Farmers in Rhineland Municipality should brace themselves for another steep hike in municipal property taxes this year.

Rhineland council has given first reading to a $6.9 million operating budget for 2018, which reflects an increase in spending of about $524,000 over last year.

The budget includes an average 16 percent municipal tax increase on farm property which, according to municipal officials, is due mainly to a significant rise in the assessed value of farmland in the area.

"Farmland rose 29.1 percent, so there is a huge spike in farmland assessment and that determines where we collect our money. Again this year we'll be collecting more tax from the farm piece of our assessment," said Reeve Don Wiebe.

The various kinds of properties in the municipality are assessed at different rates. For instance, farmland is taxed at a rate of 26 percent of assessed value while businesses are taxed at a rate of 65 percent and residences at 45 percent.

"So, when it comes to municipal taxes, the impact ranges from 36 cents an acre to $2.00 an acre, which means the 29.1 per cent increase in assessment is not consistent across the municipality. Some of the heavier land is selling for more money which is reflected in this reassessment," said Wiebe. "Overall, however, we feel the impact will be closer to an increase of a 1.50 an acre for municipal tax."

Meanwhile, municipal taxes will drop by about 7.7 percent for the average rural home and rural businesses will see municipal taxes drop by 6 percent on average.

This year's tax levy will generate an extra $246,000 for Rhineland, the majority of which will be used for several initiatives including economic development, increasing the municipality's reserve funds and in funding Rhineland's new asset management plan.

Other budgeted expenses for the year include $115,000 for Rhineland's Priority Roads program, $50,000 for hydrology studies and about $12,000 has been earmarked for civic elections scheduled in October.