Calgary on track to bank $40M surplus for 2016

The money is slotted to be deposited into a savings account, but one councillor says it's a sign for next year's budget that the city could adjust its spending plans.

Extra money a sign that city should permanently cut its operating budget, says Coun. Sutherland

Coun. Ward Sutherland says that by permanently reducing the city's operating budget, Calgary could find a way to lower its property taxes in 2018. (Monty Kruger/CBC)

It looks like Calgary spent roughly $40 million less than it expected to in 2016, and one city councillor wants to see the city change its future spending plans because of that.

Coun. Ward Sutherland said the savings owe to a combination of "efficiencies" within the city: overtime expenditures are down, unnecessary spending has been stopped and many vacant jobs aren't being filled.

​"Every single month, we get a financial report so we know where we're at," he explained.

In total, more than $180 million in savings have been recorded, even as city revenues dropped in the downturn.

The money is slotted to be deposited into a savings account, but Sutherland says this extra surplus means the city could cut its operating budget.

"Because we have this room — and we tend to have this room the last few years — we do have the room to reduce the operating budget on a permanent basis. That's what's going to save tax dollars," he said.

Potential to cut property taxes

Sutherland said city council could cut property taxes next year if it finds a way to lower its operating budget and control costs in upcoming labour negotiations.

The city approved a property tax freeze for 2017 by withdrawing roughly $22.5 million from the city's Fiscal Stability Reserve. 

Pulling money out of that account in order to fund a zero per cent tax increase was a one-time only solution and administration warned at the time that the move would put upward pressure on taxes in 2018.

The 2018 property tax rate will be determined after the fall municipal election.

With files from Scott Dippel