News / Calgary

Bill Smith's tax increase claims may not add up

Mayoral candidate tells voters residential taxes are up 51 per cent

Mayoral candidate Bill Smith speaks to reporters after filing his nomination paperwork on Monday.

ELIZABETH CAMERON/for metro / Calgary Freelance

Mayoral candidate Bill Smith speaks to reporters after filing his nomination paperwork on Monday.

Mayoral candidate Bill Smith is standing by tax claims he put forward during his keynote campaign speech, but some experts say his math may be off.

Smith told supporters at a rally: “Since this mayor (Naheed Nenshi) was elected residential property taxes have increased 51 per cent, and for local businesses 70 per cent.”  

His campaign Twitter account sent out the same quote in a tweet, which has since been retweeted over 100 times. The 51 per cent residential tax increase is also cited on his campaign policy page.

When Smith’s campaign was contacted to explain how he arrived at his numbers, they provided a link to the city’s tax levy – the total amount of tax money the city brought in each year.

That number has increased by 53.8 per cent since 2011 when it comes to residential taxes, and 74.9 per cent on non-residential.

University of Calgary Economist Trevor Tombe said saying that number equates to a tax increase is wrong. Instead it shows the growing city’s growing tax base.

“Much of that growth will come from a growing city population and from inflation,” said Tombe.

Calgary added about 150,000 new citizens since 2011, according to the city census data. It also had 74,126 housing starts to the end of 2016, each contributing more tax dollars to city coffers.

Nenshi said Smith’s claim is “not exactly accurate.”

“In 2011, the mill rate was about $3.25 per $1,000 of assessed property. And this year it’s about $3.90 – which doesn’t strike me as 51 per cent,” he said.

Coun. Andre Chabot on the other hand, said Smith isn’t wrong, but he isn’t right either.

“They don’t fully understand the numbers they’re putting out there,” he said.

Chabot said the municipal portion of homeowners’ bills have gone up 51 per cent during Nenshi’s time in office, but that doesn’t reflect what homeowners have seen on their bottom line because provincial portions have gone down.

For Chabot, the increase in how much tax money the city is bringing in is what he finds alarming, because it’s increasing much faster than population growth plus inflation.

In seven years, the city’s tax haul has gone from $938 million in 2010 to $1.73 billion in 2017.

He said in theory, the city should be able to lower or maintain tax rates because more homes and businesses keep coming into the city each year, giving the city more revenue.

“The main reason we’re having challenges now is that council has been too focused on capital – using property tax dollars to build new infrastructure,” said Chabot.

He said before 2010, the previous council relied more heavily on federal and provincial grants to accomplish the same things or more.

He said council’s capital infrastructure plan has been too far reaching.

Nenshi disagrees, saying increase to tax rates each year have been to keep up with inflation.

Metro crunched some of the numbers provided on the city’s website. The blended tax rate, which homeowners see on their bill, has gone up 14.69 per cent since 2011.

Since 2011, the median residential property assessment has climbed from 410,000 to 460,000 – an increase of 12.1 per cent.

The median tax bill on that amount has climbed from 1,313.84 in 2011 to $1,823.12 in 2017 – a 38.7 per cent increase.

“Sometimes it’s ahead of inflation, sometimes it’s behind, but that’s us trying to figure out how to provide the services we provide today and invest in services people have asked for,” said the mayor. He said in his time as mayor, those increased services have mainly been transit service hours.

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