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COVID has cost Innisfail nearly $300,000 in revenue

Possible significant tax hike for 2021
WEB Town of Innisfail
The Town of Innisfail has lost close to $300,000 in revenues from the COVID-19 pandemic. Town officials will soon begin budget deliberations for 2021. They could be looking at a significant tax hike for residents next year to help make up for the revenue loss. File photo/MVP Staff

INNISFAIL – The municipality has lost close to $300,000 in revenues since the start of the COVID-19 pandemic, a loss that could force the town to bring in tax hikes in the 2021 budget.

“It is absolutely a possibility,” said Heather Whymark, the town’s director of corporate services. “It is not outside of my parameters at this point in time of thought. We still have another full year of COVID to recover from.

“I am not panicking yet but the next budget is going to look very, very different from any one I have brought before that for sure.”

Mayor Jim Romane weighed in to say that it’s too early to predict whether council will choose to increase taxes on homeowners, many of them still reeling from the pandemic.

 “I think it’s premature to make any decision in that regard right now. We have to wait and see,” said Romane, adding the current revenue loss figures are from the second quarter report for the end of June.

“It’s certainly going to be interesting to hear the end of the third quarter and where we stand, and if there are any surpluses from other projects.”

Whymark said last week following town council’s regular meeting on July 27 the COVID-19 pandemic has cost the town $286,976 in non-collectable revenues as of June 30. This includes $121,000 in property tax penalties, which were extended to Dec. 31.

There was also a $45,000 revenue loss in utility penalties.

“The public needs to understand that council did not charge penalties, which was in their favour but it is a loss to the town,” said Whymark.

She also said another revenue loss was due to facility closures during the pandemic. Whymark said there was a loss of $80,000 in aquatic centre revenues, and another $40,000 loss with the Arena.

 “This is what I expected, nothing unforeseen,” said Whymark. “Our initial costs are only $15,000 for stuff we had to go outside of COVID, like the masks and the sanitary solution. That cost was over and above our normal budget.”

With the town now seeing at least $286,976 in lost revenues, Whymark is not saying at this time what needs to happen for the town to make up these losses.

However, if the town chose to make up the loss in its 2021 budget it could bring in a tax increase of up to four per cent. A one per cent increase would bring in about $77,000.

Budget deliberations for 2021 begin at the end of September or the beginning of October.

“Right now I am not saying what needs to happen,” she said, adding the aquatic centre is open and there is a hope the town will recoup some of the loss. “We will get more revenue. We don’t know what is happening with the arena. We are just going through that assessment now for it to open.”

At this point of the fiscal year she said the town usually has a large surplus but she believes it won’t be as large coming into the end of the year.

“I am not allocating anything at this point in time,” said Whymark. “That will be looked at for reserves to balance the budget or however they (council) want to do that.”

She said there is still hope that the province might compensate the town for COVID related expenses.

“We are monitoring and watching to see if there is anything out there coming in our direction for that,” said Whymark. “We do track it and keep it separate so we have the numbers ready to put on the table if they should say, ‘how much did you spend on COVID?’, and we could get some of that reimbursed back.”

Whymark said she has not yet made a direct call to anyone in the provincial government about COVID expense reimbursement but the town has filed queries and information about shovel-ready projects, which the province had asked for as officials made it known money was available.

 “We did send that out to them but nothing to do with COVID,” she said.