Village of Alix mill rate cut to counter hot real estate market

Alix village council voted to cut their mill rate to counter a huge spike in the municipality’s property values. The vote was held at the April 3 regular meeting of council.

Councillors read a summary of the 2024 operating budget from Chief Administrative Officer (CAO) Michelle White, that also contained a detailed description of a massive hike in Alix’ assessed property values and the effect that could have on property owners’ tax bills.

“The budget being presented includes a reduced residential mill rate for municipal taxes,” stated White in her report to council.

Readers may not be familiar with the arcane methods used to calculate property taxes, but essentially councillors set a mill rate which then combines with a property’s assessed value to arrive at a final tax bill.

Properties tend to be taxed for the way they are utilized, for example, residential or non-residential.

Under this method, a municipality may keep its tax rates the same year to year but if property’s assessment increases, or in Alix’ case spikes, taxpayers may still receive a hefty bill in the mail.

“Supporting documents in your agenda pack show an 8.8 per cent increase in residential assessment from last year, mostly due to inflation,” stated the CAO’s memo. “If the mill rate were kept the same as it has been since 2017, residential taxes would increase by $72,356.84 from last year.

“This does not factor in the new minimum tax levy changes.”

The CAO included a chart that essentially showed tax revenue increasing since COVID declined in 2022, as she stated, owing to inflation.

After further discussion the CAO noted assessment rose after COVID, “…because the housing market went nuts.”

Councillors spent a considerable amount of time discussing the spike in assessment; the CAO went on to explain that it is nice to see property values increase in the village but if councillors kept the same mill rate as last year the typical residential property owner in Alix would see their tax bill go up by about $400 over 2023.

The CAO further noted Alix has also seen an increase in assessment of about $1.2 million; Coun. Tim Besuijen asked if this was new development or improvements on existing developments and the CAO confirmed it was both.

Further, the CAO stated 8.8 per cent is at the high end of growth for a community Alix’ size, but White added most communities are seeing assessment growth.

The CAO stated that if councillors decided to leave the mill rate at its current level, more tax revenue would be collected and that money would probably be put towards the village’s current lagoon rehab project.

However, Mayor Rob Fehr stated the roughly $70,000 wouldn’t really make a dent on a project in the millions of dollars.

The CAO acknowledged the effect a spike of at least $400 on tax bills and suggested councillors consider lowering the mill rate from its 11.2565 level to a new 10.5836, essentially keeping Alix residential tax bills comparable to 2023.

Coun. Besuijen agreed keeping the mill rate the same was too much of a hit on the residential taxpayers and was in favour of cutting the rate.

“If we can help out, I think it’s awesome,” said Besuijen.

The CAO noted cutting the mill rate would also make Alix more comparable to nearby communities such as the Village of Clive, that has a residential mill rate of about nine.

Mayor Fehr stated he also was in favour of cutting the mill rate because he wants Alix to attract new residents.

Councillors also discussed the new minimum tax levy of $400; this means if assessment suggests a property owes less than $400 per year in taxes, the bill is boosted to $400. The CAO reasoned that municipal services cost money and all property owners should pay their share.

Coun. Ed Cole asked how many properties are affected by the minimum tax levy with White responding Alix has roughly 800 parcels and the levy will affect 54 of them; she added they are typically vacant lots.

Councillors also discussed other features of their budget, including the cost of policing, inflation, return on investments, provincial requisitions and more. It was noted Alix’ Public Works department cut their lab expenses in half by switching service providers.

Coun. Barb Gilliat stated she was impressed with the way the proposed operating budget looked. “Good job Michelle and team,” said Gilliat.

Councillors unanimously approved the 2024 operating budget. They followed this by unanimously approving all readings necessary to bring the new mill rate bylaw into effect.

Stu Salkeld
Local Journalism Initiative reporter
ECA Review

About the author

Stu Salkeld

Stu Salkeld, who has upwards of 28 years of experience in the Alberta community newspaper industry, is now covering councils and other news in the Stettler region and has experience working in the area as well.

He has joined the ECA Review as a Local Journalism Initiative Journalist.

Stu earned his two-year diploma in print journalism from SAIT in Calgary from 1993 to ’95 and was raised in Oyen, Alta., one of the communities within the ECA Review’s coverage area.