New Housing Adds Additional $8.2M to Edmonton’s Treasury

City economist Felicia Mutheardy said more completed units means more money coming in through taxes.

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New construction and rising real estate values ​​in Edmonton last year will add $8.2 million more than expected to the city coffers.

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More construction projects — mainly new homes — started and finished construction last year than the city had expected, administrators told the city council on Tuesday as it revises its 2022 budget. The city-wide increase in property tax of 1.9 percent that ended autumn is fixed is unchanged.

City economist Felicia Mutheardy said more completed units means more money coming in through taxes.

“Low interest rates, growing demand for more space and to some extent a slower response to existing supply in the home market contributed to much stronger housing construction than we expected,” Mutheardy said.

Changes in zoning, new construction and lot division are all part of rating growth, which is separate from market forces such as supply and demand.

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While housing demand is expected to remain strong this year, other factors mean construction could slow, Mutheardy said.

“Interest is rising. Construction costs have also risen, acceleration is beyond what we have seen in the past, and supply chain disruptions are still impacting the availability of certain materials needed for construction,” she said. “We think the pace of construction will be negatively impacted, at least in the short term.”

The city’s 1.9 percent increase in property taxes amounts to 1.4 percent for municipal services, 0.3 percent for alleyways remodeling, 0.1 percent for the Valley Line LRT and 0.1 percent for the Edmonton Police Department ($1 million increase).

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An ordinance will be submitted later this month to finalize the rate. Tax returns will be sent to property owners on May 24. Payment is due on June 30.

Transit shortage covered

The $66.9 million transit funds from the provincial and federal governments are also helping the city make up for money lost during the COVID-19 pandemic last year due to a drop in passenger numbers.

Mayor Amarjeet Sohi said that without this money — and though it’s $13 million less than requested — Edmonton should have scaled back both bus and LRT service by the end of the year.

“We wouldn’t have been able to provide public transport at the level we do now because we didn’t have the money,” he told media outside the council chambers. “With this money, we can continue our transit system and operations and allow more people to return to the system.”

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The Council is also looking at other ways the city can raise money for transportation, such as through parking fees or receiving a portion of the county’s motor fuel tax.

Women’s shelters get $880K

Meanwhile, the city voted on Tuesday to give women’s shelters a one-time boost of $880,000 with funds initially set aside to increase the police budget.

About half of the money goes to nursing costs. The rest will help those insecurely housed because of their immigration status, and provide both mental health and cultural support, according to a staff report.

count. Jo-Anne Wright said that domestic violence affects society as a whole and that it is not just a women’s issue.

“Shelters continue to be a safe haven for those fleeing domestic violence, helping to transform not only the lives of those they serve, but the entire community,” she told the city council.

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Wright was surprised to see that in many cases children are taken to these shelters in Edmonton.

“To include this in the overall affordable housing strategy offers families an alternative to those who live in abusive relationships. I think we need to continue to advocate for provincial government, and also (on) a one-off basis, addressing the needs of support these shelters.”

Problem features plan continues

Councilors also voted to give Edmonton Fire Rescue Services $850,000 to conduct a year-and-a-half pilot with the Community Property Safety Team on Tuesday. Firefighters have already started fighting dilapidated buildings that pose a fire hazard.

The city is also now allocating $915,000 to further ramp up its efforts to address so-called “problem properties” that create nuisance and safety concerns for neighborhoods, including people who live in them. Last year, another 251 vacant and dilapidated buildings were added to the city list.

lboothby@postmedia.com

@laurby

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