The budget is one of the most important documents that city council produces as it outlines how your tax dollars are spent to provide the programs and services the community desires. Each time your garbage is collected, you turn on the water, have your road plowed, or use a city park, your tax dollars are at work.
As the budget is prepared, debated and finalized, it’s critical that you have the opportunity to weigh in and let your voice be heard. Working through the challenges of the pandemic, we asked what you would like to see in the budget, and what programs and services are the most important to you.
Through a survey and virtual town hall meeting last June, you shared input and comments on the 2022 City Budget. A 2022 Pre-Budget Engagement Summary Report was received by city council on Oct. 25, which captured all input shared by the public.
This allowed city council to consider all citizen feedback prior to reviewing the proposed 2022 budget prepared by administration. When the proposed budget is released in early January, there will be further opportunities for you to provide input, including deputations to city council.
There are many difficult choices facing our community in each budget. This year’s budget includes a request from the Police Services Board for a new police station estimated at $60 million, costs to move forward with a new digital strategy, an increase in our capital program to chip away at our growing infrastructure deficit as well as pressures due to continued stagnant growth in assessment. We also face many challenges and unknowns as we continue to recover from the impacts of the COVID-19 pandemic.
City council provides a budget direction to Administration annually. For 2022, council directed administration to target a municipal tax levy increase of no more than 2.25 per cent, a half percent lower than the recommended increase of 2.75 per cent, recommended by Administration.
There are three main components to the annual budget and a host of terms that you may hear in budget deliberations or in articles published by the media. Clarifying these components and terms will assist in understanding the process better.
First there is the tax supported operating budget, or the plan for the day-to-day operations, including employee salaries, materials and supplies, contractual services and financing of capital projects. It’s largely funded by property tax dollars and user fees, which include charges for recreation programs, transit, infractions, permits and licensing.
The second component is the tax supported capital budget. This is the long-term plan for the construction or purchase and financing of the city’s capital assets. Examples include infrastructure, land, buildings, machinery and equipment. Forms of funding include grants, gas tax, reserves, debt and contributions from the operating budget.
And thirdly, there is the rate supported operating and capital budget. This is the annual plan for the day-to-day operations of the city’s services and financing of capital projects supported from water, wastewater and storm-water user rates. Forms of funding include grants, debt, reserves and contributions from the operating budget.
You may also hear about gross vs. net. The gross budget is the total cost to deliver City programs and services. These include everything from snow plowing to long-term care to the office supplies the City uses every day.
The net budget is the cost to the municipal rate payer to deliver city programs and services since it is adjusted downward from the gross budget to reflect the revenues and subsidies that the city is projected to receive. This is the portion of the budget that is paid for through your property taxes.
The annual infrastructure deficit is the gap between capital funding required to maintain the assets in accordance with asset management plans and the current capital budget. Currently, this annual deficit is estimated to be on the order of $30 million and council is working hard to increase capital spending to properly maintain our assets in order to lower overall costs.
The tax levy increase before growth is the actual increase in the levy from the prior year, typically stated as a percentage. The tax levy increase after growth is the amount of that tax levy increase less any assessment growth that is projected in the budget year.
Overall, the city's mission is to provide programs and services that reflects public demand while ensuring that all provincial legislative requirements are being met.
There are still many opportunities to get involved and share your views. The Public Pre-Budget Deputation meeting takes place on Jan. 13 at 6:30 p.m., and the Public Post-Budget Deputation meeting takes place Feb. 3.
The proposed operating and capital budgets will be available Jan. 4, 2022 on the City website, and in hard-copy at the Waverly and Brodie Public Library. Other key dates in 2022 include:
- · Jan. 5 to Feb. 3 - online survey will be available
- · Jan. 13 - 2022 public pre-budget deputations
- · Jan. 18, 20, 26 and Feb. 1 - Council budget review
- · Feb. 3 - 2022 public post-budget deputations
- · Feb. 7 - 2022 budget to be approved
For more detailed information, visit: www.thunderbay.ca/budget
I encourage you to reach out to city councillors by phone or email if you have any further input on key issues, city service levels and taxation. Your input is very much appreciated and helpful.
Mark Bentz is currently serving his fourth term on city council and is the chair of administrative services which includes the city’s annual budget.
