Calgary condo blames 12% fee hike on minimum wage, carbon tax but economist doubts claims

A property management company is blaming Alberta's increased minimum wage and the carbon tax for rising condo fees, but an economist who has studied both provincial policies says they appear to have little to do with the increase.

Calgary condo-owner John Bender saidhe was surprised to receive a letter in the mail showing his monthly fees weregoing up by 12 per cent to $487 in 2017. Usually the fees for his southwest Calgary condogo up by two or three per cent.

"It's obviously very disappointing," said Bender. "It's going to be tough for a lot ofCalgariansout there, especially the ones that are on fixed incomes."

Not directly affected by carbon tax

Bender is also concerned the increased condo fees are going to decrease the value of his home.

CBC News contacted the property management company, FirstService Residential, but they did not return thecall.

In a copy of the letter Bender posted online, the company says thecost of electricity, water, sewage, landscaping and snow clearing is rising. It also sayscondo owners needto contribute more money into a reserve fund for replacing expensiveitems like the roof or siding.

"Much of the increases above relate to an increase in minimum wage and the government implemented carbon tax levy," writes FirstService Residential in the letter, on behalf of the building's board of directors.

But University of Calgary economist Trevor Tombe said the explanation in the letter doesn't make sense.

"Many of the items listed, such as electricity or water costs, are not directly affected by Alberta's carbon tax," Tombe said.

"Though some costs will indirectly increase, the magnitudes are in the tenths of a percent, not the 12 per centincrease claimed by the condo board."

The minimum wage increase could impact the landscaping and snow clearing expenses referenced in the letter, Tombe noted, but those only make up $3,000 of $91,472 in added expenses the board cited as justification for the fee hike.

"The minimum wage increase will matter only to the extent that the condo uses minimum wage workers," he said. "It may, but they did not sufficiently detail their costs to claim the increase is due to government policy."

Condo owners vulnerable, says advocate

JuneDonaldson, an advocate for condo owners in Calgary, says condo boards and property management companies have the power to raise fees and can justify the decision however they see fit.

"Most condo owners have no idea how vulnerable they are," she said.

"It's wide open for condo boards and for condo managers to raise fees as much as they want, when they want, and how they want."

Concerned condo owners need to be directly involved in the management of their building if they want to protect their investment, she said.