The City of Duncan is considering a 5.2 per cent tax increase for 2022.
Council is expected to make the final decision on the tax increase in May.
One of the major contributing factors to the tax increase is that the city’s population has surpassed 5,000, and as a result, starting April 1, 2022, the city is now required to pay 70 per cent of policing costs, as required by the provincial Policing Act.
Peter de Verteuil, Duncan CAO, said in a press release that although the city has anticipated paying for policing since 2009, the municipality is now negotiating with the province to determine how many police officers will be included in the policing agreement, and has learned that the estimated cost per officer is higher than expected.
He said the 2022 budget was originally prepared with an expected policing cost of $169,312 per officer per year, but with recent estimates provided by the province, the city has revised its expected costs to approximately $210,000 per officer, including transportation, equipment, training, and administration.
“City council recently approved using $75,000 in 2022 from the Police Bridging Capital reserve fund to help reduce the tax increase,” de Verteuil said.
“In 2023, the city will be responsible for policing costs for the full year and, depending on the outcome of the city’s negotiations with the province and the use of the PBC reserve fund to be considered at a future date, policing costs will result in tax increases in 2023 and 2024 taxes as well.”
De Verteuil pointed out that if the city had not been collecting for the PBC reserve fund since 2009, the current tax increases could have been as large as 28 per cent.
De Verteuil said that due to the differences in assessment increases between property classes, the 5.2 per cent increase in taxes collected impacts tax bills differently depending on the type of property, and how much the property value increased compared to other properties.
He said the average value of a single detached home in the City of Duncan has increased from $399,305 to $533,361, an increase of almost 34 per cent, while the average value of a residential strata unit has increased from $242,844 to $313,345, an increase of just over 29 per cent, and the average commercial property has increased from $656,715 to $760,994, an increase of almost 16 per cent.
De Verteuil said the city has attempted to balance the increase between residential and business property classes.
That would result in an increase of $111 (7.3 per cent) for the average single detached home valued at $533,361, an increase of $33 (3.6 per cent) for the average residential strata unit valued at $313,345, and an increase of $467 (7.3 per cent) for the average business valued at $760,994.
“As strata units and detached homes are both in the same residential tax class, the city is unable to balance the impacts between these property types,” he said.