Kelowna residents don't have as many new neighbours to help shoulder the tax burden this year.
Taxation revenue from properties built within the last year are forecast to be just over $1 million, according to the 2013 provisional budget to be reviewed Thursday by city councillors.
That is down significantly from the $1.6 million the city collected this year from the owners of newly-developed properties. The year-over-year difference of $500,000 equates to a tax increase of about 0.5 per cent.
The estimate of tax revenue from new properties is subject to revision before final adoption of the city budget next spring. Recent practice has been for the initial projection to be on the conservative side, with additional revenue coming in to help lower the actual tax increase.
Currently, staff are recommending a municipal tax increase of 2.5 per cent, with a total taxation demand of $104 million. That means the owner of a typical single-detached Kelowna home with an assessed value of $454,000 would pay $1,686 in municipal taxes in 2013, up $42 from this year.
While council's practice has been to trim the projected tax hike through nine hours of budget deliberations, Mayor Walter Gray has said he doesn't think there's much "wriggle room" in the spending plan.
Some increased costs have already been built into the 2013 budget because of decisions taken in the past by city council. For example, the city's unionized workforce has a contract that provides for a 1.5 per cent wage increase next year, and council has a four-year plan to increase Kelowna RCMP staffing by 22 members.
The city expects to collect $357 million in total revenue next year. Direct taxation accounts for $104 million, or 29 per cent of the total, with various user fees, charges and drawdowns from financial reserves making up the next largest revenue sources.