Barrie homeowners face a 3.67 per cent property tax increase next year as councillors begin budget talks.
On a typical city home assessed at $362,740, this is an increase of $164, bringing property taxes on that house to $4,644 in the coming year.
Councillors begin talks on the 2022 operating and capital budget Monday night, and are scheduled to pass it at the Dec. 6 city council meeting.
Between now and then, much is expected to happen and change.
“I’d like to bring the tax increase down,” said Mayor Jeff Lehman. “I’m conscious that inflation is increasing, which adds to the city's costs, but clearly between housing prices and the price of food and other costs, our residents are already being hit with higher cost of living.
“Higher taxes also make housing costs worse, and we know how serious the housing crisis is," he added.
That blended (municipal/education) 3.67 per cent increase includes the 0.75 per cent dedicated infrastructure renewal funding, used to replace and renew Barrie’s roads, pipes and buildings, and is worth $2.2 million next year.
Coun. Clare Riepma said council has some tough decisions to make beginning Monday.
“The staff request is for a 3.67 per cent (increase) and council will have to wrestle with that request,” he said. “Last year, the tax increase was just less than one per cent, but we cannot continue that way and we cannot continue to borrow from the future. Residents want and need services and we need to continue with maintaining our roads and infrastructure.”
“Reserves may help, but only by addressing one-time costs,” Lehman said. “We can’t rely on reserves to pay for operating costs for the long term. Clearly transit revenue shortfalls need to be funded, hopefully Safe Restart (pandemic) funding can help with this, but this may be an area where we need to reduce service at least until the pandemic is over, unless outside funding is available.
“We are currently at about 85 per cent of regular service but only 45 per cent ridership,” the mayor added. “It may be necessary to bring those numbers closer together.”
“I would like to reduce the tax increase, but it won’t be easy. I am still looking at the details,” said Riepma. “We have made some good progress on our capital budget, and I expect there will be similar discussions about (the) operating (budget).”
At a special general committee meeting Nov. 20, councillors identified an estimated $252 million in capital spending that could be postponed until after 2031.
Lehman noted the budget does have service level improvements, but he’s unsure they can all happen in 2022.
“Service levels are the most important budget issue, as these drive our year-over-year costs,” he said. “I think the new services all have merit, but may need to wait a year given fiscal pressures. Raising service levels right now may not be affordable, for example the new winter maintenance for catwalks, and some of the (former Innisfil land) transit service.
“I’d like the city to raise these service levels, but we’ll need to balance how much we do there against the cost to taxpayers.”
Possible service level improvements in the 2022 budget include reopening Georgian Theatre for $214,500, aerial spraying for gypsy moths, which ranges in cost from $53,000 to $1.1 million, depending on how much of Barrie gets treated, hiring four more bylaw enforcement officers at $339,837 and additional zoning and enforcement officers at $174,379.
Deputy Mayor Barry Ward also said councillors face a stiff challenge with the budget and the projected tax increase.
“I think a 3.67 per cent increase is a bit high, although not out of line in terms of the rate of inflation today,” he said. “There’s not a lot of areas to cut without reducing services and, if you look through the budget comments we’ve received, most residents aren’t asking for decreased services.
“In fact, they want more money spent, especially on things like roads,” Ward added. “We aren’t adding many new services. I’ve long been a supporter of plowing walkways that connect to schools; it never made sense to me that we prioritize vehicles on streets over pedestrians when it comes to plowing.”
The Ward 4 councillor also said not every new service could be affordable next year.
“I’m a bit alarmed at the projected cost beyond this year for the transit-in-demand for the growth areas in the south end of the city, but we should be providing new areas with transit service and this is a cheaper alternative than regular transit service on routes,” Ward said.
“To get the projected tax increase down, we might have to consider at least delaying some of the increased services or finding other ways to fund them, beyond this year’s property taxes,” he added. “At the same time, I’m not an advocate of going into debt beyond what we are now anticipating. The decisions we make Monday won’t be easy.”
Barrie’s forecast 2022 total debt is $366 million.
Coun. Gary Harvey also said there are tough decisions to make at budget time.
“I will have difficulty in supporting anything that is above the rate of inflation,” he said. “This year is going to be another difficult budget year as we can only tap our reserves so far before it places us in a precarious position for the future.
“We all really need to dissect every ask and determine what is a must have and what is a nice to have.”
Coun. Natalie Harris said there is still much work to do on the budget and any property tax increase.
“It's important to remind the residents of Barrie, that these numbers are very preliminary — city council hasn't even begun budget talks as we are still reviewing the information presented to us by staff,” she said. “We will always strive to keep taxes as low as possible, while maintaining the levels of service we provide to the residents.
"Yes, that may sound like a very politically correct statement, but this is the actual case.”
The budget also includes increases for water and wastewater (sewer) rates next year — 2.4 per cent or $8.75 more for water, an additional 3.03 per cent or $15.61 for sewer, for a typical household that consumes 180 cubic metres of water annually.
So the annual cost of Barrie’s water and wastewater services in 2022, on this typical household, are estimated at $374 and $531 respectively, for a combined cost of $905. This is $24.36 or 2.77 per cent more for both services compared to 2021 levels.
The 2022 tax-supported base operating budget for Barrie’s municipal operations has gross expenditures of $393 million and a net property tax levy requirement of $267 million, or a $12.7-million increase compared to 2021.
This includes $58.9 million for Barrie Police Service, $25.05 million for the County of Simcoe — which provides social housing, ambulance services, Ontario Works, etc. — and $9.2 million for Barrie Public Library.
The 2022 capital budget totals $342.4 million — including $141 million in previously approved funding, $201.1 million in new funding requests and $332,000 associated with new investment and service recommendation operating budget requests.
Council’s approval of new projects in the 2022 capital budget would include the funds required in 2022, 2023, 2024, 2025, and 2026 to conduct the work, totalling $201.1 million.
Helping offset the property tax increase is estimated assessment growth of $3.6 million next year.
The 2021 property tax increase was 0.92 per cent — 0.67 per cent for city services and service partners; police, libraries and Simcoe County services like social housing and land ambulances — and 0.25 per cent was for the dedicated infrastructure renewal fund.
