Feasibility report for 2021 tax and utility deferrals on horizon

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A second round of deferrals for municipal taxes and utility bills might be a possibility for 2021.

In response to the economic collapse due to COVID-19, Strathcona County council quickly passed tax and utility deferrals to help alleviate financial pressure on residents and businesses in 2020, and now, that help might be on the table this year.

During the regular council meeting on March 2, Mayor Rod Frank made a motion for administration to provide a report on the feasibility, costs, impacts, and options for creating program for tax and utility bill deferrals for 2021. This year’s property taxes are set to be collected on June 30.

Saying that the state of the economy ‘remains generally grim’ with 20 per cent unemployment in Alberta — meaning one out of five people are out of work — and about one-third of small businesses are facings closures, the mayor outlined this kind of program would be a step in the direction of good governance.

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“My office has been approached by a number of individuals who asked for tax and utility relief in the continuing wake of the pandemic. It’s true that the COVID-19 pandemic continues to have a very large, negative force on our economy and it continues to impact our citizens. It’s true our citizens have faced a triple whammy of depressed energy markets and, of course, the pandemic. We have limited tools municipally compared to other levels of governments. We are required to balance budgets and we don’t have the power to create new sources of revenue,” Frank said. “Last year, the pandemic was thrown upon us and we didn’t have much time to analyze pros and cons. We do have learnings we can gather from last year to understand the feasibility of a deferral, which would lead to a more informed decision.”

Council unanimously supported the motion.

Ward 3 Coun. Brian Botterill noted residents should remember deferrals are not waivers and, eventually, all bills need to be paid. He added the county should provide better promotion of its Tax Installment Payment Plan (TIPP), which is available to residential, commercial, and industrial customers as long as their accounts are in good standing.

The report will provide the overall uptake of the program, what per cent of revenues were collected versus deferrals, the optimal period of time for a deferral, and a comparison to what steps other municipalities are taking to help their residents and businesses.

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After the 90-day deferral in 2020, CFO Greg Yeomans said the total collected tax revenue was similar to previous years; “We didn’t see a drop off in property tax revenue. This year, it might be a little bit different since it’s an ongoing situation. But what we did see last year, because we deferred the collection by three months, we lost that investment income on the bulk of those payments which is usually due by the end of June.”

Overall, the county’s consolidated investment revenue was down by $1.6 million, but not all of that was a result of the 2020 deferral program, according to the CFO.

A fuller picture of the budget impact of deferrals will be provided within the report returning to council within the next two months.

lmorey@postmedia.com

twitter.com/LindsayDMorey

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