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Sunday, February 23, 2020
Connecting Our Communities

Woolwich whittles down tax hike somewhat to 3.9%

Woolwich taxpayers are looking at a 3.9 per cent tax hike as councillors last week made a few tweaks to the budget, dropping it from a planned five per cent increase.

The new figure includes 1.5 per cent for a special infrastructure fund, 0.5 per cent for greening and 0.38 per cent for climate-action projects, leaving about a 1.6 per cent hike in the general levy. In total, the hikes would add $34.16 to the tax bill of an average home valued at $394,000.

Along with money from new growth and hikes in fees and charges, the township is looking to spend some 8.5 per cent this year over what was budgeted in 2019. That ongoing trend towards large expenditures, much of it on staff rather, is now being met with concern from some councillors.

Coun. Patrick Merlihan called the tax increase itself “misleading,” as spending increases are much higher, as they’ve been for some years. Extra revenue from the likes of assessment growth has been rolled into the operating budget without much thought, he said. Most of this year’s new revenue from assessment will go to hiring two more people for a staff complement that outstripped inflation and growth in the township.

“Our spending is significant,” said the Ward 1 councillor, adding another spate of growth means council should talk about where that money should go.

Coun. Larry Shantz shared his concerns about the spending priorities, arguing the process should be more transparent.

The township, he said, should avoid operating budget increases in favour of building up its savings in reserve funds to tackle more pressing problems such as the large infrastructure deficit.

“I think we need to have a bigger discussion about the reserves,” said Shantz.

For this year, councillors meeting in a special session January 16 opted to cut spending to projects such as new lights at Lions Park in Elmira, playground equipment and a ball diamond in Heidelberg to free up some cash for climate-related projects and still cut one percentage point from the initial budget target of a 4.99 per cent tax hike. After some back-and-forth again Tuesday night, the 3.89 target was maintained.

Reducing the tax hike was a priority for Shantz.

“We should take the levy back by a per cent,” he said. “We’re really struggling, in my mind, to keep the budget reasonable.”

A number of the cuts came from the recreation budget, which has been growing in leaps and bounds in recent years, with some councillors noting much of what’s included could be deemed a “want” instead of a “need.”

Recreation spending subsidized to the tune of $2.6 million this year, with large growth year over year, Coun. Murray Martin pointed out, adding action is needed to stop that trend?

“How far are you willing to let that go? Three million? Three point five million dollars?

“To me, that’s a want,” he added, calling for a review of the rec. budget. “I think we have to look at some of these things. Where do you want to go with it?”

“He’s absolutely right on rec. spending and trails,” Merlihan said of Martin’s comments.

Shantz said budgets that have put too much emphasis on wants have left needs unresolved, pointing to tens of millions of dollars in road and bridge repairs alone.

“Infrastructure is a need, playgrounds are a want,” said Shantz, who’s been arguing through the process that many of the playgrounds are fine and don’t need to be replaced.

“We seem to be on two sides of the fence,” he said, arguing to save the township can’t continue to spend on wants, build up savings and reduce the tax increases due to the path it’s on.

“If council’s wish is to spend, spend, spend, I’d like to know that,” he said.

On the topic of infrastructure, councillors rejected a staff suggestion to borrow $900,000 to pay for routine road maintenance projects.

“I’m a pay-as-you-go kind of guy,” said Martin, suggesting to avoid borrowing for road projects by applying $175,000 from gasoline taxes originally earmarked for rec. projects to cover part of the $900,000, then using the untouched working capital reserve fund to cover the rest. The township could then replenish the fund over time again.

“Infrastructure is the most important job the township does.”

Merlihan said he was disappointed staff hadn’t come up with alternatives to borrowing for road repairs, a concept he said he disliked as it wasn’t the same as investing in a new building, for instance. There was no suggestion from staff to put hiring on hold, for instance, let alone reduce staff spending, to help pay for real priorities or to eliminate $900,000 debenture.

“I wish someone in upper management had said ‘maybe we should put this on hold,’” said Merlihan.

He noted years of large spending increases have gone largely to staff rather than the pressing needs of the public. That’s true again this time around, he said.

“Our budget is staffing this year.”

Pointing to a recent organizational review, he said it was a foregone conclusion to press for more staffing rather than finding efficiencies and ways to reduce costs.

“I said it right from the start – this is just going to lead to more staffing,” said Merlihan, noting those spending choices in the past decade or so have consequences today.

“Our decisions … are coming home to roost now.”

Steve Kannon
Steve Kannonhttps://www.observerxtra.com
A community newspaper journalist for more than two decades, Steve Kannon is the editor of the Observer.

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