Council members told staff to keep the blended tax rate for 2021 low – with requests ranging from zero to “two or three” percent.
As it presented by staff, the draft budget contained a three percent increase in the Southgate levy for capital projects, which would likely be a two percent in the blended tax rate.
CAO Dave Milliner asked council for direction at the end of the special meeting on the proposed capital budget held on Tuesday, Nov. 24.
Coun. Michael Sherson said his ideal would be to give residents a zero increase this year.
Coun. Barbara Dobreen said she didn’t want to see township reserves depleted to keep the increase “artificially low.” She suggested a 1.5 percent increase – “keep it under two (percent) for sure.”
Deputy-Mayor Brian Milne asked if the 2020 impact of growth was known. The more building in the township, the more property owners to share the burden of the tax levy.
Treasurer Liam Gott said it would be a few weeks before he had final figures but he expected 2020 added about $159,000 in taxation dollars based on the value of building permits issued (lower than the $280,000 projected).
The deputy-mayor said that while a zero increase is desirable – “I don’t think that it’s reasonable or even responsible.”
“Our costs are going up,” he said, naming fuel, hydro, insurance and payroll. Given that, he said he’d like to see something around 2.5 to 3 percent.
At that point, the treasurer asked whether councillors were talking about the increase for local use or the overall or “blended” increase that includes taxes Southgate collects and passes on to the county and the school boards.
At this stage in the budget process, council has seen and discussed capital costs, with the operating budget still to be seen.
Coun. Martin Shipston said that a 2.5 to three percent increase would be reasonable, and not leave residents paying more down the road to make up for a lower increase in 2021.
Coun. Jason Rice said he would like to see a zero increase.
Coun. Dobreen had mentioned the Cost of Living increase for employees, which would be based on the inflation rate of 0.7 percent.
Coun. Rice said that maybe for one year, township employees could do without the COLA increase.
”I’m not going against them (staff) – they do a fantastic job,” he said. “It’s this year, this specific year – this pandemic we’re dealing with,” he said.
“It’s not our money in this time of need,” he said. He said many Southgate residents never get a Cost of Living increase.
Deputy-Mayor Milne said perhaps this was the year to pull back on COLA or “step” increases based on performance and years served.
He said that council needs to see the operating budget estimates to make its final decision. To achieve zero would take cuts to services, he said. “What services are we going to cut back on?”
“Fuel, hydro, insurance – other expenses like that we have no control over and we have to pay."
Coun. Rice asked the CAO for his reaction. Mr. Milliner replied, “if I didn’t hear a comment from council like that I would be surprised.”
He did speak in defence of merit or “step” pay increase, adding that he himself is not affected by that policy.
Mayor John Woodbury said that council had to balance the need for restraint in the present moment with the risk of postponing needed changes and mortgaging the future.
“Overall, two to three percent is acceptable,” he said.
M.T. Fernandes, Local Journalism Initiative Reporter, Dundalk Herald