Monday, July 25, 2011

Naheed Nenshi: Poetic Tax Grab

Naheed Nenshi: Paying The Poet

So, here's a little tidbit to outrage the Calgary tax payer.

You may have heard that city council boosted property taxes this year. The funny thing is, council announced a 4.4% tax hike. But guess what? You'll actually be paying an additional 10%.

And it's quite sneaky the way they did it. Here's how:

Each year, city council approves the budget for the next fiscal year. In doing so, council decides what the property tax rate needs to be to create a balanced budget. Through natural inflation and depending on what spending projects are on the books for the next year, this typically includes a tax increase. This is the same for every city in Canada.

Usually, anything more than 4 or 5% increases causes vocal outrage from the public, so council stayed within the "safe zone".

Additionally, the city is responsible for collecting a nominal charge from property taxes and giving it to the Alberta government to pay for province wide education. This creates a situation where the city sometimes has to "guess" what the provincial tax rate will be, since the city's budget is completed before the province's budget. To this effect, city council collects these fees in addition to it's announced tax hikes.

As it turns out this year, council grossly overestimated the amount of money which was needed to pay the province for education. In fact, it collected an additional $42 million from property owners. Roughly $40 for EVERY man, woman and child in the city.

The Alberta government was rather responsible, and told the City of Calgary that the money did not belong to the province, and was not needed for the budget. So, tax payers were expecting to have the money returned on their next property tax assessment.

Not so. Council passed a motion a couple months ago, allowing them to NOT refund the money, and keep it in a separate fund to be used for "capital and infrastructure" projects for the next 30 years.

That's kind of dirty, no? No. What's REALLY dirty, is that this handy little motion that was passed allows the city to do this any year where provincial taxes have been "overestimated" for the next 30 years.

How cleaver! So in addition to the 4.4% tax hike levied on us by the city, we actually paid an additional 6% for the province that was not needed or required, and the city gets to keep it all!

Now the next question would be: how often do we think the city will UNDER estimate the provincial tax rate? My guess is probably never.

Now forgetting all of that, let's look at the most recent bout of stupidity by city council. A Poet Laureate! Naheed Nenshi and council decided that a valuable use of taxpayer dollars would be to hire a full time poet! You know, so that we can have original poetry at hand for special events or city functions.

Clearly, this is a necessary service that the citizens of Calgary cannot live without! And how handy that they now have a $42 million slush fund to pay the piper (ahem... Poet) with.


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