Calgary city council makes cuts to proposed property tax increase

Budget talks at Calgary City Hall continue with council debating dozens of amendments to next year’s budget, with more than half of the proposed property tax increase already eliminated.

After a week of public feedback and questions from city administration, council officially began debating the budget on the sixth day of deliberations. Councillors brought forward more than 35 amendments and motions aimed at tweaking next year’s financial plan.

“It’s very clear that council is making the tough decisions, making sure that we’re living within our means while also funding the needed housing and safety investments,” Calgary Mayor Jeromy Farkas told reporters during a break Monday night.

The budget proposed an overall property tax increase of 3.6 per cent, but so far in the debate, council has whittled that down to 1.18 per cent.

The reduction was largely driven by back-to-back amendments that kick-started debate.

One of the amendments came from Ward 6 Coun. John Pantazopoulos, which aimed to draw $50 million in projected investment income to fund base operating expenses.

“It’s essentially taking those dollars that would flow into reserves and allocating it down for a temporary property tax reduction,” he told reporters.

The move was approved by council in an 11-4 vote, with councillors Landon Johnston, Myke Atkinson, Jennifer Wyness and Raj Dhaliwal voting against.

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Dhaliwal told reporters he had concerns with potential implications on the next four-year budget, which is expected to include major funding requests from the Calgary Police Service, Calgary Transit and the Calgary Fire Department.

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“We are betting on something we don’t know,” Dhaliwal said. “To me, that is like mortgaging on the future just to appease some people this year.”

The other amendment came from Ward 10 Coun. Andre Chabot, which cancelled a one per cent tax shift from commercial properties to residential properties with a unanimous vote by council.

The previous council approved an annual tax shift of one per cent to create “a more business-friendly tax environment in Calgary,” and reduce the ratio that businesses pay in property tax compared to homeowners. If that ratio hits 5:1, the provincial government is legislated to intervene.

According to city administration, the forecasted ratio without the shift is 4.60:1 in 2026.

Ward 4 Coun. DJ Kelly said there is more to come on the matter with a proposal for a lower tax shift of .25 per cent annually over eight years.

“I think the business community will be in a position where they actually like what it is that we put forward,” Kelly said. “And at the same time, we’ll be able to see residential property taxes go down as well.”

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Transit fares will be increasing beyond what was planned, after an amendment from Chabot, in an effort to generate $4 million more for Calgary Transit’s budget.

The move, approved in an 8-7 vote, would see fares increase on Jan. 1, 2026, with an adult single fare set to increase to four dollars. Councillors Nathaniel Schmidt, Rob Ward, Dhaliwal, Atkinson, Harrison Clark, Kim Tyers and Mayor Farkas were opposed.

Chabot argued the additional revenue generated from the fare increase could be used to fund other initiatives on transit.

“Yes, it is an increase in the fares,” Chabot told council. “But then we can look at how we can increase safety, security, cleanliness, something to provide some sort of increased level of service.”

Chabot also attempted to eliminate the downtown free fare zone to generate $5.2 million in revenue, as well as cut free transit for kids under 12, which would’ve generated an additional $3.6 million.  Both attempts were defeated by council.

There was also an attempt from Coun. Wyness to cut the Downtown Office Conversion Incentive Program to save $40 million, but that was also defeated by council. A later amendment from Coun. Schmidt lowered funding for the program to $35 million next year, which included a $10 million allocation to the city’s non-market conversion program.

However, some on council said the debate has been healthy so far, with councillors working together on various amendments.

“Look at the conversations and look who is sponsoring and bringing motions forward,” Pantazopoulos said to reporters. “This is our first budget and already we’re building bridges, we’re having conversations and we’re focusing on what’s important to Calgarians.”

Council will return to chambers on Tuesday morning to continue the debate.