Metro Vancouver will pare budget to cap tax hit at 2.5 per cent
Metro Vancouver has scrapped plans to raise regional taxes and fees by 12 per cent next year and set a new target that limits the increase for each household to no more than 2.5 per cent in 2013.
The average home will pay $524 to Metro this year, up from $513 in 2011, with most of the money going to fund drinking water, sewage treatment and waste handling.
That had been projected to rise to $587 in 2013, but the lower revised target would have the typical home pay $537, or $13 more next year.
Metro board chair Greg Moore said regional district administrators revised the targets on their own – without a board directive – and said the move was not related to the recent public outcry over the efficiency of TransLink.
"They've heard loud and clear last year and this year that we need to work as hard as we can to keep whatever increases to a minimum," said Moore, mayor of Port Coquitlam.
He said the pressure from voters to "do more with less" had already come through clearly in the lead-up to last November's municipal elections.
Metro administrators have not yet spelled out where they intend to find the required savings, but that's expected to come before the regional board approves the 2013 budget next October.
The regional district finished 2011 with a $47 million surplus on its $608 million operating budget and $304 million capital budget.
The surplus, mainly due to deferred projects and lower debt costs, will be used to reduce the debt and therefore future interest costs on major capital projects.
More than half of the increased hit to homes over the past year is attributed to rising water capital costs.
Metro spent more than $800 million in the past several years to filter water from its North Shore reservoirs and an array of other costly projects are either underway or on the horizon, including $250 million to build a new earthquake-proof water main under the Fraser River to help supply Surrey and $110 million to add ultraviolet disinfection at the Coquitlam reservoir.
Moore said cities can cut their water costs to Metro by promoting conservation, because of the user-pay system.
"If you do a good campaign to reduce the per capita water consumption in your municipality, you're going to pay less than your neighbours," he said.
But Burnaby Mayor Derek Corrigan said a city that out-conserves its neighbours isn't actually saving Metro money but merely shifting costs onto other cities.
The region as a whole still pays the same fixed costs of infrastructure and staff for the water system, he said, so if all cities reduced water use equally, none would save money – they'd all pay more as the costs of the system climb.
"By installing methods to conserve you can beat out your partner," Corrigan said. "I don't know in the long run if that is the spirit of cooperation we want to achieve."
He said residents see water as a free resource and don't realize the large expense of treating and distributing it.
The region runs 21 reservoirs, five sewage treatment plants, 50 pump stations and 1,100 kilometres of sewer and water mains.