This year's property tax increase could potentially be higher than in recent years, as Nanaimo city council has gotten started on budget deliberations.
At a special finance and audit meeting Wednesday, Nov. 27, city staff put forward a potential 8.7-per cent property tax increase as a starting point for decision-making related to the 2025-29 financial plan. An 8.7-per cent tax increase would be higher than any other tax increase in at least 10 years, following a 7.7-per cent increase last year.
According to the city, property taxes on a typical home assessed at $783,808 would increase $248 to $3,091. As well, water fees are calculated to go up $25, sewer fees up $7 and sanitation fees up $13.
Dale Lindsay, the city's chief administrative officer, told council at the meeting that the budget is a "measured" one.
"Staff are very much aware of the tax fatigue, I'll call it, that goes on and the impact that has on citizens," he said. "We do not want to bring excessive amounts of taxation forward. We need taxation, we need the appropriate levels to run our corporation, to make sure we maintain responsibly our infrastructure and provide those services that are needed, but we want to make sure we are doing it in an efficient way."
The city's 2025 revenues are calculated at $276 million, with an operating budget of $214 million. The draft financial plan shows the budget going up $13 million, with wages and benefits going up $7.3 million, the RCMP contract going up $3.9 million and asset management going up $1.5 million. Other noteworthy budget drivers include a $1.1 million decrease in investment income and a $537,000 increase for software.
Business cases not included in the financial plan include additional RCMP officers, additional community safety officers and clean team resources, and two new assistant manager positions at city hall, one in finance and one in planning. But Lindsay also mentioned that city staff will present options for city council to bring down the property tax increase to the neighbourhood of eight per cent.
He noted that over half the projected property tax increase supports protective services, about one-quarter is earmarked for wages and benefits as part of contract agreements, and about one-eighth is set aside for asset management, leaving about a one-per cent tax increase to pay for everything else.
"Increased costs of operating, increased ability to do new capital [projects] is a very small fraction of that increase," he said.
Lindsay added that at this year's Federation of Canadian Municipalities conference, there was discussion among local government officials about the need for a "new deal" considering that 60 per cent of infrastructure is the responsibility of municipalities, while 10-15 cents of every tax dollar comes to local governments. Municipalities that are "front-line" in providing services, he said, are facing increased costs to build and maintain.
"The cost per lineal metre of doing a sidewalk or a sewer pipe has gone up exponentially in the last four or five years," the CAO said. "So in the absence of increasing our budgets and in the absence of increasing taxes, the reality is we find ourselves doing less with the same."
The draft project plan being discussed as part of budgeting includes Commercial Street improvements, Millstone sewer upgrades, utilities and road upgrades on Hammond Bay Road and Third Street-Fitzwilliam Street, downtown parkade improvements, Port Theatre upgrades, stadium district improvements include turf replacement at Q'unq'inuqwstuxw Stadium, and more.
City staff noted that public works upgrades are not included in the draft financial plan as the results of the alternative-approval process are still not finalized; however, he added that the outcome of that process is anticipated to be known this week.
City council is expected to approve three readings of the 2025-29 provisional financial plan bylaw by mid-December ahead of adoption in January, and will adopt an amended financial plan bylaw in the spring.
