Burnaby landlord questions city budget, tax increases

Burnaby Mayor Derek Corrigan -
Burnaby Mayor Derek Corrigan
— image credit:

Burnaby landlord Gabriele Cocco couldn't believe the numbers.

Upset at his increasing property assessments, he started looking at his taxes and making inquiries at Burnaby city hall, including a Freedom of Information request.

The figures he got back in response were, he said, "a little bit astonishing, quite honestly."

According to the information sent to him by the city finance department, the population of Burnaby increased 15.8 per cent between 2000 and 2009.

During that period the number of city employees grew by 17.8 per cent. But the overall city budget grew from $208.5 million in 2000 to $327.3 million in 2009, an increase of almost 57 per cent.

The city portion of residential property taxes went up 56.3 per cent.

But for Cocco, who owns several light industrial and commercial properties, he was most aghast at the 191.6 per cent jump during that period in property taxes the city received from owners of light industrial properties and the 57.3 per cent jump in the taxes received in the business, or commercial, category. The city saw an almost 30 per cent increase in taxes paid by owners of major industrial properties.

"It's obscene," said Cocco. "I couldn't believe the discrepancy between the consumer price index and the increase in property taxes. There's no correlation."

On one of his light industrial properties, at Waltham Avenue and Kingsway, the total taxes went up almost 52 per cent between 2004 and 2011, he said. However, the portion that goes to city hall saw less of an increase, at 27 per cent.

The budget increases "don't relate to the private sector increases," he said. "You couldn't afford to stay in business with these kinds of [cost] increases."

In the end, Cocco stressed, it's not the landlords who suffer, but the tenants to whom the tax increases get passed. He's lost at least one tenant who simply found the increases too onerous.

"I'm a frugal guy," he said. "I don't believe just because we're in our heyday here and there's a lot of building and a lot of money coming into the city that you should just go out and spend it."

For his part, Cocco admits he's raising his concerns now in hopes it will give voters something to think about as they head to the polls on Saturday. He believes it's important to at least elect some people that could serve as opposition to the dominant Burnaby Citizens' Association, which currently has a monopoly on council.

Burnaby Mayor Derek Corrigan responded that there were many things that happened between 2000 and 2009 that has resulted in increased operating costs at city hall, including growth in population and in the business and industrial sectors.

The large increases in property taxes collected include not only inflationary jumps but also more money from a growing tax base, resulting from new housing, commercial and industrial developments.

"So our tax base keeps growing ... the actual services and the amount of revenue, will keep increasing but it won't necessarily mean that your average citizen is paying more on their taxes than the normal rates that they expect" of two to 3.5 per cent per year, Corrigan said.

As for the increase in costs, much of it is due to wage increases and the provision of more services, he said.

The wages paid to the city's RCMP officers make up much of the almost 55 per cent increase in the city manager's department budget, which includes fire, police and library services.

RCMP officer wages added continuing costs to the operating budget in 2002 ($750,000 per year), 2004 ($600,000 annually), 2005 (24 new officers at a cost of $2.5 million a year), 2006 ($1.5 million), 2007 ($1.2 million) and 2008 ($245,000 for three additional officers plus $850,000 in wage increases). In 2009, the wage increase totalled $2.8 million, plus the RCMP received new mobile workstations at a cost of $450,000 and four new RCMP clerks ($350,000).

Policing was a big issue in previous elections, said Corrigan. "And we were asked to meet the community desire for more policing. As a result, we have been paying significant tax dollars to enhance our police force over those years."

Corrigan noted that for several years before this period, RCMP wages were frozen which resulted in the large catch-up increases since then. In addition, RCMP are paid the average for the top three police forces in Canada.

"The problem is we don't have any choice," he said. The RCMP contracts are negotiated by senior governments.

Other ongoing cost increases have resulted from four new community police offices opening in 2000 ($750,000), the opening of McGill library branch ($2 million), a new city computer system ($3.7 million), improvements at Riverway Golf Course ($630,000), and the opening of the Tommy Douglas library branch ($1.6 million).

New facilities generally attract more users which creates a need for more staff and expanded opening hours, he said, noting that the Tommy Douglas library saw a 30 per cent jump in users, compared to the old Kingsway branch it replaced, as soon as it opened.

He said it's expected that the new Edmonds community centre currently under construction, will cost the city $1 million a year in additional staffing, even after revenues are factored in.

There were 10 firefighters added for Fire Hall No. 7 in 2007 ($850,000) and another 10 firefighters and a fire captain added in 2008 ($1 million).

The increase in the city finance department's budget, which grew by 102.5 per cent from $12 million in 2000 to $24.4 million in 2009, is largely to do with computerization of the city's operations over that 10-year period, Corrigan said.

The wage hikes of other city workers has also added to the costs, he said, noting CUPE had a four per cent increase in its contract negotiated a few years ago, which is higher than the current rate of inflation. Until contracts come up for renegotiation, the city isn't able to bring wage hikes in line with inflation.

The 59 per cent increase in the engineering department is largely in the utilities area (almost 97 per cent on its own) which is recouped from taxpayers, said Coun. Dan Johnston, chair of the city's finance committee.

Those hikes included $7.6 million for watermain replacement, $10.5 million for the cost of water from the regional district, $8.7 million to separate combined sewers (to prevent sewage from accidentally entering local waterways during heavy rainfalls), $2.1 million in the cost of regional sewage services, $2.4 million for yard waste collection, $230,000 in Metro Vancouver garbage fees, $1.4 million for roadwork and $2.62 million for road maintenance downloaded by the province, much of which is recouped from TransLink.

Contracted salary increases accounted for $4 million of the cost increases in the department over the 10-year period.

Johnston stressed that people need to look at both revenues and expenses to get the real picture of the city's finances.

"I think that you don't get to be the best run city in Canada in 2009 without having committed to do a lot of things that make for a well-run city," said Corrigan, referring to the Maclean's magazine survey,

"You don't get to where we are without spending some money and certainly that's been true over the last years. We think that this money's been a great investment and so far I think it's proven that's true."

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