2021-2022 Operating Budget

During budget deliberations on November 30 to December 4, City Council approved the 2021 and 2022 Operating Budgets. Operating budgets fund the day-to-day costs of delivering programs and services to the community. These costs are similar to the everyday household expenses such as mortgage payments, utilities and groceries.

The approved budgets for 2021 and 2022 are:

  • 2021 Operating Budget: $379.3 million
  • 2022 Operating Budget: $384.9 million

Tax dollar breakdown

Your tax dollars are one of the revenue sources for the operating budget. Find a breakdown of your tax dollar and where the municipal portion of your tax dollars goes.

Revenue Sources

In order to fund the operating budget every year, The City relies on multiple revenue sources. Get a full breakdown of revenue sources.

What is an operating budget?

The operating budget shows the day-to-day costs of delivering programs and services for the next year. These costs are similar to your everyday household expenses such as mortgage payments, utilities or groceries.

What is an operating plan?

The proposed operating plan for 2023-2024 outlines the expected tax supported operational needs based on current services and programs and the adjustments required to comply with Council Budget Guidelines regarding property tax increases.

What are the total approved operating budgets?

During budget deliberations November 30 to December 4, 2020, City Council approved the following operating budgets:

  • 2021 Operating Budget: $379.3 million
  • 2022 Operating Budget: $384.9 million
How are the operating budgets funded?

The main revenue sources for the operating budgets are property taxes, user fees, sales of goods & services and grants. The operating budgets are split into tax supported operations and utility/self-supported operations. Tax supported operations are not self-sufficient based on the revenues they can generate and require property taxes to provide a balanced budget. Utility/self-supported operations do not require property taxes and instead generate their revenue required by increases in fees or in the case of utilities, the rates customers are charged.

Why did The City approve multi-year budgets this year?

Unlike in past years, administration put forward multi-year budgets for both operating and capital budgets. There are many benefits to doing multi-year budgets instead of annual budgets. The first is having multiple years approved at once allows for a longer term look at operations in order to find more innovative and efficient ways to provide services to citizens. It also makes the review process easier: the second year in a multi-year budget shifts to more of a review while having the opportunity to respond to external influences and adjust the already approved budget accordingly.

What direction did administration take to build the 2021-2022 operating and capital budgets?

Throughout the budget planning process, administration was able to meet the following financial parameters set by Council in June 2020:

  • 0% tax increase: property owners whose property has an average change in assessed value will not see any increase to the city portion of their tax bills in 2021 or 2022
  • 0.5% capital contribution in the 2021 and 2022 Operating Budgets
  • No more than a 0.5% increase in utility rates for 2021 and 2022
  • No increases in user fees or new fees in the 2021-2022 budgets
  • Reserves (excluding offsite and parking reserves) will be in a positive balance
  • The 2021-2022 capital budgets meet the approved Council Policy which limits debt to 75 per cent of the Provincial Debt Limit
How was administration able to meet the parameters set by Council?

Like those in the private, not-for-profit and charitable sectors, The City of Red Deer is facing unprecedented financial challenges stemming from the economic slowdown coupled with the impact of COVID-19. In order to reduce the operating budgets, administration reduced staff and restructured the organization. These changes, along with opportunities for more innovative and efficient service delivery allows The City to continue to maintain the services and programs with lower budgets for 2021 and 2022.

For the capital budget project costs and timing were adjusted to match funding sources available. Additional capital project funding for 2021 was received from both the Provincial and Federal orders of government, which helped to reduce the amount of changes required.