THUNDER BAY -- City administration is proposing to offset higher property values by decreasing the municipal tax rate by 3.4 per cent.
City administration’s proposed 2013 budget includes a tax levy increase of 2.6 per cent over 2012, which would equate to $159.6 million in tax-supported revenue. But, if passed by council, the municipal tax rate could decrease to offset the impacts of the four-year reassessment process by the Municipal Property Assessment Corporation.
Carol Busch, general manager of Finance and Corporate Services for the City of Thunder Bay, said the reassessment causes property values to increase so the decrease in the tax rates would mitigate some of that impact.
“Since 2009, on average our municipal levy has been about 3.1 per cent,” she said.
“This is significantly lower at 2.6 per cent. One of the things that’s a benefit to us in 2013 is the fact that we had fairly sizable growth last year. The growth was approximately $1.2 million and it resulted in our tax rate being about .65 per cent lower than if there had not been growth.”
According to figures released by the city, of the extra $4 million raised, $900,000 is tied to the net operating budget due to higher costs for emergency services, and $3.1 million will be used for infrastructure improvements -- mainly roads.
A total gross of $15.6 million is being spent on roads and related projects with an additional $4.7 million being spent through the infrastructure renewal program.
Busch said the budget in the past usually spent in the range of $10 million on roads but over the past three years, that number has increased significantly.
In the capital budget, the city is spending at least $2 million more in roads and an additional $400,000 in storm water management.
City Manager Tim Commisso said they want to address the needs of the city and ensure they have money ready for big projects, such as the Golf Links corridor.
“It’s a challenging year to say this is how everyone is going to be impacted,” he said.
“Everyone is going to be different. What we have focused on is the increase on the tax side of the overall levy, which is the amount of taxes we collect to run the city. That’s up 2.6 per cent or $4 million. Of that $4 million, $3.1 million is going into capital spending.
“For the third year in a row, we’re increasing the amount we’re spending in roads and stormwater management. The rest about $9 million is really for covering everything else. That’s a pretty responsible number when you look at a budget and the size of the city.”
Emergency services including Superior North EMS, Thunder Bay Fire and Rescue and Thunder Bay Police Service were one of the few to list an increase from last year.
EMS is asking for an increase of 8.4 per cent from last year, followed by police with 3.4 per cent and fire at 0.9 per cent.
Commisso said he wants to look at emergency service to try to bring their increases into line.
“When you look at the budget, except for emergency services, all the other operating budgets and boards are pretty well at zero,” he said. “We’re trying to find savings to allow emergency services to carry on. That’s not unlike other municipalities but we need to come to grips with that.”
Commisso called the budget a starting point for council.
He also added that water rates are expected to go up by 7.1 per cent.
Mayor Keith Hobbs said he was pleased with the budget so far but wanted to go over it more in detail over the weekend. He called it a barebones budget.
“Every department has pretty much come in at zero-based budget except for emergency services,” he said.
“That’s a concern obviously to me but it’s a concern across the province. Budgets for fire, EMS and police have gone up to $6 billion in the province and trending upwards all the time. We got to start looking at that and looking at the core services. If we can cut those budgets I think we can make this go a long way to making this more palatable.”
Hobbs believes the major struggle for police is dealing with social issues, such as substance abuse and mental health. He said he would have preferred more money being spent on organizations like the Shelter House instead of the Thunder Bay Community Auditorium.
He added the budget also looks at helping residents who received a 30 per cent higher property value reassessment.
Westfort Coun. Joe Virdiramo called the budget reasonable but with room to look for savings.
One suggestion he had was looking at the ways the city is spending on services such as the two per cent increase in swimming lessons.
Virdiramo also expected that the reassessment will be top of mind for most residents.
“People’s assessments that went up may have their taxes go up at the same time,” he said.
“Therefore you have to adjust the mill rate to compensate for that. The water rate is going to be another issue. I think it is slated for 7.1 per cent.”
