Port Moody pitches 8.52% property tax increase ahead of budget deliberations

It’s budget season in Port Moody, and city council is looking to cut down on its potential property tax increase again.

Over two finance committee meetings in October, council was able to whittle down staff’s initial 10.85 percent increase to 8.52 percent, but Mayor Meghan Lahti said she still thinks there is more work to do.

“We have some wiggle room there, and I want staff to do a little bit more analysis,” Lahti said. “We’re in a very, very tough situation this year.”

Heading into official budget deliberation on Nov. 17, the city proposes to collect an additional $4.98 million, totalling $63.94 million in 2025. This equates to around $248 more annually for the average Port Moody household. 

Port Moody property owners have faced significant tax increases over the previous two budget cycles, amounting to a 6.6 percent increase in 2024, and a 9.29 percent increase in 2023. 

Staff listed numerous financial pressures facing the city in 2025, including inflationary impacts on costs, transportation, insurance, construction, software maintenance, and contracted and professional services.

Paul Rockwood, general manager of finance and technology, presented a slide showing the city’s 2025 operating expenses in 2025 have increased around 30 percent since 2021 due to inflation, and recovery from COVID-19 austerity budgets.

While the Bank of Canada has begun to cut interest rates, staff said this will not immediately relieve pressure on the city, as wage settlements need to be negotiated with unions that have collective agreements expiring this year.

The city is also having to respond to costs related to emission reduction, affordable housing, childcare, mental health, and homelessness; issues which have been downloaded onto municipalities from senior levels of government, according to staff.

And while Port Moody is becoming known as a regional destination, staff said its many visitors and newcomers are putting pressure on its services; the costs of which are not reciprocated by neighbouring municipalities.

“Despite this growth, Port Moody is not generating sufficient revenues to keep pace with the increased pressures on its services,” the staff report stated.

Around four percent of the property tax increase is the result of increases to salaries, wages, and benefits; 2 percent is related to a bump in the police budget, and another 2 percent reflects transfers to the city’s capital asset and climate action reserves.

While the city is expecting to see a $1.8 million increase in revenues in 2025 – mostly related to development and construction, grant revenues, program and user fees – the bulk of this money is being transferred to reserves.

The budget has a total of $26 million planned for proposed capital projects in 2025, and $82.5 million by 2029, which are to be funded through reserves and other external sources.

Topping the list for the most expensive project in 2025 is the implementation of the Old Orchard Park Master Plan, calculated at $3.4 million.

Most of the capital expenses, however, relate to infrastructure asset renewal. Maintenance to the water network, sewer, storm drainage, and roads alone total $7.7 million.

While most city reserves are balanced by the end of the five-year financial plan, many have significant opening balance deficits, and will remain in the red until 2029.

For instance, its combined asset reserves – used to replace existing infrastructure – are projected to run a $3.9 million deficit in 2025, a 4.1 million deficit in 2026, a 3.1 million deficit in 2027, a $300,000 deficit in 2028, before a $3.9 million surplus is achieved in 2029.

Rockwood commented that asset renewal is cyclical, and the city is still dealing with a backlog of maintenance challenges.

Utility fees are also spiking 12.3 percent, equating to an additional $206 annually for single family homes.

Staff said this is partly the result of service impacts to accommodate growth and increased demand, and partly a consequence of Metro Vancouver’s new levy related to the over budget North Shore Wastewater Treatment Plan.

Council and staff weighed numerous avenues for reducing the property tax increase, including re-assessing how much development money the city expects to see, and reducing the amount transferred to its climate action reserve.

Lahti acknowledged that staff prefers to be conservative regarding anticipated revenues from development, but said she thought more should be projected in the budget.

“2025 is not going to be our top year,” she said. “I personally feel like we need to do it because I think there’s more room there, I really do.”

On Oct. 28, the city released its budget survey, which will be open until Nov. 15 to gauge public opinion on the proposed increases. Municipalities need to set their final tax rates by May 15 each year.