Provincial data shows Town's finances in good shape

Okotoks: Taxes, spending lower than similar-sized municipalities

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Okotoks Mayor Bill Robertson

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Okotoks municipal officials say provincial data shows the Town is in good financial shape compared to similar-sized municipalities across Alberta.

In a report from Alberta Muncipal affairs, Okotoks fared well with lower tax rates and spending and had comparably lower debt than some of the 19 towns and small cities studied by the Province.

The report looks at the years 2005 to 2010 and compares 19 municipalities across the province with populations between 9,202 and 24,646.

Jerry Ward, Municipal Affairs public affairs officer, said the provincial government collects the information and provides it to municipalities to assist them as they draw up their budgets. However, the Province doesn’t provide any rankings or further assessment of the data.

“It’s basically for budgeting purposes to show where they’re at,” he said. “We don’t say whether it’s positive or negative.”

Louise Wasylenko, Okotoks financial services manager, said the data shows Okotoks had a lower tax rates compared to similar sized municipalities. (What is the tax rate now in Okotoks. And what is it Cochrane)

The Town is also well below the pack for non-residential taxes. In fact, according to Wasylenko, the Town has the lowest non-residential rate among the 18 other communities included in the report.

She said the Town has been able to achieve lower taxes with a mix of keeping expenses down, borrowing money and using a variety of revenue sources, including grants and user fees. For example, the Town’s economic development department is fully funded by business license fees, while recreation programs are funded 65 per cent by user fees and 35 per cent by tax support.

Okotoks residents shoulder a small part of the Town’s overall tax revenues. According to the report, in 2010 the Town received 25 per cent of its revenues from property taxes, again below the mid-point of 31 per cent. The Town also has been more successful at accessing grants - it received 28 per cent of its revenues from grants.

“What we attempt to do is maximize what we can get out of grants, minimize operating costs so taxes are lower and have competitive (fees) and user charges and preserve our funds in reserve for major capital projects,” said Wasylenko.

The data also shows the town spends less than other similar sized communities.

In 2010, the Town’s total expenses of $1,500 per resident were below the $1,900 per resident mid-point and close to half the unidentified top spender who shelled out $2,700 per resident.

Wasylenko said the Town works to be efficient and exercise restraint on spending.

The Town has been able to achieve this while providing good facilities and a high level of service for residents, she added.

“I’m really proud of what we’re doing in terms of total operating cost,” she said.

The report shows Okotoks’s debt levels are similar to other municipalities looked at for the report.

Between 2005 and 2010, the Town was able to gain more room to borrow under a provincially set debt limit. The provincial government sets a limit for how much debt a municipality can take on, which changes each year as it grows.

In 2005, Okotoks’ debt was 73 per cent of the limit, while it dropped to 50 per cent in 2010

Wasylenko said Okotoks’ debt jumped in 2005 because it borrowed $20 million that year to expand the recreation centre and build the Centennial Arena. It then dropped by a million dollars between 2005 and 2010. However, the town can already anticipate a spike in their debt levels next year, however, after borrowing $2.4 million for the 32 Street bridge last year and will take on additional loans this year for the south emergency station and new fire equipment.

Wasylenko said the Town makes responsible use of debt to help pay for some projects.

“We incurred some debt to provide services for a population we know is growing,” she said.

It has been the Town’s practice to limit borrowing terms to half the expected lifespan of projects the debt is going towards.

Okotoks mayor Bill Robertson said this means the Town won’t have to make payments on a facility by the time it gets old enough to require higher maintenance.

“The sooner we can pay it off, the better we can manage the upkeep of it,” he said.

While Robertson’s pleased with how Okotoks compares in the report, he said the Town can’t rest on its laurels.

“The taxpayer is very demanding and they want to know not what you did for me yesterday, but what will you do for me today,” he said. “We still need to be aggressively managing the taxpayer’s money.”