CALGARY -- The City of Calgary says it's losing between $10 million and $15 million each week as a result of the COVID-19 pandemic and administrators are warning that without financial support, the total could climb to more than $400 million over the next six months.
Calgary Mayor Naheed Nenshi is now calling on the federal government to step in with a support package, given that both his city and the province are already suffering major financial losses.
“Without a backstop from the federal government toward cities’ operating budgets, there are going to be significant challenges across the country, nowhere more than Calgary,” Nenshi said.
The mayor adds that the only major sources of revenue income are property taxes and user fees.
Calgary councillors have already voted in favour of deferring property tax and utility payments for residential and non-residential property owners for the next three months, but more pressure is looming.
Nenshi notes that taxes could be even higher for Calgarians if the city were to run a deficit. He adds that Ottawa is able to borrow money at near zero per cent interest and many cities will be relying on the feds for help.
“Ultimately the federal and provincial governments have a lot to do and I’m not being critical,” he said.
Meanwhile, the Canadian Taxpayers Federation (CTF) is calling on city council to take a hard look at their budget and find savings line by line.
CTF Alberta director Franco Terrazzano suggests Calgarians would only be paying higher federal taxes if Ottawa stepped in to help.
Instead, he wants administration to identify what is non-essential and what funds could be used for savings.
“Since the initial downturn occurred the city’s budget has increased by hundreds of millions of dollars, so the city is not a lean machine,” he said.
“They need to cut the corporate slush fund, there’s $76 million there that Calgary councillors should be using either for savings or direct tax relief for Calgarians.”
The fund Terrazzano is referring to is the Opportunity Calgary Investment Fund, which is used to attract competing businesses to the city.
The CTF is also suggesting that the province find more savings through MLA pay cuts.
“It shows Albertans that our leaders are wishing to share in the tough times, and another big consideration is that we are going to be facing, like the Ppemier says, a ‘fiscal reckoning’ in the future,” Terrazzano said.
“So before they’re able to implement those tough decisions they need to show the bureaucracy that they’re willing to make tough financial choices for themselves.”
The CTF estimates an MLA pay cut would save the province about $1 million. The taxpayer watchdog hopes Alberta MLAs will bring their pay in line with the Ontario average, which would still see them making around $100,000 per year.
