Economic Snapshots - Budget 2019


At the Special Committee of the Whole meeting on January 22nd, 2019 Treasurer, Shannon Johnson introduced Version 1 of the Township's Draft Budget. Treasurer Johnson explained she saw no challenges in the Operating Budget, but that there is a significant amount of infrastructure work that will need to be done in coming years. Treasurer Johnson said that Council will either have to implement a tax increase or reduce services in order to fund Capital needs.

Initially, the draft budget called for a tax increase of 5.12% or $1.61 per every $100,000.00 of assessed property value. This figure is comprised of a 0.12% tax levy and a 5% capital levy contribution being added to discretionary reserves and did not include funding for a request for two new employees.

The Muskoka Ratepayers' Association wants to share with you some of our observations from Version 1 of the Draft Budget and the meeting. Here is what caught our attention:

Council remuneration has increased by 28.3%. The previous Council voted in favour of this increase to compensate Councillors who will no longer receive one third of their Township pay “not taxed”.

The main drivers in the Operating Budget are:

  • costs for a new Township website $49,500
  • webcasting service for the Council Chambers $13,940
  • a new public works assets management system $104,600
  • a new electronic content management system $60,000
  • the Township's portion of the Minett Steering Committee $125,000
  • a large increase in legal and insurance costs $350,000, and
  • an increase to reserves for the replacement of/or new capital infrastructure $219,000

Members of the Committee of the Whole reviewed the Operating Budget department by department. Here are the changes that were made: An addition of $1,000 to the Trails budget and $8,000 earmarked for a consultant in Emergency Management was removed. Requests for a solar powered event entrance sign at the Minett Community Centre at $12,000, a new event sign at the Torrance Community Centre at $5,000, an emergency generator at the Walker's Point Community Centre at $75,000 and $20,000 for the Chamber of Commerce Visitors Centre were all to be reviewed by staff and reported back to committee at the February 11th, 2019 Budget meeting.

Councillor Nishikawa requested that monies in the budget for the Muskoka Lakes Chamber of Commerce be reduced significantly. Councillor Kelley pointed out that the Chamber is instrumental in helping build the tax base in the Township and should receive support. Councillor Zavitz agreed with Councillor Kelley and no change was made.

As in past years the Township budget included a request from the South Muskoka Hospital Foundation for “matching funds”. The Township will accept donations for the Foundation and “match” all donations up to a maximum of $9,000. A line item of $9,000 was included in the budget.

Director of Public Works, Ken Becking, reported that at a senior management meeting on January 15th, 2019 he removed bridge repairs to the Bala Falls Road Bridge and the Beaumaris Road Bridge from the budget. Mr. Becking acknowledged that the bridges require repairs but stated they were not as urgent as once thought. Nor does the Township have the capacity to complete all three projects this year. As the Milford Bay Road bridge was in greatest need of replacement, that project was left in the budget.

The Capital Budget was then reviewed and changes made to the Fire Department and Emergency Management. Fire Chief Hayes explained to committee that Torrance Pumper #4 (a mini-pumper), an addition to the Raymond Fire Station, Bala Rescue #3 (a 3/4 ton truck) and a generator for the Raymond Fire Station could be removed. The required changes could be facilitated by relocating a pumper truck from the Glen Orchard Fire Station to Torrance and transferring the “mini pumper” from Torrance to Glen Orchard. The addition to the Raymond Fire Station, which was a “carry over” from the 2018 Budget, is on hold as the land on which it was to be built is not in the ownership of the Township. Therefore, the fire truck that has previously been ordered for Raymond can be re-allocated to Bala. Because the addition is not being built the generator for the Raymond Fire Station is not required at the moment.

Committee then reviewed the 10-Year Capital Forecast which shows the Township will be in a deficit position by 2022. Councillor Jaglowitz commented that he could not support a budget that was unfunded. He felt there were items in the Operating Budget that could be reduced and those monies could be transferred to reserves, and offered to work with staff in doing so. His offer was declined.

The Fire Department's 10-Year Capital Forecast budget came under scrutiny when Mayor Harding asked for comments on an aerial fire truck and Marine 1. Chief Hayes reported that he had done a 20-Year Capital Forecast for the Fire Department to keep costs “flat-lined”. Chief Hayes explained that in his mind the aerial fire truck is already necessary in the Township as the length of the Fire Department's ladders only reach the window sill of a third storey window. Furthermore, Chief Hayes stated it is easier to fight a fire from above and for safety reasons he will not permit Township volunteers to climb up on roofs. Chief Hayes explained that the longer Committee/Council deferred this purchase the more expensive it will become. The aerial truck was removed from the 10-Year Capital Forecast.

Regarding to Marine 1, a fire boat located in Foot's Bay to service Lakes Joseph and Rosseau, Chief Hayes stated that the existing fire boat is small which limits the transportation of equipment and volunteer fire fighters. Marine 1 was scheduled to be replaced in 2024, but now has been removed from the 10-Year Capital Forecast.

Following the completion of the budget review the Planning Department and Fire Department both presented requests for an additional staff member. The Planning Department's request was approved, while the Fire Department's request for a coordinating training officer was denied.

Treasurer Johnson reported to Committee that in 2017 the Provincial average for discretionary reserves was 58.7%. The Township's discretionary reserves are currently 14.5% below that average at 44.2%.

Councillor Hayes explained to new councillors that when the Province comments on reserves they do not take debt load into consideration. The Township has very little debt and therefore would be able to borrow monies if required.

With the changes made to the Operating and Capital Budgets, the levy, including the 5% capital levy, has currently increased to 5.81% which equates to $2.41 per every $100,000.00 of assessed property value. With changes to the 10-Year Capital Forecast it is not currently showing a deficit.

Remember that your time to comment on the budget, which is available here - 2019 Budget - Draft 1 2019 Budget - Draft 1 - is at a Special Public Council Meeting on Tuesday, February 5th, 2019 at 7 PM in the Council Chambers.

Another draft of the 2019 budget will be presented to committee for further review and discussion at a Special Committee of the Whole meeting on Monday, February 11th, 2019. Any changes to the levy will be posted on our website, once they are received from Treasurer Johnson.

The budget will then be discussed at Committee of the Whole on Thursday, February 14th, 2019.

It is anticipated that the final budget will be passed at Council on Friday, February 15th, 2019.

 

Upcoming Events - Monthly Calendar

Ratepayers - Board Meeting
Jun 22, 2019 9:00am to 1:00pm
TML - Committee of the Whole
Jul 11, 2019 9:00am to 12:00pm
TML - Council
Jul 12, 2019 9:00am to 12:00pm
Ratepayers - AGM 2019
Jul 20, 2019 10:00am to 12:00pm
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