City council will discuss lowering utility rate hikes

Tough economic times and success in finding savings could translate into smaller hikes in city utility bills for Calgarians for the next couple of years.

City council will discuss on Monday a proposal to reduce hefty increases in water, wastewater and drainage fees for both 2017 and 2018.

The reductions would save Calgary homeowners $88 next year and $190 the year after.

Council has already approved increases of 8.3 per cent for water and wastewater bills for both 2017 and 2018.

Hikes in drainage rates of 19.1 per cent were also coming for 2017 and 2018.

The substantial increases were deemed necessary to make up for years of keeping rates from fully covering the cost of system upgrades and service expansions.

Administration is proposing a 2.5 per cent increase in water/wastewater rates and a 7.4 per cent hike in drainage rates for each of the next two years.

City doesn't need as much money; spending to be spread out

Councillor Ward Sutherland, who is the vice-chair of council's priorities and finance committee, said the city doesn't need as much money as earlier thought.

There is a number of reasons for that.

First, revenues are starting to come in from the new off-site levy charged for development in newer areas of the city.

Second, the city has found savings in its operations following zero-based budget reviews and calls from council to tighten up on spending.

And the economic slowdown forced the city to re-think the rates to try to give Calgarians a break. Lower rates mean the city will spread out spending on the maintenance and growth of its utilities over a longer period of time.

No, it's not because of the election

Sutherland said the timing of the proposed reduction has nothing to do with the 2017 municipal election. He said cash from the new developer levy in particular gives the city more room to move.

"Without that agreement, it would be very difficult" to lower rates like this said Sutherland.

Rather than several larger rate hikes, Sutherland said he prefers small annual increases over the next few years.

Administration also examined freezing the utility rates. But it concluded that could pose too much risk for the city's finances.

City trying to cut costs for homeowners

If approved by council, this could be the latest attempt to help Calgary homeowners with city costs.

In June, council voted to freeze the municipal portion of property taxes for 2017. The provincial government won't set the education property tax until next spring.

Earlier this week, city council voted to waive the $6.50 monthly fee for its new green cart program which will be rolled out across Calgary next year. That new fee will not kick in until 2018.

A report going to city council on Monday indicates waiving that fee for 2017 will cost the city $13 million in revenues. It intends to cover that cost by using surplus money from last year that has been parked in its rainy day fund, the fiscal stability reserve.