Tax cuts unlikely in Town of Iqaluit’s next budget
Though the value of taxable property in Iqaluit now sits at around $129 million this year, it’s unlikely that the municipality will be able to provide ratepayers with any tax relief in its budget next year.
IQALUIT — This summer’s building boom in Nunavut’s capital is bolstering the municipality’s balance sheet.
The value of private property in Iqaluit now sits at about $129 million plus another $41.5 million in government properties this, according to preliminary budget estimates.
Howver, Town officials still can’t say whether this will cause ratyepayers’ tax bills to go up or down next year.
Municipal taxes are spread amongst private property owners. The increase in assessed values means there are more property owners to shoulder Iqaluit’s tax burden.
Last week, Iqaluit Town Council accepted a preliminary budget for 2000 and laid some of the groundwork for formulating its new mill rate.
Council won’t set a mill rate until next year, but preliminary estimates using last year’s mill rate suggest the Town could take in $5.7 million in taxes, an increase of about $500,000 compared to 1999, said Bonita Hester, Iqaluit’s acting finance director.
The Town of Iqaluit still needs to calculate a final figure for its property values and the money it can expect to receive from the Nunavut government. Once it has those figures, it can calculate the mill rate — or property tax rate — for 2000.
Councillors will decide how much money they want to spend for the year and how much of that money needs to be collected through property taxes.
The tax bill is then divided amongst various property owners based on the classification that their property falls into, and the assessed value of their property. Other revenues are brought in from sewage charges and government grants and other municipal fees.
But this year’s increase in the number and value of properties in Iqaluit won’t necessarily result in a drop in the mill rate.
“I wouldn’t even suggest a reduction at this point,” Hester said. Extra revenues from taxes may go towards capital projects, Hester said, or new spending needs could dash any hopes of a tax cut.
“There should be some major expenditures, the way that the town is expanding,” Hester said.
In 2000, Iqaluit will have pay the increased costs of running its new sewage treatment facility.
Operation and maintenance of the new sewage plant is expected to cost about $400,000 a year. A new collective agreement with municipal employees might also change the Town’s balance sheet, Hester said.
“There may be some retroactive pay. Perhaps this year there might be quite a bit of extra money going into salaries,” Hester said.
As well, the Town of Iqaluit expects to contribute about $200,000 towards the 2002 Arctic Winter Games Host Society.
The proposed budget adopted by council last week is based on projected figures from each municipal department. That rang in at $10,696,449.
Council can still make changes to how its spends its money, Hester stressed.
Iqaluit’s administration is expected to propose mill rates for each property class in January or February, Hester said.