Property owners in Whitehorse can expect to see a four per cent hike in their property taxes this year, along with a 7.33 per cent increase on their water and sewer bills.

And that's not sitting well with one city councillor.

Coun. Doug Graham was the lone council member to vote against first reading of the city's operating budget Monday night, taking issue with the tax hike and with calling the document "balanced.”

In unveiling its approximately $63.4-million 2011 operating budget Monday, city officials proposed the hike that would see the average residential home owner go from paying $2,009 last year in city taxes to $2,101 this year.

The same home owner would go from paying $61.87 each month for water and sewer services to $65.58 per month.

Garbage and compost collection rates would remain the same, at $7.09 every month.

Officials continually speak of making Whitehorse a sustainable city, Graham pointed out to reporters following last night's meeting.

"That's totally not sustainable,” he said of the tax hike and expected continued four per cent increases each year into 2013 under the provisional budgets for coming years, also tabled last night.

Graham argued that significant tax hikes have been part of the city's budget for a number of years already.

City documents show the average residential property owner paying $1,634 in taxes in 2007, when bills jumped by five per cent.

That rose to $1,778 in 2008, with a 7.5 per cent increase.

By 2009, the average Whitehorse home owner paid $1,875 thanks to the first hike of four per cent.

If taxes climb by any more than two per cent, it's too much, Graham argued of the 2011 budget. He suggested that cuts to some of the proposed services could have been made.

As an example, he cited the two new front desk positions at the Canada Games Centre the city plans to fill this year.

Until the city recovers half of the costs to operate the facility, the city shouldn't be hiring more staff to operate it, he said.

With the Games Centre, Mount McIntyre Recreation Centre and Takhini Arena all sharing city staff and resources, the city has allocated $6.1 million to spend on the parks facilities, which collectively take in revenue of $2.5 million, Valerie Anderson, the city's manager of financial services, said this morning.

The two new Games Centre hirings are among a number of new positions the city plans to fund in the coming year along.

There will also be two new fire dispatch positions (alleviating the need for firefighters to serve on dispatch), a new firefighter, a position in building maintenance, an engineering projects manager (to be funded from the city's land bank reserve and the Yukon government), a planner and a compost technician (whose position will be funded through the sale of city compost).

The budget also factored in anticipated changes coming from renegotiated contracts with the city's three unions.

Anticipated changes to the transit system will also expand work hours for bus drivers.

Parking meter attendants and the animal pound attendant will also see more work hours in response to what deputy mayor Dave Austin described in his budget speech as "citizen requests for a greater bylaw presence in the community.”

(Mayor Bev Buckway was the only council member not to vote on first reading of the budget. Also a board member of the Federation of Canadian Municipalities (FCM), she is attending FCM meetings in Halifax. She did not opt to phone in to last night's council meeting.)

While the city will be hiring for a number of positions, Austin said, it took some serious discussion and decisions to come up with a budget that was able to largely absorb many cost of living increases everyone in Whitehorse has seen over the past year, such as fuel, electricity and building materials. Most local gasoline prices rose from 1.19 per litre to $1.25 per litre last week.

"As a result, we will be limiting this year's tax increase to four per cent as originally forecast in 2010,” Austin said during his 22-minute, seven-page address.

"That's an average increase of $92 a year, or $1.70 a week, and brings the average residential tax bill to $2,101.

"The vast majority of the funds from this increase will go towards funding important services such as the city's public transit system and fire protection.”

Along with the tax boosts Whitehorse residents have seen each year, water and sewer bills have also risen with time.

There were three per cent hikes in 2007 and 2008, followed by a whopping 12.5 per cent increase in 2009 before the 7.23 per cent increase the following year brought monthly water and sewer costs up to $61.87 each month for property owners throughout the city.

The exception is those in country residential areas, which are served by wells or water trucks.

Austin made little reference to the water and sewer increases in his speech, except to say: "To ensure many of our user-pay services remain viable in our growing city, there will be some modest fee increases this year.

"These programs and services are either partially subsidized, such as parks programs, to ensure affordability or full self-funding, such as water and sewer and garbage services to ensure that taxpayers who don't receive these services don't pay for them.”

During an earlier media briefing, Rob Fendrick, the city's director of administrative services, explained the increase to water and sewer rates comes from the city's decision to move the funding for the seniors' utility grant from general revenue to the water and sewer fund.

Other fee hikes would see parks and recreations fees rise their annual standard of 1.5 per cent, with the exception of day camp fees jumping by 20 per cent to better reflect the costs.

If the budget is approved as is, parkade fees would jump by 7.3 per cent. As well, a new traffic control fee of $25 would be put in place where the city's bylaw department is asked to assist in events.

While Austin spent much of his speech outlining where the city will spend its money through the year, Graham took issue with the budget being referred to as balanced. He pointed to $1.1 million that will come out of city reserves.

Graham argued the move means if anything major happens in the coming year, there may not be the money available to cover any needed costs.

Had the budget not been referred to as "balanced”, Graham said he may have voted with his fellow councillors in bringing the budget forward for a public input session and second reading.

Typically, council votes in favour of first reading on most bylaws to get them to the public input portion and second reading where there is more discussion.

Coupled with its $21-million capital budget, the city is expecting to spend a total of $84.4 million in the coming year.

After a public input session and report to council on that, it's expected second and third readings of the operating budget and accompanying tax levy and fees and charges bylaws will come forward on March 28.

While Coun. Ranj Pillai voted in favour of first reading, he told the Star at noon today his vote was simply to get the budget into the public input phase, and not in support of the spending plan itself.

Like Graham, Pillai takes issue with the four per cent tax hike.

After years of increases, they add up to a lot for home owners on a fixed income, he said, also stating it seems the city is moving toward a structural deficit, given the tax hikes.

"We need to look at some of our own-source revenue,” he said.

Pallai would be fine with a tax hike this year that reflects changes in the consumer price index and, for this year, the changes to the transit system. That would bring a tax increase of about three per cent, he said.

As it stands, Pillai said, he will likely vote against the budget at future readings.