2010-01-14 / Editorial

A tough year for budgeting

IDEALLY, DUFFERIN’S other two towns will follow the lead of Mono in coming up with a budget that requires no increase in the average ratepayer’s tax bill for town services.

However, as matters stand that’s an ideal that won’t be achieved.

In the case of Orangeville, the best the current council has been able to achieve in its first three years has been increases above or about the current inflation rate — 6.8 per cent in 2007, 4.9 in 2008 and 2.8 in 2009.

However, those increases came at a time when the county town was dipping into its reserves, to the point where Councillor Scott Wilson has described them as currently “pitifully low,” and called for them to be restored to traditional levels. And while the current council has been steadily reducing the Town’s debt load, to a current $$19.5 million from $21.4 million in 2007, it’s hard to see how the roughly $1 million annually can be found under current economic conditions.

The Town’s reserves took a hit in 2009 when the council took advantage of substantial federal and provincial infrastructure grants to undertake necessary, but expensive, capital projects which are usually financed in equal portions by the federal, provincial and municipal governments. Although the federal and provincial stimulus programs are still under way, the council may well find itself caught in a position where it must choose between debentures and election-year tax hikes to take advantage of the stimulus money.

Meanwhile, as Orangeville council embarks on its 2010 budget debate, Shelburne’s budget, as currently drafted, is about $175,000 more overall than the budget for 2009, representing a spending increase of about 4.5 per cent.

For 2010, Shelburne council intends to apply the same tax rate as it did last year. Thanks to the 2007 property reassessment by the Municipal Property Assessment Commission (MPAC) this is would mean, on average, that homeowners collectively will pay 5.3 per cent more property tax for local services this year than they did in 2009.

The town’s draft budget, released to a public meeting Monday night, shows a 9.8 spending decrease in the operational side of things, and an 82.1% drop in the amount allocated to reserves. But those reductions are more than offset by a 129 per cent rise in capital expenses.

Although all municipal politicians will strive to keep tax increases to a minimum with an election set for next October, succeeding in the effort will clearly be easier said than done.

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