The 2025 budget deliberations kicked off today with debate and approval of the 2025 capital budget, with two amendments.
Administration proposed an overall capital budget for 2025 of $93,384,000, including approximately $34 million for the fleet program. During the debate, Council passed a resolution related to Fleet Growth and Enhanced Replacements that reduced the total capital budget by $4,445,000 bringing the final 2025 capital budget to $88,939,000.
Additionally, Council approved the following two amendments related to the budget process:
Council directs administration to bring back a report by the end of Q2 of 2025, that breaks down capital project commitments made prior to 2025.
- Council directs Administration to bring forward an updated Council Capital Budget Policy by Q2 2025 to guide the preparation of the Capital Budget for the 2026 Budget. This updated policy will include
- the treatment, presentation, and approvals required for capital items carried forward from previous fiscal years; and
- a process to review capital projects at regular intervals with respect to cost versus budget, timeliness of projects.
Council also gave approval in principle to the 10-year capital plan, which proposes annual spending of approximately $148 million.
"Approving this capital budget was a careful decision in a challenging year,” said Mayor Ken Johnston. We’re facing a difficult budget, and we’ve had to make hard choices to ensure we’re focusing on what matters most – our core infrastructure. This budget reflects a balanced approach, prioritizing critical maintenance and upgrades to roads, bridges, and facilities that support the day-to-day lives of Red Deerians. We’re committed to meeting our community's needs responsibly, even in a difficult fiscal environment, to keep our foundation strong for the future."
The City’s capital budget is funded through various sources, including the Capital Projects Reserve, along with on-going and one-time federal and provincial grants and funding programs. In recent years, these funding sources have continued to decline, essentially meaning our ongoing capital needs are outpacing our external available funding. An additional factor in our capital program is available debt. Currently we are servicing $290 million in debt; the approved 2025 capital plan will add approximately $105 million in debt. This is within Council’s self-imposed borrowing limit; however, our remaining available debt limit will be approximately $30 million, unless further contributions are made to the Capital Projects Reserve.
“Our Capital Projects Reserve is under significant pressure,” said Mike Olesen, General Manager of Growth and Finance. “An important part of our discissions this week as we look at the operating budget will be how to rebuild the health of the Capital Projects Reserve and potentially reduce the impact of debt servicing.”
Budget deliberations resume November 19 at 10 am. Citizens can tune in at https://meeting.reddeer.ca/onbaseagendaonline/
To learn more, visit reddeer.ca/Budget2025.