Centre Wellington residents with an average assessment of $331,205 can expect their overall tax bill to jump by nearly $90 this year – but only $37 is attributed to a rise in the township portion of the levy.
On Feb. 2, Centre Wellington’s committee of the whole recommended adoption of the 2016 budget, which includes a levy with an overall increase of 3.89%.
That amount includes the dedicated 2% capital levy to be directed towards the replacement of bridges.
Once the county and education portions of the bill are included, the blended tax rate increase is 2.43%.
The most recent set of discussions began Jan. 26 and 27 and continued on Feb. 2. Mayor Kelly Linton stressed the 2% capital levy is being used on pre-selected bridges based on priorities established in the township’s asset management plan.
He said the proposed increase “allows us to stay on track and complete eight bridges within this term of council.”
Linton said staff presented a solid budget “that gives us the information we need to make good decisions as a council.” He stressed these are taxpayer dollars being spent, “and whenever possible we have to take a citizen’s perspective on this.”
He added people want to see how their tax dollars are being spent. “And they want to see that tax dollars are being spent on things that make sense to them.”
Linton said “the overall feeling I get is that citizens understand that taxes are necessary, but they do need to feel a level of comfort that we are setting the right priorities and that we are doing our best to stretch their tax dollars as much as we can.”
In his original report to council, Centre Wellington financial manager and deputy treasurer Mark Bradey stated the 2016 draft included a 2.48% increase in the base tax levy plus the 2% dedicated capital levy.
On Jan. 27, council directed staff to come back with a number under 2% (for the base tax levy increase).
Bradey noted the following significant issues impacting the 2016 draft tax-supported operating budget:
– Ontario Municipal Partnership Fund (OMPF). The township’s OMPF funding will be reduced by 15% ($91,800) in 2016 to $520,200;
– transfers to equipment and vehicle lifecycle reserves represents a $55,000 increase from 2015. The replacement reserve transfers are required to ensure sufficient funding to replace end-of-life vehicles and equipment in this, and future budgets; and
– wages and benefits. Consistent with other municipalities, Bradey stated, employee remuneration accounts for almost half (44%) of the tax-supported operating budget.
Significant changes related to wages and benefits in the 2016 operating budget include a full-time, contract, building permit position with a total estimated wages and benefit cost of $58,500.
This position is fully funded by an $85,000 increase in 2016 budgeted building permit revenues for a net savings of $26,500. As building department activity has increased significantly over the past few years, an increase in support staff is required to meet legislated permit timing approvals, officials say.
The user pay operating budget also proposes the inclusion of two, four-month contract co-op students and a nine-month contract for a risk management inspector. The impact on the environmental operating budget of these positions is $30,500 as 50% of the cost will be funded from the existing Source Protection Municipal Implementation Fund (SPMIF) grant capital project.
Bradey noted hydro and water expenditures have increased by approximately $81,000 with $60,000 of the increase at the Centre Wellington Community Sportsplex in Fergus.
Gravel resurfacing expenditures are proposed to increase by $20,000 to remediate washouts and spring thaw impacts to gravel roads and to improve the overall condition of gravel roads.
Stray animal control costs are expected to increase by approximately $45,000 in 2016. This is due to an expected change in the township’s administration of animal control.
Interest earned on the township’s cash balances is expected to decrease by approximately $40,000 in 2016.
A low-interest-rate environment has negatively impacted the township’s ability to renew GICs at rates previously in effect, officials say, adding this trend is expected to continue in 2016.
This reduction is partially offset by an increase in investment revenue from interest earned on the Victoria Park Seniors Centre loan from the reserves. Interest earned on township loans in 2016 will increase by approximately $22,300.
Snowplowing and snow removal at the new Fergus Riverlands parking lot requires smaller, more mobile equipment than the township currently owns. Therefore this new expenditure in 2016 has been contracted out at an estimated cost of $16,000 for 2016. This cost increase is reflected in the Fergus downtown cost centre in the draft budget.
Naming rights
The township is currently working with a consultant to secure an estimated $50,000 per year in naming rights for various community services facilities. The 2016 parks and recreation budget reflects a half year ($25,000) of sponsorship revenue. These funds have been transferred to the Parks and Recreation Facility replacement reserve to be used for future lifecycle replacement. As a result the impact on the operating budget is nil, officials say, and this alternative source of funding will be used to reduce the township’s infrastructure deficit.
The relocation of the tourism office results in estimated occupancy cost savings for the township of $26,600. The majority of the savings are due to the elimination of monthly rental payments and annual property taxes.
As the Centre Wellington Community Sportsplex continues to age, the funding required to maintain the facility continues to increase. Budgeted repair and maintenance expenditures at the facility are expected to increase by approximately $22,000. This includes a $5,000 increase in parking lot snowplow costs and a $9,000 expenditure for HVAC maintenance costs in the aquatics centre.
Due to the Wellington-Dufferin-Guelph Public Health unit’s requirement to increase service levels for sanitizing and cleaning certain areas of the Sportsplex facility, the aquatics centre and weight room cleaning is to be contracted out in 2016. These costs are offset by a reduction in parks and recreation part-time staff wages and benefits in 2016.
As council continued its discussions on Feb. 2, staff came forward with a number of recommendations intended to reduce the overall increase of the township portion of the levy from 4.48% to 3.89%.
The reductions lowered the average tax bill by $5.62 from was what was presented to councillors last week.
While much of the presentation included cuts to departments, another portion included projected additional revenues from unanticipated events being booked at the Fergus Sportsplex.
Although Bradey’s presentation was relatively brief, there was considerable discussion by some councillors on why there were not even more reductions.
While concern was raised whether about the municipality should be drawing from capital reserves to offset operating costs, the flip side was that other councillors voiced concern with the tradition of using operating surpluses to boost the capital reserves.
Councillor Mary Lloyd was pleased to see the revised budget not only included cuts, but new revenue streams.
“It adds a positive look to moving forward,” said Lloyd.
She questioned the lack of increased funding for planning and the economic development department.
“It could be a concern there is no increased funding … but there are higher expectations on a delivery for services,” she said.
Centre Wellington CAO Andy Goldie said the direction of council was to reduce the budget to under two per cent.
He said making these kinds of cuts is difficult on the budget. “Given that direction, I cannot see how we can increase that.”
Linton said just because there is not an increase to the economic development budget does not mean things are not happening.
He added there might be an increase or decrease next year.
“We have to establish our economic development activities – how they are different and how they tie in,” said Linton.
Councillor Steven VanLeeuwen remained “leary of reducing our budget too far.”
If that happens, “We run the risk of coming too close to a shortfall, which would automatically reduce our capital spending,” said VanLeeuwen.
“Lowering our operating budget too far would risk using up the reserves.”
Following considerable discussion, council agreed to adopt the 2016 budget.
