THUNDER BAY – A municipal tax levy increase of $6.6 million is the starting point for this year’s city budget despite capital spending being slashed by $13 million.
The increase of 3.61 per cent would bring the total municipal tax levy to $190.6 million. The draft budget documents were made publicly available on Tuesday, kicking off the month-long process that will finalize the city’s financial direction for the year.
After factoring in growth, the net levy increase is forecasted to be 2.9 per cent to existing taxpayers. The city has calculated 2017 growth in providing an additional tax generating power of $1.3 million.
The levy is the total amount of money required to be collected from all municipal property taxpayers and is not the rate of a property tax increase.
Even though the city proposes collecting more from its tax base, the total budget would spend less than the fiscal framework approved last year.
The nearly $400 million proposed combined rate and tax supported budget is more than $7 million less than the 2017 budget.
The most significant reduction is in the gross capital budget, which would be cut by more than 17 per cent compared to the previous year to $63.4 million. The city’s net capital budget, the total amount reduced by external funding, reserve funds and user fees, is slated to remain consistent with last year at $16.4 million.
Significant areas of capital funding proposed in the budget include $15.2 million for roads projects, $7.5 million for fleet and equipment replacement, $3 million for storm water management, $3 million for parks and $5.7 million for Waverley Resource Library renewal, which is noted as being subject to funding from senior levels of government.
The gross operating budget is forecasted to rise nearly $6 million – or 1.7 per cent – to $336 million.
The city has identified a $1.8 million reduction from funding received through the Ontario Municipal Partnership Fund and increased expenses of $1.1 million related to the Fair Workplaces, Better Jobs Act newly implemented labour reform passed by the province as major drivers.
Water and sewer rates will each increase by three per cent, bringing the proposed total sewer and water annual costs to $1,151 for the average household.
The 2017 budget passed by council included a levy increase of 3.59 per cent, or 3.13 per cent after growth.
City council will be presented with a long-term financial overview next Tuesday, followed by a public pre-budget deputation meeting on Jan. 11. Four budget review meetings are scheduled, beginning on Jan. 16.
