OUR VIEW: Make Taxes Fair, Keep Services

The scene at city hall last week was tense as council began hearing from almost a hundred citizens who had signed up to speak. The public gallery was jammed to capacity, and even the lobby of the third floor was in danger of overflowing.

Who could believe that hearings on the annual operating budget would produce this outpouring of public concern?

This year the City of Vancouver’s annual operating budget presents big challenges and tough decisions. Development revenues are down sharply due to the economic downturn and that means public services including libraries, engineering, parks and recreation, utilities, fire and rescue, and policing are all on the chopping block.

For the fourth consecutive year, Think City’s Citizen Budget survey asked Vancouver residents about their priorities for the city budget. Between November 6 and December 1, 2158 individuals completed our survey through our website. Although our survey attracted more than three times as many participants as the city’s own online budget consultation survey, the results are strikingly similar – Vancouver residents do not want to see cuts to the services they value.

Based on the demographic information provided by our participants, those surveyed were more likely to be older, better educated homeowners with higher than average household incomes when compared to the general Vancouver public, not unlike the readers of this newspaper.

The main budgetary questions on our survey involved budgeting priorities and policies, tax increases and shifts, as well as, alternatives for closing the $28.1 million budget gap.

Vancouver citizens place a high value on their libraries, cultural services, community centres, parks, streets, utilities and protective services. Libraries topped the list of priorities with 91.1 per cent saying the city should increase or maintain current service levels, followed by parks and recreation (87.5 per cent), civic grants (87.1 per cent), fire and rescue (86.9  per cent), utilities (86.8 per cent), community services (84.1 per cent), engineering (75.2 per cent), and police (64.2 per cent).

In fact, 47 per cent of respondents told us they are willing to accept a modest tax increase of three per cent to maintain quality public services, and a further 32 per cent said they would pay five per cent more. For the average homeowner with property assessed at $782,000, a five per cent tax increase in taxes and utilities would amount to $181 annually or $15 per month.

Instead, the city is proposing dramatic cuts that include permanently closing the Bloedel Conservatory in Queen Elizabeth Park, the children’s farmyard in Stanley Park, and the Vancouver Public Library’s Riley Park branch, while also reducing the hours of libraries and community centres across the city. 

Think City believes there are better choices. During the Vancouver services review, city staff made over a thousand suggestions about where the city could find cost savings. We believe the city should pursue these aggressively so these savings can be realized in future budgets. 

As well, the city should shelve the two-year-old annual tax shift from business to residential properties. In more prosperous times, this policy may have seemed like a relatively benign idea, but in the current economic environment it is divisive and possibly counterproductive. Increasing residential taxes over-and-above the amount required to maintain key services will only engender mistrust and cynicism among voters.

Although business is hurting, many families are in even worse financial shape. This unnecessary tax increase will hit homeowners directly and be passed on to tenants in the form of higher rents. It will make housing even less affordable, and reduce discretionary income at exactly the time retailers are hoping that consumer spending will pick up. Transferring the tax burden from one group of taxpayers to another during a recession is a classic case of robbing Peter to pay Paul.

To conclude, Think City is recommending city council:

1) defer the business tax break until the economy strengthens; and

2) raise property taxes across the board by three to five per cent to maintain key public services.

Our survey revealed Vancouver’s citizens are worried they could lose the quality public services we have all come to expect. The crowds at city council last week are just the visible tip of the iceberg.

Last year, when voters elected Gregor Robertson and Vision Vancouver as the majority party on council, they expected a government that would maintain our libraries, cultural services, community centres, pools, parks, streets and protective services. Now that real choices have to be made, Vision’s commitment to voters are at stake. It’s time to make good on those promises.

This editorial originally appeared in the Vancouver Sun on December 9, 2009.