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Woolwich sees 4% tax hike next year

It’s early in the process, but Woolwich is eyeing a four-per-cent tax hike for next year.

If that stands, the average homeowner would pay an additional $20 a year on the municipal portion of the tax bill, rising to $517 from $497. The local share represents about a fifth of the overall tax hit, with half siphoned off by Waterloo Region and 30 per cent by the school boards.

The four-per-cent figure was part of a discussion Tuesday night as councillors got the 2010 budget process underway. That represents a two-per-cent tax increase and the two-per-cent special levy for Woolwich’s slate of new recreation facilities. Next year is the final one for the extra charge.

Along with the tax proposal, finance director Richard Petherick reported the township posted a small surplus in its 2008 fiscal year, audited statements for which were tabled this week. After an operating deficit of $111,000 was offset by a capital projects surplus of $133,000, Woolwich was left $22,000 to the good.

For 2010, Petherick recommended that council maintain current levels of service, building on this year’s budget of $33.7 million – $10.2 million in operating expenses, $18.3 million for capital projects and $2.7 million for water operations.

A two-per-cent hike in the general levy would cover an inflationary increase in expenditures for next year, he said, noting this would allow the township “to essentially hold the line.”

Councillors seemed in general agreement with the target, although Coun. Murray Martin suggested staff look at only the two-per-cent capital levy, freezing other increases.

A six-per-cent hike for 2009, coupled with four per cent for 2010, makes an average annual increase of five per cent in the last two years, far above inflation and extra burdensome in a recession where people are losing their jobs, he said.

“I took a lot of flak from people last year,” he added of the six-per-cent tax hit.

More amenable to Petherick’s proposal, Coun. Mark Bauman said a status-quo budget could work.

“Four per cent, for me, is the cap on what the budget has to be,” he said of the upper limit on next year’s tax increase.

Coupled with a forecast for the lowest assessment growth in five years – 2.5 per cent, down from a high of 5.91 per cent in 2007 – the township will be hard-pressed to maintain levels with a four-per-cent hike, but it should be possible, said Petherick.

The budget process is somewhat constrained by the fact more than 50 per cent of costs are tied to staffing. The current three-year contract, which expires next year, provides for a three-per-cent pay raise. When contract talks begin later this year, he expects a much sharper pencil to be used, with much lower rates.

Even at four per cent, however, residents are still likely to protest against the tax hikes given the economic conditions, suggested chief administrative officer David Brenneman. “Four per cent is not going to sit well with the public.”

That despite a forecast – based on four per cent in Woolwich and two per cent elsewhere – that shows only North Dumfries residents would pay less than Woolwich taxpayers – $344.07 versus $516.56 – on the municipal portion of property taxes. Wellesley Township residents would pay $705.11; Wilmot $595.03; City of Waterloo $876.76; Kitchener $933.36 and Cambridge $938.79. Nearby municipalities outside Waterloo Region are also forecasted to be higher: Centre Wellington at $659.03 and Mapleton Township at $721.62.

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