Oliver council debates business vs residential taxes | News

Town of Oliver council, like to many other small towns in British Columbia and across Canada, have again made it clear they continue to rely heavily on government grants from senior levels of government to survive and are worried much-needed projects won’t move forward if that funding ever dries up.

This was the message from John Kurvink, Oliver’s chief financial officer during a discussion on the 2025 draft budget Monday afternoon.

“To make the financial plan work, we’re assuming that — or projecting that — grants will be available to fund the expenditures on the capital side,” said Kurvink. “It’s really not on the operating side.”

Coun. Aimee Grice said she had concerns about so much of the budget being predicated on grants from senior levels of government.

“That’s a huge amount of grant reliance for 2026, especially if you look at previous years and future years,” she said. “So is the idea then that we would have to be looking at debt to fund those projects?  I’m just sort of wondering where we’re at in relation to our debt ceiling and what that might look like.”

Kurvink acknowledged there would have to be debt to tackle the various capital projects that have been projected projects.

“It would have to be debt or additional operating revenue or revenue through rate increases or tax increases,” he said.

The town “still has room” for further borrowing as some of the debt accumulated in prior years due to borrowing is coming off the books soon, he said.

“There is room there, but in terms of where we ranked when we looked across all of the municipalities and we’re kind of in the middle,” he said. “We’re definitely not debt free, as some are, but we’re not loaded close to the maximum, that debt ceiling, that debt limit, but we’re sitting in the middle.”

This is a situation shared by so many municipalities across the province, said Kurvink.

“It’s getting tighter and tighter to be able to make that balance work because you don’t want to take on too much debt, because then, as you know, you’re putting the debt on people over the next 20 years,” he said. “That’s the argument against debt  because if it’s an asset being used today, why should people pay for it 20 years forward?”

Coun. David Mattes said the only other obvious option is “project deferral, which is what we’ve done in the past” during difficult economic times. “These numbers are based on doing everything and we know that is just not possible.”

Council also has the authority to deny requests from staff for things like new equipment and delay those purchases for a year or two if necessary, said Mattes.

The five per cent property tax increase proposed earlier in the budget process remains intact, said Kurvink.

“Each point in taxation only generates, because we’re not a large municipality, about $28,000,” said Kurvink. “So by increasing the tax rate, it doesn’t generate a lot of money.”

The final revised tax roll increase proposed to local ratepayers will come out the end of March, he said.

“Based on this, you can see where we’re sitting in terms of a five per cent increase is about a $44 annual change (or about $3.50 per month per residential property owner).”

Mattes said one part of the budget he couldn’t agree with was a tax increase on a dozen “light industry” small business in the town that would see their business tax increase by $1,300 per business.

“When you do that, that’s about $15,000,” he said. “That’s all that we’re getting, but we’re really hammering those people at a $1,300 increase.”

Just under 300 small business owners in Oliver are looking at an 11 per cent tax increase in this proposed draft budget, which is more than double the five per cent for homeowners, which isn’t fair in his opinion, said Mattes.

Coun. Petra Veintimilla didn’t agree with Mattes’ synopsis of the taxation breakdown, saying that small businesses were being taxed at the higher rate because the latest assessment of their businesses showed they had increased dramatically.

“I don’t think it’s that we’re hitting those classes hard,” she said. “Those classes as just described had large increases in their assessed value this year, which is why the numbers are working out the way they are.”

The option of not contributing healthy amounts of funding to the town’s various reserve funds isn’t one she supports as most of the reserves are currently “largely unfunded” and don’t have adequate amounts, she said.

Dropping business taxes to the same five per cent increase would impact residential property owners and increase their percentage 5.9 per cent for 2025 or $61 increase for each residential property owner, he said.

Some municipalities in B.C.  attempt to keep tax increases for residential and business owners around the same rate, but that has not been the case in Oliver for some time and those were decisions made by members of previous councils, said Kurvink.

Mattes said another area of the budget that should be looked at more closely is taxes for recreation facilities like golf courses in Oliver.

“I think one of the things for council we really should be looking at is the recreation,” he said. “They’re actually seeing a drop in taxes …  recreation is not on this list and it should be.”

There are 29 campground properties listed under recreation, but their entire assessed value is $5.6 million, which is why they pay the taxes they are now being charged, said Kurvink.

“There’s not a lot of money there,” he said.

Grice said she couldn’t support any category of property getting significant tax rate cuts as “everybody is struggling right now …  and everyone has to pay their fair share.”

Looking at the overall rate increases on taxes and utilities, the bottom line is Oliver has some of the lowest taxes in the South Okanagan, said Kurvink.

“We’re going to be one of the lower cost jurisdictions,” he said.

Information from similar-sized towns like Invermere, Sicamous and Gibson’s were gathered during the budget process and it was found “there were some fairly substantial increases,” he said.

A public feedback period to allow for local residents to review the draft budget and provide input began on Tuesday and will continue for one month, said  Kurvink.

In late March, Oliver council will take one final look at the budget and discuss and finalize property tax and utility increases for 2025, said Kurvink.

Council will be voting to pass the tax increase bylaw only a few days before the May 15 provincial deadline, he said.

Revenue projections as part of the 2025-2029 financial plans calls for a five per cent increase to taxes in 2025 and three per cent annual increases for 2026, 2027, 2028 and 2029, said Kurvink.

Government transfers to the town include a one per cent tax increase to ratepayers each of the five years, he said.

The budget also proposes a four per cent increase in user fees each of the five years, which will bring in significant revenue to the town, said Kurvink.

These user fees are charges to use the Oliver Arena, local ball fields, to play soccer and other sports at local facilities.

The proposed water rate increase for 2025 is four per cent, which has already been adopted by council, and a five per cent increase each year for the next four years, he said.

“For the purpose of the financial plan, I put a five per cent increase every year (for water rates),” he said.

Sewer rates will increase by three per cent for 2025 and five per cent for each of the next four years, he said.

“On a summary level for the financial plan …  we have a $17.7 million (for 2025) budget altogether,” said Kurvink.

Amortization and principal on debt from borrowing is always factored into the annual budget projections, he said.

The budget includes all the financials relating to the difference in the water, sewer and operating capital budgets, as well as the annual proposed tax increases in each of these key areas, he said.

“So the financial plan that gets put into the bylaw …  is on an accounting basis,” he said. “You can see the numbers come up a little bit different.”Council voted unanimously in favour of a motion to bring the revised 2025-2029 financial plan forward to later budget meetings over the next few weeks following a one-month public input process.