Saskatoon city council makes 1st cuts to proposed budget, potential property tax increase now sits at 6.6%

Saskatoon city council shaved $1.68 million on its second day of budget deliberations, reducing the current potential 2024 property tax increase to 6.59 per cent.

Councillors began their second day of deliberations looking at a projected $21.1-million deficit, which would lead to a 7.22 per cent property tax increase.

On Tuesday, council unanimously passed a $7.9-million police budget increase and narrowly passed the library budget.

Wednesday's proceedings featured a narrow vote in favour of shaving a portion of the city's capital reserve contribution, the first cut into the projected deficit. 

Ward 5 Coun. Donauer introduced a motion to reduce the contributions to the city's reserves by three per cent in 2024, with the exception of the Fire and Roadway Preservation fund. 

That motion would reduce the deficit by about $1.3 million. 

Ward 4 Coun. Troy Davies said he would have proposed a larger number. Other council members said they preferred to go line by line through the budget to chisel away at the deficit rather than a large sweep.

"I don't like this any more than any more than anybody else does, but at some point we have to make some progress," Donauer said.

The motion narrowly passed, 6-5.

Moving taxes from residents to businesses

Just prior to Donauer's proposal, councillors had a contentious debate about shifting more of the property tax onto business owners than in previous years.

Ward 7 Coun. Mairin Loewen proposed changing the resident-to-commercial tax ratio from 1.59 to 1.75. That would mean businesses would pay more tax and homeowners would pay less.

If passed, the motion would have knocked down the current proposed residential property tax hike to 4.64 per cent and raised the business property tax to 10.88 per cent.

Some councillors argued making the motion without allowing Saskatoon people to voice their opinion on it was unfair. Ward 1 Coun. Darren Hill called it "reckless."

Loewen said she was offended that fellow councillors were "casting aspersions" on the intent of the motion.

Davies argued that his personal business, which closed during COVID-19, would have been forced to shut its door with a sudden increase in taxes like the one proposed.

"This would be a completely full chambers right now if I advertised that this conversation was happening today," Davies said.

The motion failed, with only Loewen and Ward 2 Coun. Hilary Gough voting in favour.

Two related motions that followed directed administration to report back about the potential to create a small business taxation subsection, and about business tax ratios and their impact on economic indicators.

City council also approved several other changes to save money Wednesday:

• Change a zoning bylaw to add more billboard locations throughout the city for about $200,000 in additional revenue in 2024. A city report said this option was abandoned in the past because of distracted driving concerns.
• Stop contributing $300 per street light installed and leave that cost fully to developers, expected to save the city about $150,000 annually. 
• Update Saskatoon Light and Power fees for special services, like cutting off or reconnecting a service or meter reading and testing, expecting to bring in another $60,000 in annual revenue.
• Discontinue municipal Christmas tree drop-off for recycling, saving $25,000 in 2024. People can bring their trees to the landfill.
• Halt yearly communications about the Healthy Yards program and end advertising and support for the Boulevard Garden Program, to save $11,600 in 2024.

Council also considered eliminating 11 planned future full-time equivalent positions at the Recovery Park Landfill Expansion.

Councillors were split on how the motion could effect operations. Some believed it was a necessary cut. Others stressed the implications for the landfill and the effects it would have on the operations at the Material Recovery Centre, which cost the city $19.5 million and opened in mid-October.

That motion was defeated 6-5.

Deliberations will continue Thursday and could extend into Friday, beyond the originally scheduled three days.