Property tax rates go down, but increased assessment may mean an increase in taxes

By Rob Vogt
Property tax notices went out last week.
Tax rates will go down for ratepayers in the Town of Claresholm but taxes will still increase an average of 3.7 per cent for residential properties and one per cent for non-residential properties because assessment has increased due to inflation.
The 2024 rates will see a 7.4 percent decrease in the residential municipal rate from 2023 and a 2.6 percent decrease in the non-residential municipal rate.
After factoring in assessment value inflation, the estimated average real tax cost increases per property for residential properties is 3.7 per cent and one per cent for non-residential properties.
At its May 13 meeting, council passed the final two readings of its property tax rate bylaw.
Back at its April 22 meeting, Blair Bullock, the town’s director of corporate services, explained property tax is a main source of revenue for financing municipal operations. Property tax rates can be established once council adopts the annual operational and capital budgets and the annual assessment roll is prepared.
The tax rates are set annually. A property tax rate is calculated by dividing the tax levy required by the corresponding property assessment class or subclass. The 2024 property taxes are based on the 2023 property assessments as at Dec 31, 2023.
In addition to the municipal tax rates, municipalities must set tax rates to raise the revenue for any requisitions they are required to pay, such as the Alberta School Foundation Fund requisition and housing management body requisition.
Each tax rate must be identified separately on the tax notice.
The town has annexed additional land in the Town of Claresholm from the Municipal District of Willow Creek.
Part of these annexation agreements dictates those lands be taxed at M.D. tax rates for the next number of years or until the land is developed.
Bullock explained that as is noted in the 2024 approved budget, this tax-rate bylaw proposes a tax revenue increase for municipal purposes of 3.6 per cent over last year.
This is due primarily to significant inflation seen over the last two years.
However, significant inflationary assessment value increases have been seen this year, with upwards of 12 per cent in residential properties, and around five per cent for non-residential properties on average, so the town is looking at an actual real decrease in the tax rate.
The 2024 residential property tax rates are down 7.4 per cent from 2023 rates, and non-residential is down 2.6 per cent.
The tax-rate bylaw also dictates the tax rates for tax requisitions, including the Alberta School Foundation Fund, or education tax requisition, Porcupine Hills Lodge Foundation, or home for the aged requisition, and Designated Industrial Property Requisition.
Neither the town, or town council, has any control over these amounts or their corresponding tax rates.
They are determined simply by the requisitioning body and assessment values.
The education requisition is up 10.6 per cent for residential and 1.1 per cent for non-residential. With assessment inflation, this is a two percent decrease in the residential requisition tax rate and a 3.2 per cent increase for non-residential requisition tax rate.
The Porcupine Hills Lodge Foundation requisition is up 25.1 per cent for a tax-rate increase of 12.6 per cent. This rate is the same for residential and non-residential.