Vancouver Mayor Ken Sim says a 10.7% property tax hike is possible

City of Vancouver garbage collection. (City of Vancouver)

When the dust settles after Vancouver City Council approves its amendments to the City of Vancouver’s 2023 operating budget, the average property tax hike for residents and businesses this year could reach 10.7%.

This is higher than the 9.7% hike that City of Vancouver staff proposed in their report to City Council last week ahead of today’s first public meeting date to review the proposed budget details.

In a press conference this morning, Mayor Ken Sim made the announcement that revisions through amendments by City Council could lead to an increase into a double-digit rate increase.

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City staff’s 9.7% increase is based on a combination of factors, specifically cost inflation increases, additional funding to the Vancouver Police Department (VPD) including new additional police officers, the need to replenish the municipal government’s depleted emergency contingency fund reserve, and accelerating the replacement of aging infrastructure, especially sewers.

Sim says his ABC Vancouver party will propose increases beyond 9.7% that will be directed to improving core services — for “better quality sidewalks and roads with fewer potholes, consistent garbage pick-up, cleaner streets and more frequent cleaning of public spaces, properly maintained green spaces, revitalized neighbourhoods, resilient government finances, and for the first time in over a decade, properly funded police and fire services.”

The City’s standards for delivering core services to residents and businesses have fallen.

The Mayor says these core services of the municipal government have been underfunded for many years by previous City Councils, and taxpayers will receive actual service improvements in exchange for the increase in property taxes. As well, he suggests past major property tax increases were largely directed towards non-core services that are beyond the responsibility of a municipal government.

“I know increases like this are hard. Frankly, they suck,” said the Mayor. “We completely understand that, nobody likes property tax increases. However, leadership in government sometimes means making incredibly hard choices.”

Sim suggested such significant property tax hikes will not become a norm, adding that for the time being, there is a lot the municipal government needs to catch-up on from both the pandemic’s impacts — increased pandemic-related costs and deferred spending — and the spending choices of the City’s previous political leadership over the past decade.

The largest new additional expenditure that will be added by ABC Vancouver through amendments will be $4.2 million for 33 additional firefighters. Fire Rescue services have been severely strained from the volume of calls they receive to attend to incidents related to the worsening mental health and addictions crisis.

A further $3.6 million will go to the VPD, including $1.2 million for communications and evidence management technology, $450,000 for additional community policing, and $200,000 for a pilot program to have officers wear body-worn cameras, which was a specific election campaign promise.

Other added budget items include $1.8 million annually for snow clearing, $1 million for additional road maintenance, pothole repairs, and horticulture, $400,000 to fulfill the provincial government’s new requirements on accessibility including the hiring of a new language specialist, $186,000 for additional cleaning of public spaces, about $100,000 for Vancouver Public Library to hire one worker to provide staff training in crisis prevention and intervention, and $100,000 to enable City staff re-skilling to increase the number of positions.

In their report prior to today’s meeting, City staff suggested an average property tax hike of 8.6% annually would be needed between 2023 and 2027 due to the headwinds of continued high inflation and growing cost pressures. Over the same period, the City’s operating revenues and expenditures would go up by an average of 7% annually. In 2024, the City’s operating expenditures will reach and cross over the $2 billion mark for the very first time — 13 years after it reached and crossed the $1 billion mark.

These are the City of Vancouver’s historical average property tax increases:

2022: 6.35%
2021: 5.0%
2020: 7.0%
2019: 4.9%
2018: 4.2%
2017: 3.9%
2016: 2.3%
2015: 2.4%
2014: 1.9%
2013: 1.5%
2012: 2.8%
2011: 2.2%
2010: 2.3%

The City of Vancouver is not alone in its major property tax hike for 2023, as many other Metro Vancouver municipal governments are also facing the same type of inflationary cost pressures. The City of Surrey, for instance, is proposing a 17.5% property tax hike this year.

City Council is expected to finalize the 2023 operating budget and property tax rate increase in early March. The City’s separate capital budget for funding new and improved facilities and infrastructure was approved last year.

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