The value of homes and businesses in Dawson Creek has flatlined after more than a decade of growth, creating new fiscal troubles for the city.
According to a report from the city’s finance department ahead of its 2017 budget, residential and commercial assessments are trending down for the first time since the early 2000s.
The city expects to see a decrease of $12 million in its overall assessment base in 2017—compared to a $43 million increase in 2016, city councillors heard at a Nov. 21 meeting.
City staff anticipate a 1.3 per cent drop in residential assessments, while growth in commercial assessments has slowed to less than one per cent.
The issue is two-fold. Construction of homes and businesses in the city has slowed with the downturn in oil and gas investment. Meanwhile, increases in the market values of properties are flatlining. The average single family home in the city, for example, is expected to lose about $1,135 of its assessed value—dropping from $256,194 to $255,059.
Dawson Creek’s population has hovered around 10,000 people for decades, but the value of properties has surged since oil and gas activity picked up in the early 2000s.
Between 2001 and 2016, the taxable value of residential properties in Dawson Creek climbed from $287 million to $1.24 billion dollars. In that time, nearly 800 residential folios were added to Dawson Creek’s tax roll, many of them new homes.
Commercial assessments, meanwhile, climbed from $76 million to $470 million as new businesses opened in the community.
The assessment gains were driven largely by new construction and corresponding increases in the assessed value of existing homes and businesses. Over the years, the city adjusted its tax rate to avoid larger bills for long-time residents.
With assessments down, Chief Financial Officer Shelly Woolf told council to expect a lean budget next year.
“There’s going to have to be some prioritizing and focusing with the assessment figures that came in,” she said.
Earlier this month, council adopted a “stewardship statement” emphasizing the city’s difficult fiscal position.
Council expects the future quality of life in Dawson Creek “will be compromised” if "current trends in revenues and spending are not changed,” the statement reads, while “revenues are not growing fast enough to fund predicted future expenditures, especially for necessary infrastructure.”
Council is considering a “range of solutions” to improve the city’s finances, including tax increase and spending cuts.
Woolf said the statement will be top of mind as the city prepares next year’s budget.
“It’s going to come up again, and again, and again,” she said.
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