South Algonquin 2021 draft budget presented

·9 min read

At their March 3 council meeting, South Algonquin Township clerk and treasurer Holly Hayes presented the draft budget to council for 2021. She took council through the proposed budget step by step and fielded questions along the way. All told, the township’s current levy and the required levy to balance the budget for 2021 differed by $24,329, requiring a one per cent tax increase. Council will be discussing the draft budget and perhaps proposing changes over the next few weeks, and the final budget should be finalized by the township’s council meeting on April 7.

The budget process is done annually in South Algonquin, as it is done in other municipalities, and is approved by council in the spring. It includes an operating budget, which pays for the day-to-day operations of the township, including salaries, materials, energy costs and supplies. There is also the capital budget, which is the plan done each year for the purchase and financing of the township’s capital assets. These assets include infrastructure, lands, roads, municipal facilities, machinery and equipment.

Hayes outlined the objectives of the budget process, which was to meet the legislative requirements of the Municipal Act, 2001.

“We are required to set out at the beginning of the year what we’re going to do and how we’re going to spend and what we need to levy to do this. I’ll provide you with an understanding of where our revenue is coming from, what’s different this year, expenses, anticipated changes in all areas and then we’ll talk a little about tax rate and available funds,” she says.

Revenue was discussed, going back to 2019 and including the budgeted and actual amounts for 2020. Hayes said the main discussion around those numbers was COVID-19, as they had gotten additional funding from the province because of the pandemic and they didn’t spend because of it as well.

With regard to non-tax revenue, the township is budgeting $1,438,860 for 2021, which is $120,160 less than the amount actually spent in 2020. It is divided up into general government, protection services, transportation, environmental, health services, social services, recreation and planning. The disparity between 2020 and 2021 was because the 2020 budgeted amount for general government spending was $1,116,500 but they actually spent $1,254,007 due to COVID-19 and the extra amount was the funding they got in from government to deal with the pandemic.

“So, we’re hoping the province will kick up more funds for COVID-19 or that it will go away and we can go on without needing more money,” she says.

Partnership funds were next discussed by Hayes, which she explained mainly makes up the general government line within non-tax revenue. It is split up into OMPF (Ontario Municipal Partnership Fund), Court Security, OCIF (Ontario Community Infrastructure Funding), Gas Tax and Heritage. For 2020, the amount spent was $1,096,101, while the budgeted amount for 2021 is $1,116,200. Hayes said they saw in increase in the gas tax and the OMPF which accounted for the increase for 2021 of $20,099.

Next up, Hayes told council about grants that were expected and had been applied for in 2021. These were the Rural Economic Development grant for $15,000, the Northern Ontario Heritage Fund Corporation grant for $31,000, Canada Summer Jobs grant for $3,500, the Heritage Canada Day grant for $3,900, the Library Operating grant for $6,000, the Municipal Modernization Fund for $7,000, the Safe Restart COVID-19 fund for $37,000, and the OCIP Resilience Infrastructure grant for $100,000. Hayes explained these grants would not impact the budget as they were not in the budget at this point. If and when they get those grants, they will be brought to council through resolution and brought into the budget that way.

Operating expenses were discussed next by Hayes, and were divided up into variable expenses and fixed expenses. Of the variable expenses, there was fuel, hydro, goods, postage and legal. There was no change in all of these except postage, which Hayes said was always going up, and everything the township does is sent out by mail to residents. Of the fixed expenses, there was policing, wages, insurance, MPAC and DNSSAB. Policing and MPAC went down this year, while the others increased. According to Hayes, wages went up by two per cent, while insurance went up by 22 per cent. She called the latter a significant increase and a concern not only for South Algonquin but for every municipality across the province.

Levies paid for service amounted to 30 per cent of operating expenses, according to Hayes, and in 2021, they were up by $11.248. These were split up into the following categories; the OPP, the Health Unit, District of Nipissing Social Services Administration Board, Casselholme Nursing Home in North Bay and the MPAC.

Proposed Capital for 2021 amounted to $571,860. For administration, which included funds brought over from last years budget, signage (including wayfinding), asset management software and additional items like a floor scrubber and additional office space due to COVID-19 health and safety restrictions, amounted to $68,400. Protection services, including cutters, spreaders, helmets, bunker gear, dry hydrants and a new truck and truck lights, came to a total of $184,200. Transportation amounted to $214,500, while Recreation, which includes things like outhouses, benches, picnic tables, a fridge, curling equipment and the re-shingling of the Lester Smith building came in at $86,760. The library came in at $18,000, and included expenses like having the library’s roof re-shingled and new laptops and desktops, which were delayed from last year as the libraries were closed down due to COVID-19, and the township wanted to wait and get the most up to date computers for the libraries when they were allowed to reopen.

Transportation capital for 2021 was looked at, and Hayes turned the floor over to Dave Gatley, the public works superintendent. He said the engineering drawings for Hay Creek Road came in at $15,000, while the road and drainage improvements to the township roads amounted to $60,000. With township roads, he pointed out that the proposed work on Shields Road (drainage improvements and installing a snow plow turn) was not included in this estimate, as council had not yet voted on the resolution to do the work. Later on in the meeting, council did vote on this resolution and it was passed, adding $10,000 to the township roads amount for 2021. A road needs study and traffic counts came in at $16,000 and $11,000 respectively, while the sign inventory would cost $7,500.

Gatley said they were still waiting on the one tonne, single axle truck, which was due to be delivered this fall, at a cost of $75,000. He also mentioned his desire to acquire a slide in water tank to improve sand sweeping operations, at a cost of $30,000. This was a discussion that had already happened at the last Asset Management meeting, and council told Gatley to go ahead and look into purchasing the water tank so public works would have it by spring.

Reserve transfers for future capital purchases had also increased. Proposed reserve transfers were for the 2022 election, in the amount of $6,900. Under protection services, costs for the SCBA amounted to $20,000 a year, which will be returned to the reserves for 2018 to 2022. Equipment purchases for 2022 were estimated at $50,000. Under transportation, truck #27 came in at $50,000 a year, which will be returned to the reserves for 2018 to 2022. Costs for future road reconstruction were set at $133,535. Under health, funding for the helipad came in at $3,500, which is money from Ornge (Ontario’s air ambulance service and medical transport) which goes into reserve, and at some point, according to Hayes, a capital project will be undertaken to pave that facility.

Hayes noted a lack of fundraising able to be done due to COVID-19 and suggested putting some money from COVID-19 funding back into recreation. She suggested transferring $918.

There have also been some assessment changes. Hayes told council that MPAC was supposed to do a global assessment this year, but will not happen because of COVID-19. She said that MPAC is still picking up changes through building permits, property charges and severances.

“Our CVA was going up pretty steadily, then 2020/2021 happened, and it kind of evened it off. With real estate values in rural places increasing, we will see that increase in our own CVA,” she says.

The township’s assessment distribution is mostly residential properties with a Realty Tax Class of 1428, followed by payment in lieu at 77 properties (provincial properties that the township gets tax money on), exempt properties at 53, commercial properties at 50, managed forest at 33, industrial properties at five, farm properties at three and new commercial properties at two. With regard to the managed forest RTC, Hayes said that it was going up all the time.

“It’s a bit of a risk to our tax base because it reduces revenues. When these large properties are going into managed forest, that means the residential properties are picking up the tax they aren’t paying. So that’s kind of one that I’ve been watching,” she says.

Overall, the 2020 township levy was $2,432,806 while they require a levy of $2,457,135 to balance the budget for 2021. That difference amounts to $24,329, which would necessitate a one per cent tax increase. With that one per cent increase, a property with a CVA of $150,000 would see an increase of $13 a year on their tax bill, while a property with a CVA of $200,000 would see a $17 a year increase. The education tax rate remains unchanged from last year, so there is no increase for 2021.

Hayes said in a March 11 email that the only comment she had on the draft budget was that the process is getting better and staff had done a lot of work over the past years to improve and standardize the budget. While there has been no input yet from council, she hopes there will be more discussion at the April council meeting. She doesn’t foresee a special meeting happening to discuss the budget, although it may.

“Staff create the budget based on the information we have available including all the anticipated revenue and expenses, part of the process is council increasing, decreasing, or changing based on what they think is best. So, the process is really created for continued change until it’s passed,” she says. “I think the public perception is that staff should be offended or begrudge changes, when the reality is that we are doing our best to initiate the conversation and the process will go where it needs to.”

Michael Riley, Local Journalism Initiative Reporter, The Bancroft Times