Town draft budget carries six percent increase

By Mickey Dumont Local Journalism Initiative Reporter

A Town of Claresholm draft operating and capital budget for 2025 proposes a 6.045 percent tax increase.
“This is an interim budget to allow the town to continue to operate into the new year,” said Jennifer Place, town director of corporate services, in introducing the financial document at the Dec. 9, town council meeting.
“The budget is a forward-looking projection for the upcoming year, based on current data and informed assumptions,” Place said. “While the budget is inherently subject to uncertainties, the administration strives to mitigate these risks by relying on the most accurate and up-to-date information available and by adopting a conservative financial strategy. However, there are certain budget factors that are beyond the town’s control, which must still be considered.”
Many factors have affected the town’s 2025 budgeting process.
Those include the federal carbon tax, inflation and interest rate uncertainties, a union contract with an annual 2.5 percent increase, equating to $125,215, and hiring personnel while government grant programs, amounting to $125,710, disappear.
The 2024 town tax support was $3,881,379. The 2025 proposed tax support amount is $4,116,015, a difference of $234,636 or 6.045 percent.
“While an increase is necessary, administration is aware that council remains mindful of the economic pressures faced by residents and businesses in Claresholm,” Place said. “However, the town is also facing the same inflationary influences in addition to its operational requirements, and capital needs, resulting in the proposed tax increase.”
In 2024, council approved a 3.6 percent increase in tax support.
“At this time, the 2025 interim budget includes an anticipated 6.045 percent increase. Much of this increase is due to changes in net salaries and benefits, the phase-out of the SILP grant (ending in March 2025), and the addition of a new transfer to capital reserves for recreation facilities in the amount of $50,000, accounting for 1.288 percent of the overall tax support increase,” Place explained.

“Council has implemented the reserve transfer following the 2024 recreation and cultural facilities survey. Within the survey, council had proposed the addition of a reserve transfer in the amount of $360,000, approximately a 10 percent increase to taxes in 2025. Upon review of the survey results, council made the decision to move forward with implementing the recreation transfer but at a lower amount with gradual annual increases in an effort to ensure manageable and consistent tax increases.”
Quarterbacking his second budget and seventh since being elected to council in 2017, Mayor Brad Schlossberger says homeowners “probably aren’t going to like it.”
“But we’ve heard loud and clear that we need a peace officer in town. That’s going to take up about two to two and a half percent of that six percent increase. I think we were at just over three percent last year and even lower than that the year before. During COVID, we kept it as low as possible,” the mayor said of his council’s work to keep taxes down.
“On the flip side, we’re also undertaking a lot of road repairs and other infrastructure work. If you look at the capital budget, we’re doing a lot.”
Highlights in the proposed capital budget include $530,000 at the water treatment plant, replacing waterlines and paving at the Agriplex for $700,000 and $265,000 for a new backhoe.
“It is a difficult budget,” said the mayor. “But what do you do? Do you say ‘okay, we’re not going to raise taxes, but we’re also not going to fix any infrastructure either. No new sidewalks’. You have to find a balance and, so far, this budget is it.”
With a proposed tax increase almost double over 2024, the final increase will not be known until April when council approves its final budget. It could change.
“We don’t know the answer to that yet, because we don’t have the (provincial) assessments in,” Town of Claresholm Chief Administrator Officer Abe Tinney explained. “Once we have the assessments, we can determine what kind of tax increases we will need to support the budget. Final budget is passed in April. Assessments likely won’t be available until February, 2025.”
The town has had to increase user fees to keep the proposed tax increase from creeping over six per cent.
User fee increases include utility rates, franchise fees, fire response, recreation and cemetery fees.
The budget report states, “as outlined in the 2024 budget, all municipalities in Alberta are required to annually submit audited financial statements and other relevant information to Municipal Affairs, a provincial government ministry. Municipal Affairs compiles, analyzes, and assesses this data against various performance indicators, each with an established benchmark.”
“If a municipality fails to meet one or more of these benchmarks, it is flagged. A municipality can be flagged for any or all of the 13 indicators, and the severity and consistency of these failures may result in a municipal review or even intervention,” Place said.
“The Town of Claresholm consistently meets or exceeds all of these benchmarks, except for one: infrastructure age. This is measured by the amortized book value of tangible capital assets relative to their original cost. The town’s lower rating for infrastructure age is primarily due to limited community growth, but also reflects the deferred maintenance of aging infrastructure, which may be at risk of failure. This challenge stems largely from insufficient funding to replace or maintain these assets.
“Critical areas of concern for the town include transportation infrastructure (streets and sidewalks), recreation and cultural facilities.”
“The infrastructure age and maintenance is something we are working on improving,” Tinney said. “Within the last few years, the council adjusted water rates, which has provided us with reserve accounts so we can make improvements to water and wastewater infrastructure. With this budget, council has committed $50,000 for recreation and cultural facilities reserve, which is the first-time council has done this.”
“This is a summary and not all the folks get a chance to look at how this all comes together. It’s a lot of work,” Coun. Rod Kettles noted. “I don’t know if anybody’s particularly happy that we are looking at a six percent budgeted increase but I think it strikes a balance between good management of the town, it reflects still a little bit of provincial downloading onto us, you know loss of grants and we didn’t come by it lightly. I don’t want it to appear that this was quick and dirty. This took some time.”