Halifax regional councillors have finalized the municipal budget with a 4.6% increase to the average property tax bill, including 3% for climate action.
During their virtual budget committee meeting on Tuesday, councillors voted 14-3 in favour of the 2022-2023 budget. Councillors David Hendsbee, Trish Purdy, and Paul Russell voted no.
Councillors all but finalized the budget last month, when they voted to add millions from its budget adjustment list. That included funding for the new Art Gallery of Nova Scotia, more city planning staff, and free transit this summer to help Haligonians “get back out there,” as Premier Tim Houston and his communicators might put it.
The approved budget will see the municipal portion of the average residential property tax bill, based on the average taxable assessment of $270,000, rise from $2,050 to $2,144 — $94, or 4.6%. That increase accounts for rising property values; the residential tax rate will actually fall from $0.813 per $100 of taxable value to $0.794.
The average commercial tax bill, based on the average assessment of $1,462,000, will rise from $43,406 to $45,395 — $1,989, also 4.6%. Unlike the residential rate, the commercial rate is rising from $2.953 per $100 of taxable value to $3.105.
The approved operating budget is about $1.1 billion, including $925.7 million in municipal spending, and the capital budget is about $319 million.
Included in the spending is millions for climate action, in line with HRM’s plan, HalifACT 2050, like electric buses and fleet vehicles and building retrofits. Those projects are funded by a 3% increase to the average property bill, $0.023 on the rate.
It was originally part of a 5.9% recommended increase to the average tax bill, and councillors debated whether it should be broken out separately, as recommended by staff. They ultimately decided to move forward with the plan to list that $0.023 separately on tax bills, much like transit taxes.
But the climate action tax was the sticking point for Purdy, who has previously argued HRM is powerless to effect climate change. On Tuesday, she argued residents can’t afford the 3%.
“This is not the right time. I remember back in November feeling that this proposed tax increase was tone deaf to the needs of many of our residents and small business owners. If that was even remotely true then, it is certainly even more so now,” Purdy said.
“I am quite honestly surprised that I seem to be the only one who’s really concerned about the timing of this. It seems as if we are moving full steam ahead as if we were business as usual. I have spent this whole budget season agonizing. It makes me sick to my stomach. I’ve lost sleep … I have listened to the arguments for this tax. I admire the intelligence of the voices who have contributed to this discussion. However, when I step outside of this bubble, like to the grocery store or to the gas station, I do not see business as usual. We are not business as usual.”
Coun. Sam Austin responded to Purdy’s comments.
“It’s business as usual as a civilization that has gotten us ourselves into this awful mess in the first place,” he said of the climate crisis.
“We opted to press the snooze button over and over and over on this issue. And now the science is screaming loud and clear.”
Acknowledging that other councillors wouldn’t support a cut to the climate tax, Purdy made an attempt to cut elsewhere, from items added from the budget adjustment list.
Purdy proposed to cut $250,000 in funding for Halifax Public Libraries’ programming to help people following the ongoing pandemic and $924,700 to hire more planning staff, and she proposed to cut the funding for the new art gallery from $7 million over 10 years to $3 million.
Those cuts would’ve reduced the average tax bill hike from 4.6% to 4.4%, but the move would’ve required a vote against the main budget. Purdy’s colleagues showed no appetite to follow along, and the main motion passed.
Councillors did explore another option to bring the average tax bill increase down to 4.4%. When it announced nine special planning areas last month, the provincial government also gave the municipality $2.3 million to study those areas. That money more than offsets $1.25 million added to the budget for the same purpose.
Municipal staff recommended simply leaving the money in the budget as a contingency, but told councillors they could use the money to lower the tax rate. It wasn’t recommended, as the city’s finance staff always urge councillors not to use one-time cash for ongoing expenses.
Mayor Mike Savage argued that because the money came in after council had finalized the budget adjustment list, it should be used to partially offset the tax hike.
“That money came to us since we last met, and it is for something already in the budget, I think it should go to reduce the tax rate by the small amount it does,” he said.
Savage would’ve had to convince his colleagues to defeat the overall budget to pass the reduction, and he opted instead to vote for the 4.6% average increase.
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