CENTRE WELLINGTON – Taxes could be increasing by six per cent in 2024, although councillors hope staff will be able to reign that in to 4.5% as work gets underway.
At its June 26 meeting, treasurer Adam McNabb presented a report seeking direction from council on a several matters as staff begins work on the 2024 draft budget.
McNabb noted the Consumer Price Index (CPI) is 4.2 % and the Non-Residential Building Construction Price Index (NRBCPI) is 12.3% that together give a blended rate of 6.7%.
CPI tends to guide operating cost increases and NRBCPI guides capital costs, although staff try to get 2023 pricing for 2024 projects.
“Passing a budget with an increase that is lower than the weighted index results in inflationary increases being absorbed within existing funding levels, potentially leading to reduced service levels,” McNabb wrote in his report, adding that the 2023 budget had a 3.53% increase, which was significantly below inflation.
McNabb offered three options – 4.5%, 6%, or 7.5% as a starting place.
Council quickly threw 7.5% off the table but understood there would have to be a tax increase, though they’d like it to be low.
Councillor Bronwynne Wilton suggested directing staff to use a rate of 6% while working on the budget and include recommendations to reduce the tax rate to 4.5% and council approved.
Council also gave the follow direction as staff begins the 2024 budget:
– a 2% increase in taxation to mitigate the funding gap identified in the township’s 2022 asset management plan;
– a 1% increase in taxation for the termite management program;
– assume 2024 assessment growth equal to 2.5%;
– increase fees and charges for 2024 by 6.0%, with recommendations to reduce to 4.5% where possible;
– maintain a three-year funding average of $1.9 million in growth-related capital projects to be funded by development charges within the draft 10-year capital forecast;
– allocate $7.9 million from the general capital reserve, the Canada Community-Building Fund, OLG Fund, and the Ontario Community Infrastructure Fund to the draft capital budget; and
– increase the tax supported equipment, vehicle, and facility replacement reserves to support budgetary needs.
Council will review the preliminary budget in September; it will be open to public comment in October; and will be approved by council in December.
