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Kincardine holding pre-budget meeting Dec. 3
By Liz Dadson

Town Council Kincardine

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Kincardine is facing unprecedented financial challenges in 2010 so council is holding a special pre-budget meeting Thursday, Dec. 3, to start hammering out the budget process.
 
In committee-of-the-whole Nov. 18, chief administrative officer John deRosenroll said council is looking at a possible revenue loss of $1.5 million next year. This includes $621,000 from the Ontario Municipal Partnership Fund, $225,000 from the tax mitigation fund (year one), $150,000 reduction from Bruce Telecom, $373,000 payment for the Kincardine Community Medical Clinic addition, and $100,000 investment income reduction. This does not even include the 2009 year-end surplus/deficit.
 
Staff has been directed to prepare the 2010 operating budget at 6.5-per-cent less than the 2009 budget, said deRosenroll, and capital expenditures are being reduced by $500,000.
 
The special pre-budget meeting will run 5-8 p.m. in the council chamber, said deRosenroll. Council will receive information about the financial plan for next year's budget process in advance. At the meeting, the CAO and treasurer will review the financial pressures facing council, and the treasurer will review the status of the Kincardine reserve and reserve funds. Each department chairperson and respective senior manager will present to council a pre-budget financial savings plan.
 
The financial department will operate an Excel Tote Board and council decisions will automatically reflect an increase or decrease in the pre-budget tax rate. Each $53,000 change will reflect a one-per-cent difference in the tax rate.
 
In a draft 2010 pre-budget financial plan, staff is looking at a tax rate increase of 6.56 per cent in order to meet the financial challenges next year, said deRosenroll.
 
Mayor Larry Kraemer said the provincial government is looking at the cuts to municipalities through the partnership fund to see if something can be done to mitigate the impact. "We're supposed to have a response by Nov. 30 (today)," he said. "The government is changing the way money is being distributed - some municipalities are getting more and others are getting less."


Treasurer Brenda French said earlier that council took $647,000 out of the tax mitigation reserve in 2008 to complete several projects. That reserve could be depleted quickly unless council gradually draws from it, she said. So, the plan is to take only $400,000 from the reserve, meaning a reduction of $225,000 in financial support for the budget.
 
"We're looking at a two-pronged approach," she said. "We want to balance the increase in the tax rate, but retain an acceptable level in the reserve funds. We will be reviewing reserves and reserve funds to ensure we are comfortable with what we have set aside."
 
In other funding-related issues, council has agreed to apply for a grant through the Bruce Community Futures Development Corporation. The new grant program is aimed at projects that will have a long-term impact that will create jobs, boost the local economy and increase local business competitiveness.
 
Steve Murray, economic development and tourism manager, said the Bruce Energy Centre utility transfer project would tie in well with this grant. Council okayed applying for a grant of up to $50,000 to cover any legal and professional fees that may be incurred should the municipality decide to assume ownership of the Bruce Energy Centre utilities.
 
Murray also recommended council apply for the second round of the Southern Ontario Development Program. The first round has a project completion date of March 31, 2010 and is not practical for Kincardine, he said. The province is expected to release the second round of grants, with $60 million available, affording the municipality the time to submit a thorough application.
 
This grant, which requires matching funds from the municipality, could be used to expedite capital improvements ($930,000) related to the Bruce Energy Centre utility transfer project, said Murray. The airport committee also wants to apply for funding for fuel system upgrades ($140,000) at the airport and Murray suggested the municipality should apply for a fuel tank removal program ($15,000) at the former Westario Power building.
 
Council approved applying for the grants.
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