Today, Administration released the draft 2025 Tax Supported Operating and Capital Budgets. Red Deerians are invited to review the budget documents on in advance of the budget debate November 18-22.
Administration is putting forward a proposed 2025 Capital Budget plan totaling $93,384,000 and is recommending approval in principle of the 10 Year Capital program. A full list of projects included in the capital budget can be found in Section 4 of the budget.
The proposed 2025 Operating Tax Supported budget is $512,371,612, and to balance this budget just over $18 million in changes is required.
“As we’ve been signaling throughout the year, our city is facing significant financial pressures as we approach this budget,” said Mike Olesen, Growth and Finance General Manager. “Simply put, our current path remains unsustainable and it’s critical that we change our course to ensure our long-term financial health. The budget we are presenting is reflective of this urgency and considers the options available to Council to balance the budget.”
Changes needed to balance the budget can be achieved through leveraging any of the options within Council’s control. After thorough review and analysis through this budget process, Administration is recommending the following directions be considered by Council in setting our future direction:
- Generate gross tax revenue increase of $18 million: A projected $18 million boost in tax revenue will help address past financial challenges and support a more forward-focused approach. This represents an 11.25 per cent tax increase.
- Prioritize Our Services: By approving proposed service level adjustments, The City could reduce expenses by approximately $3.4 million, focusing resources on core municipal functions that matter most to Red Deerians.
- Organizational Efficiency: Administration will continue efforts to assess and optimize resource efficiency, laying the groundwork for long-term cost management.
- Achieve a Positive Variance in 2025: The City aims for a positive budget variance by year-end 2025, which will contribute to building reserves through one-time savings.
- Focus Advocacy on Future Funding: Red Deer will emphasize advocacy efforts at the provincial and federal levels to enhance support for municipal infrastructure and growth, ensuring future sustainability.
“We have fallen behind. This is due to years of low tax rates that have not kept up with the increase to our expenses, compounded by reductions in revenues and grants. Increasing our tax rates, would still have Red Deer competitive with lower tax rates than the peer cities, Calgary, Edmonton, Lethbridge and Grande Prairie,” said City Manager Tara Lodewyk. "We are at a pivotal point where we can close the gap that has been created or continue to fall further behind. We are repeating history. Our history has shown that when we hold tax rates low by using reserves, we end up facing larger increases in the following years and taking reserves to critical levels. Administration is proposing reducing expenses by $3.4M in 2025 and is committed to continuing to find ways to save dollars to help close the gap and to create a path toward sustainable finances for Red Deer.”
Community engagement played an important role in this year’s budget, with two targeted engagement periods in Spring and Fall 2024. Council will consider this feedback as they debate the budget. A summary of the feedback we received is available in the What we Heard report.
Council will deliberate the amended budget November 18-22, 2024. Citizens can watch the livestream at meeting.reddeer.ca.
To learn more, visit reddeer.ca/Budget2025.