80% of the Town's tax revenue comes from the commercial sector, with hotels paying taxes based on the 3-year average of their revenues. Covid has greatly impacted both hotel occupancy and rates. This means that in 2022 and 2023 the taxes generated from the hotel sector will be relatively low, reducing the tax revenue that the Town relies on.
Concurrently, the business to residential tax split is mandated by the Alberta Government to evolve from the Town’s current tax rate split of 6.23 : 1 to 5 : 1. The Town plans to adjust this split over several years, however, the impact will be felt on individual homeowners.
The combination of these two situations will put a significant stress on our tax revenue and on how it is funded between homeowners and businesses.
I don’t have specific answers on how to deal with this challenge, however, I am aware of it and respect that we need to proceed with caution and awareness when reviewing operational and capital budgets in the near future.