City of Calgary posts increased budget surplus of $276M for 2024

Despite facing unexpected financial challenges last year — including the catastrophic Bearspaw South feeder main break — the City of Calgary posted a budget surplus of $276 million in 2024.

That's $40 million higher than the 2023 budget surplus, which rang in at $236 million.

The good news comes from a corporate annual financial report presented to city council's audit committee on Thursday.

The report attributes the surplus primarily to "higher franchise fee revenue due to higher energy prices, increased investment income and expenditure savings across several tax-supported services."

City administration has recommended putting the operating surplus into its rainy day fund, the fiscal stability reserve.

The city received approximately $182 million in local access fees last year, down from more than $308 million in 2023.

It's projecting a further decrease in revenue from that fee this year, after it changed how it's calculated in response to concerns around affordability and rising utility costs.

The local access fee, sometimes called a franchise fee, works in lieu of a property tax to run power equipment through the city.

Instead of being tied to the province's regulated rate option — now called the "rate of last resort" — it moved to a consumption-based model this year, charging customers based on how much power they use.

After years of significant windfalls, Coun. Andre Chabot said 2024 is likely the last year the city will see a large profit from that fee.

During the meeting, Chabot said they'll have to look at how to make up for that loss of revenue, as some of the extra cash goes to the city's reserve for future capital.

"We've changed our formula, and it's going to change again when we get an agreement on how we actually structure that," said Chabot.

"We may have to look at the reserve for future capital as well and what could contribute to that on a go-forward basis because there's going to be an increasing need to supplement that."

Though Calgarians are facing an increase in property taxes despite a growing surplus, Coun. Evan Spencer — who chairs the audit committee — said he doesn't believe Calgary is overtaxing its residents.