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Outlining City’s 2023-2026 Operating Budget process

​Next month, Lethbridge City Council will meet as Economic Standing Policy committee to set a new four-year Operating Budget for the City of Lethbridge.

On Tuesday and Wednesday, during additional Economic SPC meetings, Council members will hear a Budget 101 presentation from City Treasurer Darrell Mathews, receive a draft version of the 2023-2026 Operating Budget to review, hear presentations on several proposed new initiatives and receive the Operating Budget What We Heard Report, which has been compiled from online and in-person engagement completed during the past several months.

The City's Operating Budget involves the day-to-day costs of delivering municipal services and programs such as police, emergency services, streets and roads and parks. More background on the City's finances and documents can be found here:

In 2019, there was a 1.82 per cent municipal tax rate increase – which was the lowest in 20 years. The City of Lethbridge then maintained a zero per cent increase to the municipal portion of residential taxes for the three years of 2020, 2021 and 2022 to minimize the financial impacts of the pandemic to property owners. To maintain existing service levels, tax rates should at a minimum meet inflation rates. Since 2020, inflation has surpassed City tax increases and has created challenges for the operating budget. Keeping a zero per cent increase is not feasible in order to maintain service levels while responding to inflation rates and the increasing costs of doing business. In addition to high levels of inflation, the City is also experiencing external pressures as a result of recent reductions in Provincial funding to municipalities. Reduction in Traffic Safety Act Revenues and a reduction in Grants in Place of Taxes for government own properties are some examples of external pressures that are contributing to the forecasted increase.

The draft 2023-2026 Operating Budget is forecasting an average annual municipal property tax base increase of 3.77 per cent for each of the next four years which is equivalent to a $94.20 per year per single family residence, based on an average market value of $285,800. The forecasted tax increase is consistent with anticipated increases from other Alberta municipalities. Lethbridge is currently $177 below the average when comparing the total annual property tax on a Median Value Single Family Home across 21 other comparable Alberta municipalities.

"When we begin deliberations for the next four-year Operating Budget, City Council will face a number of challenges and difficult decisions related to rising costs and maintaining existing services while still trying to be fiscally responsible to our residents," says Mayor Blaine Hyggen. "This draft base budget proposes an increase of 3.77 per cent, which does not include any proposed new initiatives or changes to service levels. Council will be focused on its strategy and direction, but we also know the financial pressures we are facing."

"The Operating Budget is organized by type of operation, tax-supported and utility-funded operations, with each operation considered a separate budgeting and accounting entity," says Mathews. "Amounts are budgeted and reported along departmental/program lines, with the authority for budgetary approval resting with City Council."

Revenue for the Operating Budget is funded by the municipal portion of your property taxes and other municipal levies, as well from sales of goods and services including utility service charges and user fees for services like recreation and cultural facilities. City Council must balance the budget, as municipalities in Alberta cannot run a deficit or use debt to pay for operations.

Tuesday's Economic SPC agenda is here and Wednesday's agenda is here. Both meetings are set to begin at 9:30 a.m. each day, are open to the public and will be livestreamed on the City's YouTube page. Residents can also follow live updates on Twitter through the City Clerk's account at @LethCityClerk.  

Operating Budget Deliberations will take place from November 14-18 at Economic SPC. The recommendations from deliberations will be forwarded to City Council for potential approval at the regular meeting on November 29. In accordance with Municipal Government Act requirements, City Council must approve an operating budget by December 31 so the City can pass a property tax bylaw.

For Public Inquiries:

Call 311 |  Monday to Friday, 8 a.m. to 4:30 p.m.