After hearing this opinion from more than one municipal councillor in Grey County, I decided to publish this submission anonymously at the author's request. It is honest and well-researched but may not be popular or politically appetizing. And for the record, I agree wholeheartedly. - Anne Finlay-Stewart, Editor
Municipal Taxes – A certain investment in a prosperous future?
In municipal circles, political and otherwise, an annual topic of discussion is the property tax. A tax levied wherein you are required to pay a prescribed percentage of the value of your property to the municipality for the services it provides to you. From garbage collection to roads maintenance to arenas to the various events and festivals your municipality may sponsor. Taxes have been debated for ages and will continue to be debated for eons. They are, after all, one of life's certainties.
Having said that, every year in the aftermath of budget deliberations there is hardly a satisfied person to be found. The taxes are always too high, the municipality will always have too many employees, the roads will always be poorly maintained, and the list goes on. Some may call it daylight robbery, after all, the word "tax" is derived from the latin word "taxare" which means to steal.
Now I'll bring the discussion closer to Grey County. All nine member municipalities have finalized their budgets by now and without doubt most of these municipalities have passed their lowest rate increases in the last four years. That's how you can tell it's election year. All joking aside, some municipalities have potentially committed the gravest of errors in putting forth a budget that appeases the public. I can speak of Grey Highlands on a first hand basis because that is the municipality I call home.
Going into the 2018 budget, the previous rates for this term of council were 9.3% (2015), 5.6% (2016), and 9.0% (2017). Grey Highlands put forth the lowest increase at 3.5% in 2018. How did they do this? Not by cutting spending. Not by running a deficit, municipal councils do not have that luxury. Grey Highlands council decided, against staff recommendation, to move $155,000 from reserves to reduce the budget (see 17-280 from minutes of the December 6, 2017 meeting).
There is an argument to be made that the people of Grey Highlands needed a break after those three years of high increases. Therein lies the issue; instead of learning from those years, Grey Highlands may just have doomed its people to more of those years. The reason for the two years at 9% was, mainly, capital needs. A bridge here and a bridge there that didn't last as long as they were expected to and had to be replaced.
In 2013, Grey Highlands completed its first Asset Management Plan which theoretically manages an organization's assets to ensure that it is able to deliver a certain standard of service. It takes into account roads, fleet, equipment, etc. In 2013, the Grey Highlands AMP required an annual contribution of 1.4% for 10 years in order to achieve full funding. In the 2016 report the recommended contributions rose to 3.6% annually for 10 years, or 1.7% annually for 20 years.
This shows a complete lack of investment in the sustainability of the municipality. What we really need is a council willing to bite the bullet and make the tough decisions so that a future council does not have to make a meal out of a cannonball.
Our municipal governments have long been in the practice of robbing a future generation of sustainability in return for gaining favour with a current generation. Continuing down this road does not end well. The biggest example, of course, being Meaford. In more recent history, West Grey and Chatsworth also come to mind.
A recent news story on SouthGreyNews.ca had West Grey Mayor and Staff talking about passing what they deemed a responsible budget. Again, responsible meaning pleasing to the pocketbook rather than a fiscally and socially responsible budget. This claim is substantiated by the news that the West Grey Library system had to reduce hours across its four branches due to a lack of funding in the "responsible" budget.
Chatsworth is another municipality that has, historically, strived to keep taxes to a minimum. Consequently, they closed one of their arenas towards the end of last year.
The biggest example, one that I had to mention, and save for the end, is Meaford. Between 2003-2006 they had 0% tax increases. Great? Maybe not. Especially because they used reserves to maintain the 0% increases. Subsequently, they had about five years of 7-10% increases to replenish their reserves. In 2013, their local levy hit 9.9%. Some of their savings that year came from leaving four senior level positions vacant. Now that Meaford once again finds itself without a CAO, in an election year no less, there has been commentary suggesting that Meaford should continue without a CAO. That is a bad idea and for many reasons which I will save for a different time. At the time of this writing the Council of Meaford has decided to put off hiring a CAO until the new council takes office in December.
In conclusion, the next time your mayor says that your tax increase isn't going to cost more than a coffee a day, the question you should ask is, "Why not? Have the right investments been made?" The right answers to these will lie somewhere between staff reports and budget deliberations. The only way to get to those, though, is to get thee to the council meetings. I hope that the next time there is a budget deliberation in your municipality, the council will have more than empty chairs starring back at them.
Photo source: BMS report, July 2014