WELLINGTON NORTH – With the provincial government maintaining the township’s 2021 Ontario Municipal Partnership (OMPF) allocation at nearly the 2020 level, staff and council here won’t need to cut capital spending as deeply to keep next year’s municipal tax levy increase under two per cent.
Finance director Adam McNabb updated Wellington North council on budget developments at the Nov. 9 meeting.
At the previous meeting on Oct. 26, McNabb explained cutting forecasted capital spending is among the ways council could reduce a potential levy increase for the coming year.
“In order to facilitate a zero per cent increase on the existing taxpayer, we would effectively have to drop contributions to capital from the $2.3 million mark to about the $1.7 million mark,” McNabb told council at the time.
On Nov. 9, McNabb advised council of several changes that impact 2021 budget projections.
Staff are now factoring in a higher anticipated conservation authority levy, assuming a flat 7% increase from local authorities.
McNabb said a lower-than-expected increase in group benefit costs for employees is now projected based on revised negotiated rates from the plan administrator. The increase is now projected at 4.2%, rather than 10.7%.
The OMPF allocation was announced on Nov. 3, with Wellington North learning its allocation was being reduced by only .05%, rather than the 15% included in earlier projections. Wellington North received $1,283,700 from OMPF in 2020.
On Oct. 26, McNabb said 2021 operating pressures were expected to push up the levy by just over $700,000. However, on Nov. 9 he lowered that projection to an increase of $517,562.
The revised figures mean that to maintain a 1.52% levy increase for 2021, levy-funded capital program contributions will have to be cut from about $2.3 million to $1.9 million, rather than $1.7 million.
McNabb said major pressures on the 2021 budget are an anticipated loss of about $300,000 in recreation revenue due to pandemic-related closures/restrictions.
CAO Mike Givens said council had some wiggle room to use debt or reserves, or to switch out scheduled projects for “council-directed” projects in order to do more capital work in 2021.
He said what staff needs is “concrete input” from council on which projects it wants to proceed.
Councillors were asked to share their thoughts with Givens and McNabb over the next couple of weeks.
Mayor Andy Lennox expressed concerns “about backing off the throttle a little bit” for fear of falling behind on capital projects.
However Givens noted the township has been “very aggressive” on capital projects over the past three years.
McNabb noted that taking extra time to finalize capital spending plans could mean council would need to add a special meeting in December in order to pass the budget before the end of the year.
