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Report Examines How Municipalities Can Cut Costs, Property Taxes

  • Canadian Taxpayers Federation and report cautions that municipal governments could stall recovery efforts if property taxes aren’t curtailed

The Canadian Taxpayers Federation (CTF) and public policy think tank released a new report today that examines 10 ways municipal governments could reduce expenditures and property taxes. The groups caution that if municipal governments don’t reduce property taxes, they could obstruct Canada’s economic recovery.

“If a business or household is struggling right now, a property tax increase, even a freeze, could really hurt their ability to stay afloat,” said President Colin Craig. “Just as households and businesses have tightened their belts, there’s room for municipalities to do the same. If they curtail their expenses then they can help save some jobs by reducing the property tax burden on struggling businesses.”

The ten cost-cutting options highlighted by the report include:

  1. Lead by example: Politicians and executive staff could lead by example by taking pay reductions and curbing discretionary spending.
  2. Salary reductions: Reduce compensation for city employees to reflect what has happened to incomes outside of government.
  3. Pension reform: Reform municipal pensions and benefits so they are more in-line with the private sector.
  4. Eliminate business subsidies: Politicians can best help the economy by letting families and businesses keep more of their own money, rather than having bureaucrats pick winners and losers.
  5. Prioritize spending: Focus on priorities such as policing and road repair, not discretionary areas such as new public art, professional sports facilities, etc.
  6. Utilize managed competition: Tender more city services, but support city employees with developing their own bids.
  7. Sell surplus land/assets: Review city land and assets to determine opportunities to dispose of unneeded inventory.
  8. Gainsharing: Create an employee rewards system to incentivize staff to come forward with ideas to reduce costs.
  9. Utilize new technology: Explore opportunities to use new technology to reduce costs.
  10. Share ideas: Spend more time speaking with other municipal governments about innovative ways to reduce costs instead of gathering to devise strategies to raise taxes.

“Politicians may try to claim that the cupboards are bare, but this report shows there’s still fat for many councillors and mayors to cut,” said Franco Terrazzano, the CTF’s Alberta Director. “It’s time for local politicians to roll up their sleeves and get to work cutting the fat and reducing taxes.”

To view the report – click here

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