BC property taxes rising as cities take on provincial duties

Cities are picking up the provincial responsibility tab and it’s costing taxpayers.

A recent BC Business Council report found property taxes have nearly doubled across the province since 2010, while local governments take on roles typically led by the provincial government.

The report describes “exceptional” municipal spending growth as a “runaway train” that makes BC cities increasingly unaffordable for residents.

For the typical British Columbia consumer, property taxes take sixth place among the top ten increasing costs since 2010, according to Statistics Canada data compiled in the report.

While property taxes go up, the BC Business Council says local governments are less efficient and taking roles outside their typical scope.

“This raises questions about whether there has been an implicit downloading of responsibilities by the province, a decision by municipal leaders to broaden their mandate, or an inefficient duplication of activities between provincial and local governments,” the report reads.

It’s a phenomenon dubbed “scope creep” in the report, but it’s not one that’s lost on local officials in Kamloops and the Okanagan.

An in-house report at Kamloops city hall tallied more than $7 million in five years of spending due to senior government “shortfalls” or service “gaps,” particularly due to homelessness and the toxic drug crisis.

In that time, Kamloops has voluntarily beefed up its own bylaw department to oversee social issues and support police, along with recognizing some bylaw officers as “peace officers” it has launched its own housing-oriented non-profit and is exploring ways to open a locally-owned medical clinic.

Meanwhile, a BC-wide report in 2014 found senior governments had steadily cut local government transfers for decades. More recently, BC cities claim a lack of provincial funding to support new housing requirements is forcing local governments to cough up more local taxpayer funds to address homelessness and a the housing shortage.

The BC Business Council found Kamloops and Kelowna have largely kept spending in line with population growth over the past decade, but all BC cities have generally seen more spending on provincial responsibilities in those years.

Across more than 150 BC cities, spending on health, social services and housing as risen by an average 132% from 2013 to 2023, according to the report.

That’s more than any other category and one that’s typically not the role of a local government.

“Perhaps municipalities have become less efficient at delivering core services because they are distracted by scope creep,” the report reads.

It concludes with several recommendations suggesting BC cities attach spending growth to population growth and “establish benchmarks” to measure whether taxpayers are getting value for their spending.

It also suggests the province re-evaluate the mandate for local governments to avoid scope creep and re-establish the Auditor General for Local Governments.