City Debt, Taxes Higher Than Average — Report

Frontier Centre, Local Government, Media Appearances, Uncategorized

St. Albert is saddled with more debt and residents pay higher taxes than the average among larger Canadian municipalities, a new report suggests.

The Frontier Centre for Public Policy released last week a financial analysis of 79 Canadian cities. The report, which calls for greater consistency among municipal financial reporting, found St. Albert property owners paid 18 per cent more in taxes per household last year compared to 10 other prairie cities.

“The one thing that’s noticeable is the emphasis on taxation, as opposed to user charges,” said study co-author David Seymour. “The users’ charges are 35 per cent below [average].”

St. Albert property owners paid $2,707 per household in net taxes last year, a number that does not include the provincial education levy. User charges raised $1,600 per household.

Seymour noted St. Albert spent significantly more on culture and recreation last year, 40 per cent higher than the regional average.

“Recreation and culture are often things that people actually could choose to pay or not pay for,” he said.

The report also found St. Albert’s long-term debt is 20 per cent above the regional average for cities like Edmonton, Calgary, Winnipeg, Medicine Hat, Red Deer and Grande Prairie.

That long-term debt of $3,262 per household last year was also higher than the Canadian average of $1,423.

St. Albert has $71.3 million in outstanding debt, about half the maximum allowed by the province. The city’s debt will increase another $8.2 million next year to finish off stages one, two and three of Ray Gibbon Drive.

However, corporate services general manager Dean Screpnek said the city will pay off all of its debt aside from the road and Servus Place within the next five years, including utility debt in 2009.

Overall, St. Albert’s operating expenses were eight per cent below the regional average. The city also has 15 per cent more capital assets and scored favourably for accountability standards and compliance.

Mayor Nolan Crouse said few results were a surprise, except for St. Albert scoring poorly for reporting standards. “It comes across like we are not disclosing,” he said.

Seymour explained the score is because St. Albert’s 2007 financial statements were not posted on the city’s website.

“The only way you can change the city is to vote every three years. It’s hard to do that when you’ve got a city that doesn’t seem to be committed to posting its latest annual report on its website.”

The full report can be found at www.fcpp.org.