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City of Lacombe revises Council Remuneration Policy

Council directed Administration to increase the salary and benefits to maintain equivalent net pay

At their regular meeting Monday, Council approved the Council Remuneration Policy as presented, then directed Administration to increase the salary and benefits to maintain equivalent net pay.

“While I think that it is appropriate that the elected official take-home salary stays at the level it was at the time of election, it is unfortunate that the federal tax changes will negatively impact our citizens,” said Mayor Grant Creasey.

The 2017 Federal Budget announcement on March 22, 2017, indicated an intention to amend the federal Income Tax Act, which would require the remuneration for certain elected office holders across Canada to be fully taxable (in Alberta, this includes MLA’s, school trustees, municipal mayors and councillors).

Under the current Income Tax Act, one third of the monthly remuneration is considered a “municipal officers general expense allowance” and is deemed non-taxable. With the changed Income Tax Act, the entire monthly remuneration will be fully taxable and subject to employment insurance and Canada pension deductions.

This change requires a reconsideration of the City’s existing Council Remuneration Policy. After discussion and consideration, the Council Remuneration Committee recommended an increase Council wages in 2019 to ensure the net pay remains consistent with 2018 levels of compensation.

The salaries per elected official position were adjusted to the fully taxable equivalent, with the intent to have individual net pay remain whole. The increase results in no net benefit to the Mayor or Councillors.

-Submitted by the City of Lacombe

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