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The city expects the current combined $48 million assessed value of the now-closed Con and Giant Mines will drop by $10 million next year, meaning a $159,000 shortfall in tax revenue. - Christine Rudolph/NNSL photo illustration

Falling mine revenue may mean tax hike

Mike W. Bryant
Northern News Services

Yellowknife (Dec 01/04) - City Hall is proposing a property tax increase of nearly nine per cent over the next three years.

Closed mines, a growing population and aging infrastructure are stretching the city's ability to provide services under current revenue levels, according to the draft version of the 2005 City budget, released Monday.

NNSL photo

Highlights 2005 city draft budget

  • Total budget recommended: $38,790,000
  • Budget expenditures approved for 2004: $38,313,000
  • Forecast expenditures for 2004 so far -- $42,249,000.
  • Property tax increase of 2.85 per cent next year; "similar increase" for 2006 and 2007.
  • $1.50 increase per household on solid waste levy, effective Jan.1, 2005.
  • Five per cent hike to city water rates, effective Jan.1, 2006.
  • $118,000 for 2.33 new job positions for Multiplex, public works, and pool maintainer.
  • $1 million to build water booster station to support development in Phase VII and VII of Niven Lake subdivision.
  • $9 million for other capital projects, including waterfront development and trails on Twin Pine Hill.
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    Mayor Gord Van Tighem said city council's aversion to increased taxes in recent years has pushed the City into a position where avoiding a hike is no longer possible without slashing services.

    The proposed budget calls for a property tax hike of 2.85 per cent next year, and "similar increases" for 2006 and 2007.

    The City says without the 2.85 per cent increase next year, Yellowknife will be looking at a tax shortfall of $443,000.

    Total revenues expected by the city next year comes to $38,790,000, with expenditures of $38,301,000.

    The document also proposes a $1.50 increase per household on the $10 solid waste levy, effective Jan. 1, 2005; plus a five per cent water rate increase by Jan. 1, 2006.

    The city is predicting the combined assessed property value of the now-closed Con and Giant Mines will decline by $10 million next year from $48 million, translating into $159,000 less in tax revenue.

    "I've been warning people that as you grow it catches up with you," said Van Tighem, adding that even if next year's 2.85 per cent proposed increase passes, the city will still be scrambling to find money to provide services.

    "What that draft budget is, is basically a status quo," Van Tighem said. "Taking into consideration council's goals and objectives from earlier in the term, and initial budget consultations in June, this is what's been produced."

    If passed, the proposed property tax hike would be the first one adopted by council since 1999 when they approved a 3.7 increase.

    That increase was reduced by two per cent the following year after council learned it wasn't going to lose as much tax revenue from bankrupt Giant Mine as originally thought.

    Property tax increases have been proposed every year since, but cost-cutting councillors won the debate every time.

    This year's 0.7 per cent increase was scrapped this summer after the city received the $684,000 GST rebate from the federal government.

    Coun. Alan Woytuik said he thinks there is still room to manoeuvre this time around, and avoid a tax increase.

    "I think there's things we need to be looking at besides just saying, 'we need more money to keep doing what we're doing'," said Woytuik.

    Fill Giant with city garbage

    He said one area the City could save money is to dump Yellowknife's garbage into the open pits at Giant Mine.

    The City's attempt to buy more time at the landfill site -- which is nearly full -- by bailing garbage is a waste of money, Woytuik said.

    "Just about anybody you talk to on the street comes up with the same question: 'what about those pits at Giant Mine?'" said Woytuik.

    "They're an eyesore. It's an area that's contaminated and will never be used for residential."

    Coun. Wendy Bisaro said the City should've raised taxes a couple years ago to avoid a bigger hit that's apparently on the way.

    "I'm not surprised this has come forward," said Bisaro.

    "I don't know if there's anything we can do to mitigate what administration is suggesting. My gut feeling is no there isn't."

    Council will hold a special meeting Dec. 13 to hear presentations from the public about the budget.