any cuts or adjustments are finalized. 

Since 2019, the city has cut 574 full-time positions, or 3.5 per cent of its workforce. It's unclear at this time how many of those layoffs will come through attrition or vacancies. 

The proposed cuts include $10 million from the Calgary Police Service. Civic partners, including the Calgary Zoo and Heritage Park, which have struggled through the pandemic, could see a $600,000 reduction in funding in the coming year. 

Calgary Mayor Naheed Nenshi said Calgarians will feel the impacts, saying the city has added the population equivalent of two Red Deers since 2013 but with the same number of public servants.

"I think, obviously, people are going to feel it," he said. "They're going to see that in their services they get."

Taxes would drop slightly

The original plan for 2021 called for a three per cent tax increase but the COVID-19 pandemic and a depressed economy ensured that would not be allowed to go ahead.

The city estimates the impact of COVID at just over $52 million in 2021, including a $35.7 million loss for public transit. 

Instead, residential taxes would average a decrease of 0.67 per cent in 2021, although a typical single-family home could see increases of 0.58 per cent. 

Business property taxes would decrease by an average of 0.55 per cent, but some business property owners will see increases — some significant. 

A retail neighbourhood shopping centre, for example, could see an increase of 17 per cent, while hotels could see decreases of 27.66 per cent. 

The plan comes on the same day the city released it citizen satisfaction survey, which found 52 per cent of respondents would be willing to pay more in taxes in order to maintain or improve services. 

Nenshi said the city will cover its deficit this year thanks to funding from Ottawa and some from the province. He noted there will be a little left over that can be used for the first quarter of 2021 and for potential emergency funding for social agencies in the city. 

$26M in cuts through SAVE program

Of the $90 million in proposed cuts, $26 million has come through the city's new Solutions for Achieving Value and Excellence (SAVE) program, which sought input from employees about changes within their departments. 

That exceeded the 2021 target of $24 million for the program. Fully $14.4 million of onetime savings for 2021 comes through the "optimization" of fiscal reserves, the city said.

One proposal through the program that will go before council is the elimination of the civic census, which is projected to save $924,000 in 2021 and $936,000 in 2022, when the decision will be re-evaluated.

If the proposed cuts are approved, it would mean the city has cut $177.5 million from its operating expenditures since 2019.

This will be the third year of the city's current four-year budget cycle.

Councillors react

Ward 11 Coun. Jeromy Farkas doesn't think the cuts go far enough, but he also argued against cuts to first responders, including police. 

"I think we're gonna … at least need, about another $90 million to be able to get us to where we need to go," he said after the presentation from administration, citing what he sees as the need for ongoing tax reductions. 

But his colleague from Ward 1, Coun. Ward Sutherland, says that would cut too deeply, while calling for changes to the way property taxes are assessed — a change that would have to be made by the province. 

"This is a broken system.... We need this fixed, because every single year we run into this, and it's not fair to other businesses, and it's not fair to Calgarians when it comes to housing," said Sutherland. 

Nenshi also took aim at where additional cuts could come from.

"If people on council want to say go further, I'll say the same thing I say every year: tell us where," he said.

"Tell us where to cut and then see if you can get eight votes."

Corrections

  • A previous version of this story said Calgary Transit was being cut by $6.5 million. That is incorrect.
    Nov 09, 2020 9:07 PM MT

ABOUT THE AUTHOR

Drew Anderson

Former CBC digital journalist

Drew Anderson was a digital journalist with CBC Calgary from 2015 to 2021 and is a third-generation Calgarian.

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