Tax break for homeowners to trigger $9M cut in spending

City council's decision to keep this years tax increase to a minimum will mean a $9-million reduction in municipal spending.

Councillors gave tentative approval on Monday to a 2.3 per cent property tax increase, opting against a higher rate that would have off-set a reduction in provincial education taxes.

Factoring in a one-time rebate applied to tax bills last November, the average homeowner will pay $40 less tax this year than last.

• Average Calgary homeowner to save $40 on property taxes this year

Council approved a small across-the-board cut for every department, except for the Calgary Police Service, in this years budget.

Calgary Transit was set to expand service by 55,000 hours. That will be scaled back by 12,000 hours affecting service frequencies in Royal Oak and Tuscany, said director Doug Morgan.Ten transit job vacancies also wont be filled.

And because of the cuts, the annual spring street cleaning will take 16 weeks to complete instead of eight.

Mayor Naheed Nenshi, who wanted council to absorb the full tax room vacated by the province, says the city needed the money.

What it shows though is that as we've been pushing and pushing for efficiency, we're starting to get to the point where we're actually hitting the bone. We're getting through the fat and hitting the bone. You can't shrink to grow forever, he said.

A final vote on the property tax hike will take place in a couple of weeks.