The Town of Strathmore received its first look at what a potential 2024 budget could look like, as the Town's Manager of Financial Planning, Budgeting, and Analysis Tom Maier presented a 2024 budget introduction during Wednesday's Committee of the Whole meeting. Part of this budget introduction included looking at our tax situation and planning for what may change.
2023's budget saw a 4.6% tax increase, which resulted in a $149 per average residential assessment value of $368,500. In 2024, a potential 1% tax increase would result in $208,000, should the Town adopt an increase for the next budget.
One aspect of taxation that Maier is focused on is the tax revenue generated from residential property taxes vs. commercial taxes. He reported Strathmore currently has an 83-17 taxable assessment ratio between residential and commercial, which is quite similar to communities like Okotoks, High River, Cochrane, and Airdrie. While our ratio is comparable to other communities, Maier reported the Town may look to slightly even out this disproportionate tax revenue.
"CAO Kevin Scoble's vision is we definitely focus on increasing our amount of industrial and commercial, and that is a long-term strategy ... how do we put the right measures in place or development processes to encourage that, because you definitely gain a whole lot of additional tax dollars and support for keeping taxes more in line for residential properties if you have that support of a good industrial base," Maier said.
For reference, out of the communities that could be compared to Strathmore, Olds and Drumheller had the heaviest percentage of tax dollars from commercial/industrial at 75-25 and 74-26, but it's unlikely Strathmore would make such a drastic change and hit numbers like that.
"With the case of Drumheller they've got the prison there, that's a big tax financial support for their community. And the same with Olds with the college and other things there."
While raising the commercial/industrial tax would result in an increase in tax dollars while also keeping taxes low for residential taxes, Maier explained the solution isn't as simple as just raising taxes on business, as this also works as an advantage for Strathmore in some situations. Regarding the property tax ratio, Strathmore is the lowest among other rural communities surrounding Calgary, which makes us a prime spot for big businesses looking to invest.
"We're at an advantage with our commercial tax rate being much lower than the average out there, and how that supports our recruitment and getting businesses located here."
Given that this is just an introduction to the 2024 budget no decisions have been made, and many discussions surrounding a potential tax increase or decrease would undergo extensive analysis and discussion before the final budget is approved at the end of the year.
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