Yellowknife set for five-percent property tax increase

Yellowknifers can expect a five-percent property tax increase this year after councillors finished working through the city’s draft budget.

The draft budget had proposed a 7.22-percent tax increase.

Over two nights, council made a series of small cuts to operations and maintenance that brought the tax rate down to an estimated 6.42 percent. Council then unanimously approved a motion by Steve Payne to bring that down to five percent.

“There’s an expectation from the city residents for us to do everything we can to keep this tax rate under control this year,” Payne said.

“Five percent is not a terrible tax rate to have this year, considering what some municipalities around Canada are proposing right now.”

Council bridged the gap from 6.42 percent to five percent by reducing the amount of municipal taxes transferred to the capital fund.

Transferring some tax revenue to the capital fund helps the city pay for the things it needs to build, but councillors had earlier found some significant savings in the city’s capital budget – which is separate to operations and maintenance.

Those savings mean Yellowknife has enough in its capital fund to survive a smaller slice of tax revenue.

Mayor Rebecca Alty said the five-percent increase would “balance the short term and the long term,” adding that the capital budget savings represented some “heavy lifting” by council that left the capital fund in a “good, healthy position.”

Many of those savings came by deleting budgeted 2024 expenditures on line items that were already carrying over significant sums from previous years, when little or no work was carried out because staff couldn’t get everything done – particularly as the likes of Covid-19 and wildfires got in the way.

The budget will be formalized in meetings next week.

What changed?

The heavy lifting Alty is talking about involved the likes of slicing $1 million out of the budget for the submarine water line replacement, a major city project to establish a new drinking-water supply line leading to the Yellowknife River.

The current water line is decades old and in need of replacement, but the project has been pushed back more than once. As a result, the city is already carrying over $2.5 million from previous years that wasn’t spent, so councillors felt deleting this year’s fresh $1-million spend on the water line could occur without interfering with ongoing work.

Other changes to the capital budget included removing:

• $290,000 for Range Lake trail improvements and a safety fence between the Fritz Field ballpark and nearby playground;
• $250,000 for implementation of accessibility audit recommendations, on the grounds that there is already $1.3 million being carried over that hasn’t yet been spent, which is more than enough to fund significant work this year; and
• $400,000 to deal with some “Niven Lake trail sludge” reported by a resident that turned out not to be anything worth worrying about after testing.

Council voted down a proposal to increase the community grant funding that’s awarded each year, and a discussion about adding a new position of deputy city manager was bumped to 2025 at the earliest.

The operations and maintenance cuts that saved some extra cash were fairly minor in nature.

While a request from the Arctic Inspiration Prize for a $10,000 contribution was approved, $75,000 to work on a new economic development strategy was deleted, on the grounds that the city’s economic development team already has a lot on its plate this year.

$50,000 was saved by removing a proposed contribution to a “capital area committee” that has never actually properly existed. An extra $39,000 will be raised from higher ambulance fees.

Lastly, $100,000 to review the city’s street outreach program was deleted because the federal government has now promised to pay for that.

Street outreach plan rejected

Council’s street outreach discussion extended well beyond the planned review, and formed the biggest single topic of the five hours councillors spent reviewing the budget.

Councillor Tom McLennan introduced a motion that would have expanded street outreach into what is known as an advanced care paramedic model, something the Yellowknife Women’s Society – which operates the program – has requested.

The women’s society wants street outreach to do more than its current role of helping vulnerable Yellowknifers get somewhere safe. Even that is proving a challenge this winter, with street outreach having trouble keeping either of its two vans on the road, and a fundraising drive has been established to help the program.

Earlier in the budgeting process, council had already indicated it wouldn’t support a significant increase in funding for street outreach. But McLennan argued he could do it in a way that, in 2024 at least, didn’t increase residents’ tax rate.

McLennan’s proposal involved ramping up municipal funding for street outreach to $730,000 this year, $1.1 million in 2025 and $915,000 in 2026, significantly higher than the $360,000 the city currently provides annually.

In return, that funding would turn street outreach into a model involving a better-equipped vehicle, a trained paramedic and more focus on harm reduction and basic medical care.

McLennan said the city could balance “keeping the increase in cost of living reasonable while making a meaningful contribution to addressing one of the most longstanding and impactful issues facing residents.”

“Trying new approaches and getting practical experience as soon as possible is what our community needs,” he added. “While the review now funded by the federal government will certainly have value, I feel we cannot afford to wait until this review starts to produce practical impacts.”

Councillor Ryan Fequet agreed, saying: “This is a service to help people in need and public safety is within our mandate. Finding ways to retain staff and create a positive environment and revitalize downtown is within our mandate. So stepping back is not an option because the people on the street and the people who are feeling unsafe right now, they don’t get to step back.”

But a majority of councillors said that kind of program is a territorial responsibility, not something the city should fund, despite McLennan’s hope that an increase in municipal funding might bring the GNWT to the table.

“The GNWT has shown, time and time again, they will not participate in the funding. It is their responsibility. They need to step up,” said Garett Cochrane.

Stacie Arden Smith added: “By us forking over this money to provide this service, we are then telling the GNWT that we don’t need their assistance.”

The proposal was defeated with McLennan and Fequet in favour.

This year’s budgeting process took place later than is normally the case because of the interruption caused by last summer’s wildfires and evacuation.

Usually, the budget is finalized in December each year.

Correction: February 8, 2024 – 9:49 MT. This article initially stated that $10,000 to support the Arctic Inspiration Prize was deleted from the budget. In fact, it was added. This report has been updated to reflect that.