Putting Regina’s Recent Property Tax Increase Into Perspective

How Does The Increase Compare Nationally?

Property owners in Regina will see a bit of a bump come next year’s tax assessment. At its February 27th budget meeting Regina city council approved a 5.88% increase in property tax. This is down from the 7% increase that proposed earlier this year which was met by opposition from the Regina and District Chamber of Commerce and the Regina Realtor’s Association. Although the 5.88% increase is the largest in recent year, Regina has historically seen lower property tax increases than other urban centres in western Canada.

The City’s average annual increase over the last 5 years was 3.27%. By comparison, Calgary’s was 5.38%, Edmonton’s was 5.39%, and Saskatoon’s was 4.05%. Also of note, in December Saskatoon city council voted to raise property taxes by 7.43%.

The 5.88% increase combined with an 8% increase in water and sewer rates will mean the average homeowner will pay roughly $210 more next year, or $17.50 per month.

Regina City Council

The City argues that, although raising taxes is never a popular thing to do, this hike is necessary to combat the very real infrastructure deficit facing Regina and most other municipalities. While urban municipalities in Canada only receive 8 cents per dollar of total tax paid, they shoulder the burden of maintaining the vast majority of infrastructure within their borders including sewers, roads, curbs and sidewalks, water mains and more.

The percentage of total GDP invested in infrastructure by all levels of government also saw a steady decline between 1960 and 2000. Within the same time period the distribution of investment among federal, provincial and local governments changed significantly, with the federal share decreasing from 34% to 13% and the municipal share increasing from 27% to 48%. To add to this, municipal property taxes do not grow with the economy unlike provincial and federal tax tools like income, sales, and capital gains taxes.

A look at the allocation of increased tax revenue in the City of Regina’s budget highlights the need for infrastructure renewal. 1% of the 5.88% property tax increase will be directed exclusively for local road repairs and replacement. Likewise, the 8% utility rate increase is expected to raise an extra $19.8 million which will be used for upgrades to the city’s wastewater treatment plant and repairs to underground water and sewer pipes.

In a seemingly contradictory turn of events, the city will also be granting a historically high amount in property tax exemptions this year. The Roughriders, the RCMP Heritage centre and the Regina Airport authority are seeking to have over half a million dollars of property tax forgiven.

To keep this in perspective though, these exemptions amount to roughly 0.0008% of the City’s total capital and operation budget for 2014.

The revenue lost in property tax exemptions will more or less be recouped through a number of one-time efficiencies including the sale of the municipal justice building, green-house gas credits, and excess granular material from the asphalt plant. The City will also see new revenue streams through an increase in parking metre rates and the implementation of commercial business licenses.