By Dave Flaherty/The Oshawa Express
The finish line on the 2019 budget is still far from sight, but the first details are here.
After crunching the numbers, staff has submitted a 2.52 per cent tax levy increase for this year.
That increase represents an average tax bill increase of $55.22 on a property assessed at $356,000, the average Oshawa assessment by the Municipal Property Assessment Corporation.
To get to the proposed 2.52 per cent, commissioner of finance services Stephanie Sinnott said the city requires an additional $3.557 million in tax revenue.
However, the final tax increase, if any, may fluctuate as council is holding a number of upcoming deliberation meetings.
The first, scheduled for Thursday (Jan. 17), will see input from residents and community organizations.
Official deliberation meetings will follow on Tuesday, Jan. 22 and Friday, Jan. 25.
Final deliberation and approval are scheduled for Friday, Feb. 8 at 9:30 a.m.
In total, the proposed budget estimates $3.033 million more for the city in revenues this year versus $6.59 million in increased expenditures.
The proposed budget includes a total of $153,098,586 in expenditures against an estimated $149,541,300 in revenue.
This includes $27.284 million in proposed capital projects.
Vehicles and equipment represent the highest ask at $5.147 million, followed by development-related roads at $4.481 million.
The highest increasing expenditure is a suggestion of $1.919 million in reserve contributions.
Sinnott said the city is making “some headway” in boosting its reserves, which is consistent with a message delivered in a June 2018 audit by KPMG of Oshawa’s financial situation.
However, the commissioner did note the city is “definitely not in a position to fully fund our capital needs over 10 years.”
These reserve contributions include approximately $138,000 to a dedicated infrastructure levy.
Increases to salary and benefits also serve as an increased expense for the city, estimated to rise by $1.275 million in 2019.
Staff notes this figure doesn’t include salary and wage adjustments not yet negotiated and wage adjustments resulting from the three-year council-mandated compensation review.
This year’s budget also includes the first of 10 yearly payments of $420,000 to Durham Region as a result of the settlement of a decade-long dispute regarding unfunded transit liabilities.
The proposed budget also sees a $976,500 decrease in debt servicing charges and a $647,000 reduction in tax levy funding required for capital projects not funded by reserves.
Sinnott told council staff “looked at a wide variety of things, and proposed a budget they thought was most responsible going forward.”
Ward 5 regional councillor Brian Nicholson questioned why staff had not considered a zero per cent increase option.
He also requested staff to identify a list of projects that could be cut or deferred to get to a zero per cent increase.
“If council chooses to pick a number lower than [2.52 per cent], it’s important council knows what projects need to be cut,” Nicholson said.
Nicholson said he felt councillors had “been kept in the dark for the past two months on the budget process.”
“Council has absolutely nothing to do with this budget [as first presented],” he said.
Furthermore, Nicholson added he couldn’t agree with staff recommending $6 million more in expenditures against an expected $3 million increase in revenue.
“I’m having trouble understanding how we justify that from a staff perspective,” he said.
However, Ward 5 city councillor John Gray noted a significant part of the increased expenditures is out of staff and council’s hands, such as contractual wage increases and the transit settlement.
“Some of this is controllable and much of this isn’t controllable,” Gray said.
All portions of the budget are subject to final council approval.