Abbotsford city council will be considering a property tax increase that ranges between 1.5 to 4.3 per cent during the 2012 budget process.

City staff expects to present the tax range, which is part of the 2012 financial plan on the operating and capital budget, at the council meeting on Monday.

Judy Lewis, acting general manager of finance and corporate services, said the city must find a balance between keeping tax increases to a minimum while providing an adequate level of service to residents.

It's not likely council will opt for the high end of the proposed tax hike, said Lewis.

"It's highly unlikely it will be that high (4.3 per cent), because I believe council is giving staff clear direction to keep taxes at an absolute minimum," she said.

In 2011, Abbotsford property owners had a tax increase of 4.3 per cent.

Council is taking into account the slow economy and the taxpayers' ability to pay for city services, Lewis noted.

A one per cent tax increase is equal to $1,094,000 of budget revenue.

Each one per cent tax hike for residents would result in an extra cost of five dollars per every $100,000 of a property's assessed value.

The owner of a $400,000 home would see a property tax increase of $19 from the amount paid in 2011.

That increase would not include any increases associated with water and sewer rates, or school, hospital or library taxes.

For business or commercial properties, a one per cent tax increase would translate into a $13 increase per every $100,000 of assessed value.

A business owner would face an increase of $53 dollars above what was paid in 2011 for a property valued at $400,000.

It appears the majority of residents favour cutting city services to maintain or reduce taxes, according to a 2011 citizen survey conducted by Ipsos.

Fifty per cent of respondents preferred to cut city services while 35 per cent of those asked favoured increasing taxes to enhance or maintain current services.

The top four budget priorities for residents were transportation (42 per cent), crime (29 per cent), city services (20 per cent) and parks, recreation and culture programs (15 per cent), according to the survey.

A total of $751,000 in new services has been proposed and would be included in a 4.3 per cent tax hike.

The largest increase would be an additional $414,000 to the Abbotsford Police Department for three officers and a civilian employee.

Other new services include $75,000 to maintain arena ice, $70,000 for five new firefighters, $61,000 for a new bylaw officer, and $51,000 for the 2012 Canadian Senior Curling Championship in March.

However, there is $3,079,000 in possible reductions that could bring the tax increase down to 1.5 per cent, according to the staff report.

The city could eliminate a per one cent tax levy that went to supplement the capital budget and reduce the existing capital transfer for a total reduction of $1,594,000.

Such reductions would mean significantly reduced capital reserves that - if the 2011 capital budget projects were completed - could drop to $3 million dollars.

The Abbotsford Police Department's request for an additional $414,000 in 2012 plus an additional cut of $85,000 to its existing budget would translate into a reduction of $500,000.

Other reductions would include a total of $350,000 cuts through restructuring city departments and contracting out city jobs, which could mean job losses and/or reduced hours for city employees.

Other factors that need to be considered in the budget process are whether to expand transit at a cost of $235,000 and fee for service requests from community organizations to the city that total $269,000.

The city is encouraging the public to come out and provide input around the budget process, said Lewis

Key Dates for 2012 Budget Development are:

- February 6, 2012: Council Budget Meeting, General Fund (Operating and Capital), 1:00pm-3:00pm, MCA Auditorium

- February 9, 2012: Public Information Session, General Fund (Operating and Capital), 7:00pm-9:00pm - Clearbrook Library Meeting Room

- February 13, 2012: Council Special Budget Meeting - Utilities (Operating and Capital) - 1:00pm-3:00pm - MCA Auditorium

- February 15, 2012: Public Information Session - Utilities (Operating and Capital) - 7:00pm-9:00pm, Clearbrook Library Meeting Room

- February 20, 2012: Council Budget, Consolidated (General and Utilities) - 1:00pm-3:00pm,MCA Auditorium

- February 27, 2012: Council Special Budget Meeting, Financial Plan Approval, 4:00pm- 5:00pm, City Hall Room 530

- March 5, 2012: Council Regular Meeting, 2012 Budget Bylaw Adoption, 7:00pm, MCA Auditorium

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