ELORA – Back in June, Centre Wellington council directed staff to use a 2.4% inflation rate when putting together the 2022 draft budget.
At the Oct. 4 committee of the whole pre-budget meeting, council learned it will be hard to hold the budget to that line.
Township treasurer Dan Wilson told council the consumer price index, used in setting the operating budget, was 3.3% in June and is now tracking at 4% “and is still rising.”
As well, the non-residential building construction price index, used in capital budget calculations, has risen from 3.1% in June to 7.7% today.
That brings the weighted index to 5% – more than double council’s direction to staff.
On top of that, insurance has increased by 12 to 15%, Wilson said.
“2.4% was the direction in June and we are working on that,” Wilson said.
“Eventually inflation will come down, but how long? If it’s not until 2023, that will put a strain on the township.”
Wilson said staff will still present the original draft budget along with the reductions it will take to get to 2.4%.
The budget book is to be ready by the end of November, with discussion and a final decisions to be made by council in December.
Wilson also confirmed a $150,000 increase to the budget translates to a 1% increase in taxes.
