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Council presented with 3.1% tax increase for 2023 Budget

December 15, 2022   ·   0 Comments

By Sam Odrowski

Orangeville council had its first look at the 2023 Budget last week and is currently looking at a 3.1 per cent tax levy increase, representing a $1.1 million shortfall.

Town treasurer, Nandini Syed noted that the increase is much lower than Canadian inflation, currently trending at 6.9 per cent, when she delivered her budget presentation on Dec. 5.

“We are actually less than half of what the current inflation is and this council will have more opportunities to deliberate on the actual levy increase and where it’s coming from [at budget meetings] on January 16 and 17th,” Syed explained.

When looking at the town’s $40.18 million operating budget and $37.8 million capital budget for 2023, which has 44.3 million in carry-forward projects from 2022, Syed said, “there are no frills.”

The vast majority of spending is on essential services, such as water, wastewater, fire, police, public works, parks, and maintenance of facilities. 

“Our core focus remains to serve our citizens and businesses by effectively managing financial and physical resources,” Syed said. “Budget 2023, therefore, seeks to balance the objective of limiting the tax levy impact while maintaining desirable service levels and capital infrastructure commitments.”

As of Dec. 31, 2021, the Orangeville Railway Development Corporation (ORDC) owes the town close to $9.2 million and the 2023 budget incorporates roughly $3.2 million of that loan repayment to help offset the proposed tax levy increase.

Deputy Mayor Todd Taylor said using money from the ORDC to offset tax levy increases isn’t something councillors discussed on the campaign trail for the municipal election. Instead, they discussed holding the money from the sale of Orangeville’s railway in a savings account until the town’s taxpayers are consulted on how they think the money should be used.

“We were going to have the people of our town talk to us about how we would spend that money. So if the people of the town wanted it to go to offset budget costs, we can do that,” said Deputy Mayor Taylor. “But that’s not what we discussed, to have it spent here, so it just concerns me that we would have it in this budget prior to having consultations with the people.”

Syed later noted that the loan repayment by the ORDC is separate from the $32 million sale of railway assets and lands earlier this year. 

“For the last eight years, to keep ORDC afloat for its operational expenses, the town has advanced money, and the accumulation of that loan is 9.2 million,” Syed explained.

She said spreading the $9.2 million across the next five years will help mitigate the sharp rise in inflationary costs that the municipality is currently facing.

Orangeville’s CAO Ray Osmond said there will be a consultation in the community on how the railway money will be spent in the future. He also noted that the sale of railway assets and ORDC loans should be decoupled, as the loan was provided by the town interest-free over the years and the town is now recouping a portion per year instead of taking a lump sum.

Coun. Debbie Sherwood asked Syed what the tax levy increase would be without the $3.2 million from the ORDC loan to offset it and was told the 3.1 per cent increase represents a $1.1 million shortfall in funding. This means the tax levy would need to be increased to approximately 12 per cent if the ORDC money isn’t factored in.

When the budget is brought forward again on Jan. 16 and 17, council will have the opportunity to debate if the ORDC loan money should be used to offset the size of the tax increase.

Council’s final budget meeting is slated for Jan. 31.

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