Kincardine council

To Comment on this article Click Here

A drop in the education levy is a good thing for the rest of Ontario but for Kincardine, it means an extra three-per-cent hike in taxes.

That's the word from treasurer Brenda French who told Kincardine council last night (April 7) that taxpayers now face a 10.62-per-cent increase instead of 7.15 per cent.

This is a direct result of the reduction in the education tax rate, said French. Given that Kincardine retains, and records as revenue, the education portion of the Bruce site taxation, the revenue loss is about $196,000.

"In most municipalities there is no impact on the local levy (from the change in the education tax rate) because this money is simply collected on behalf of the province and flowed through to them," said French. "However, in Kincardine, the education portion of the Bruce site is retained by the municipality as if this assessment were payment in lieu. While a drop was anticipated and incorporated into the budget, the rate has fallen further than expected, resulting in the current shortfall."

She said that since, provincially, other assessments will rise again in 2011 and 2012, while this assessment will remain relatively the same, this revenue loss will continue and will increase in the years to come.

French recommended that council raise the tax rate equal to the funding lost, so the municipality is not facing an even greater loss next year. She said dipping further into reserves would mean a total of $1 million out of reserves this year.

"So, everybody's taxes go up except Ontario Hydro," said councillor Guy Anderson. "Why isn't theirs going up?"

French said it's a difficult formula to decipher, but it basically means that if the education tax rate goes down, the Bruce site pays less in taxes to the municipality. She said council could approach the provincial finance minister and ask for a tax rate on the regulated assessment, or request compensation to off-set the loss in revenue.

"So, that's who the taxpayers should complain to - the province," said Anderson.

Deputy mayor Laura Haight said she sat down with the treasurer and discovered that over the past four years, the municipality's capital budget has decreased by 30 per cent, while operating expenses have increased 0.8 per cent.

"If we assumed we had the same budget next year, we'd be looking at an 18-per-cent increase, and we wouldn't have the $880,000 to take out of the tax mitigation reserve or any other reserves," she said. "We're not in a position of sustainability. What we have to look at is are we providing the right service at the right level. 

"I encourage council to take a deep breath and let's go at the budget with a broader discussion. The budget should reflect the values of this community and be sustainable going forward."

Councillor Randy Roppel said he would not support a 10-per-cent increase in taxation unless council can justify it.

"This municipality is living beyond its means," he said. "We should cut a bit more. Neighbouring municipalities have tax increases but they are justifiable."

Councillor Gordon Campbell suggested taking money out of the $450,000 signage program or the reserve set aside for the tourist booth.

Roppel clarified that there is only $36,000 in the budget for signage this year - the entire signage program is $450,000 over four to five years.

"We should be funding things like roads which are more important than the luxuries we're spending money on," said Campbell.

"Many businesses do not find signage to be a luxury," said mayor Larry Kraemer. "Signs to downtown are a necessity, not a luxury."

Councillor Marsha Leggett said Kincardine is considered to be a rich municipality because of Ontario Power Generation and the Bruce nuclear site, but for the four years she has served on council, she has seen no big amounts of money coming to the municipality from that site, unless you factor in the wages and assessed properties of the site's workers.

"That big conglomerate along the lake is not helping too much in taxes," she said.

She agreed that council should meet again to discuss the budget because there is a refund from the South Bruce OPP of $181,000, plus $14,000 to help pay for upkeep of the arts centre, which should be considered.

French said the refund from the police was included in the budget, at $175,000, meaning there's $6,000 extra which will be taken off this year's deficit.

Chief administrative officer John deRosenroll suggested allowing staff to take another look at possible reductions to various departments and bring a recommendation to council.

Haight said the elected officials should be the ones to wrestle with this. "We have to decide what services we provide and what we can cut," she said. "We have to determine whether our expenditures are actually 20 per cent more than our neighbours to the north, or are we artificially keeping the tax rate low."

Councillor Mike Leggett said council must distinguish between its needs and wants, and then determine what can be cut from the budget.

Staff would be able to take a quick look at the budget and bring back a recommendation to the next meeting April 14, said deRosenroll.

Councillor Kenneth Craig said his concern is that department heads will shave a bit off here and there in various budgets, while it would be more efficient to chop off one complete service.

French said the taxation bylaw must be in place by the end of April to line up with Bruce County council's timeline.

Council agreed to allow staff an opportunity to check over the budget and bring it back next week.

^{for world news, books, sports, movies ...}

Wednesday, April 07, 2010