Vancouver, November 5, 2009 – As municipalities across the province consider property tax increases for 2010, the Canadian Federation of Independent Business (CFIB) has released its second annual BC Municipal Spending Watch today showing that municipal operating spending continues to outpace population and inflation growth by a wide margin.
The study found that between 2000 and 2007 (the last year data is available) municipal operating spending across BC grew by 44 per cent, while population and inflation grew by only 25 per cent. Of 153 municipalities, 129 were unable to keep operating spending growth to population and inflation.
“This kind of spending is disrespectful to taxpayers and harmful to communities,” said Laura Jones, CFIB’s Vice President for Western Canada. “It means property taxes and other municipal fees increase faster than the ability of residents and business owners to pay.” If local governments had kept spending increases in line with population and inflation, taxpayers would have been left with an additional $572 million in their pockets in 2007. Put another way, property taxes could have been 14 per cent lower, leaving families more money to save and businesses more money to invest.
Twelve of BC’s largest municipalities spent more than double (2.00) population and inflation growth: Prince George (2.89); North Vancouver District (2.82); West Vancouver (2.80); Port Coquitlam (2.73); Penticton (2.58); North Vancouver City (2.54); Langley City (2.30); Vernon (2.21); Chilliwack (2.21); Maple Ridge (2.13); Coquitlam (2.10); and Langley District (2.09). Prince George had the greatest improvement in fiscal sustainability since last year while Mission saw the largest deterioration. The study finds that municipal wages are a substantial driver of municipal spending, with municipal employees earning 35 per cent more in wages and benefits than they would make in an equivalent job in the private sector.
“This is a wake up call to taxpayers. It’s time to demand more accountability from municipal governments—we have a number of recommendations including creating a Municipal Auditor General and restoring the business vote,” concludes Jones.