Property taxes in Halifax must rise to handle the municipality’s growing population and ongoing projects, staff said Wednesday as the city began its budget season.
Financial staff told the budget committee that they expect a $1.3-billion operating budget and $318.8 million in capital spending for the 2025-26 fiscal year.
Nearly $70 million is needed to cover the gap in new spending compared to last year, and staff suggested raising the property tax rate by 2.7 per cent up to $0.791 per $100 of assessment.
That would see the average single-family residential tax bill with a home assessment of $338,500 rise by 7.6 per cent this coming year.
That jump would work out to an extra $189 a year, or about $16 a month, for an annual total of $2,678.
New Mayor Andy Fillmore, who campaigned on freezing the tax rate, said after the meeting he will look for ways to bring that increase down.
Councillors got a high-level view of what’s needed to balance the books and staff say property taxes need to go up to handle a growing population. Haley Ryan has the story.
“It’s not at all what I’m looking for,” Fillmore told reporters. “In the same way that households are doing more with less, the municipality needs to do more with less. And that’s the agenda that I’ll be pursuing through the budget process.”
Chief administrative officer Cathie O’Toole said staff have already cut as much as they can from the budget, so any more reductions will be up to councillors to find as departments bring their budgets forward over the next two months.
She said 11,000 new residents moved to the city last year, which means an increase in road and sidewalk maintenance and services like transit, police, fire and garbage collection to support those people.
“We have a lot of boots-on-the-ground … type of work that needs to be done, and as long as the assets that the municipality has to take on every year continue to increase, and as long as the population we have to serve continues to increase, there’s very little we can do,” O’Toole said.
She said cutting back services like waste collection or snow clearing is the only way to make a dent in the operating budget moving forward.
This is essentially a “transitional” budget, O’Toole said, with various projects and priorities decided by the past council and few opportunities for the new slate of councillors to make major changes.
The new council will set its own strategic priorities that will guide future budgets later this year.
The city has a zone-based commercial tax structure, with bills for business park properties rising 7.3 per cent, industrial parks by 13.2 per cent and the downtown by 7.4 per cent.
Fillmore said he will be looking at both the operating and capital budgets for places to make cuts, and is interested in diversifying the city’s revenue to rely less heavily on property taxes.
About 82 per cent of the municipality’s revenues now come from property taxes.
Some examples could include higher user fees for city services like recreation or transit, as well as sponsorships or partnering with other levels of government, Fillmore said.
Councillors will look for places to cut or add spending as departments bring budgets forward in the coming weeks. The public has an opportunity to speak before these budget committee meetings.
“It’s our responsibility now to find a project and put forward a motion … if you want to get it out of there,” said Coun. Shawn Cleary.
Departments to come before councillors in coming weeks
Public safety — which includes community safety, fire and police — will present its proposed budget Feb. 12. Operations, including Halifax Transit, public works, fleet, and planning and development, will follow on Feb. 19 and 20.
Some of the big-ticket items are street recapitalization ($52 million), the new organics facility ($8.3 million) and the Sheet Harbour fire station ($9 million).
The final budget will be decided in April.
Council approved a 6.3 per cent tax bill increase as part of an overall $1.3-billion budget for 2024-25.
