VANCOUVER - The City of Vancouver says the COVID-19 pandemic has had a “significant impact” on its finances, including a projected $85-million drop in revenue and $13 million in additional costs.

But because of the financial challenges the pandemic has posed for residents and businesses, a statement says council has directed staff to prepare the budget with property tax increases of no more than five per cent.

The city says the increase would help cover the cost of normal programs and initiatives that have also faced additional operating costs.

The draft operating budget for 2021 is $1.6 billion, $17 million less than the original planned budget.

The city warns that as the budget is less than previous years, some planned initiatives will need to be deferred.

The budget is scheduled to be presented to city council on Dec. 1.