Oak Bay residents could face an 11.4 per cent tax increase this year.
At a committee of the whole meeting on Thursday, March 13, the district’s director of financial services Rianna Lachance presented Oak Bay's draft 2025 financial plan to council and members of the public.
“Deliberations on this budget are particularly challenging,” she said. “Investing in a time of great economic uncertainty as a result of swiftly evolving trade conditions, cost pressures and likely supply disruptions are not ideal.”
The plan originally proposed a 13.3 per cent tax increase, but council voted to pare back the hike, in part by slowing the rate of increase to fire department positions. Council will debate and approve the revised increase at a future meeting.
At 6.1 per cent, or at $2.19 million, contract and agreement obligations account for the largest portion of the proposed increase.
“This includes wages and benefits, as well as inflation adjustments in existing vendor contracts,” Mayor Kevin Murdoch said in an email. “These costs reflect the need to fulfill contractual obligations and account for rising expenses tied to inflation.”
Asset management is slated for a two per cent or a $720,000 jump.
“Oak Bay Council recognized the need for substantial annual investment in asset replacement in 2018,” said Murdoch. “Since 2019, council has committed to increasing the annual budget committed to asset replacement by two to 2.5 per cent each year.”
The Oak Bay Police Department could see a 1.2 per cent, or $420,664, bump in funding, which will help offset inflationary pressures, according to the draft plan.
“The police budget is quite complicated this year. Much of the inflationary costing is coming from external agencies, such as integrated units and E-Comm,” said Murdoch. “There is also a change of structure including a new position, allowing the formation of a new platoon model. This will result in better response availability, less overtime and more opportunity for proactive policing in areas like traffic enforcement and youth programs."
Other increases include those for inflationary adjustments, active transportation and one-time costs.
“The whole region is seeing considerable tax increases this year. A large part is the lag in budgets accounting for the high inflation of the last 24 months or so – the new prices get built into the new budgets as contracts are renewed," said Murdoch.
"Many jurisdictions, including Oak Bay, are increasing protective services staffing to meet changing requirements. For Oak Bay, the primary drivers are continued investments in asset management and replacement."
