By Joel Wittnebel/The Oshawa Express
The average home owner in Oshawa could expect to see an additional $65.48 on their tax bill this year.
That number is a result of the city needing to come up with an additional $3.6 million over the 2015 budget, possibly resulting in a 2.94 per cent tax increase.
The increase equates to approximately $20 more on a tax bill for every $100,000 of assessed value.
The majority of additional costs come in the form of salary and benefit increases of more than $3 million.
As well, the savings gained from gapping certain positions within the city in 2015, a practice that temporarily saved the city more than $1.2 million, are now lost as those positions are filled, resulting in a decrease of more than $855,000.
Councillor Amy McQuaid-England says this practice can be a little short-sighted when it comes to budgeting.
“I think the concern is that we need to start being proactive in terms of our budgeting instead of reactive,” she says. “I think that if you look through the budget, there is a lot of gapping and a lot of things in which we had short-term savings for previous year budgets where now they’re coming in in terms of millions of dollars that we now have to pay out.”
As well, an additional $548,000 is needed to cover inflation pressures, nearly $118,000 for increased maintenance costs and $162,600 for debt servicing are also responsible for budget increases in 2016.
Overall, the city’s proposed operating budget sits at more than $134 million.
For Mayor John Henry, the city is facing additional pressure and costs from the country’s declining dollar.
“We’re caught in this budget the same way everyone else is that lives in Durham and ultimately the entire country. The difference in the dollar is hurting us, as some of our stuff does come from outside the country,” he says.
As well, the cost of electricity is becoming a burden on the city’s budget, in particular Hydro One’s global adjustment charge, something Henry was quick to point at during the budget meeting.
The charge, which was initiated by Hydro One in 2005, can be a credit or a fee charged to customers to make up the difference between the spot price for power and the rate at which it is paid out to various providers across the province.
Last year, it cost the city nearly $2 million.
As discussions continue this week, external agencies are slated to present their budgets to the finance committee on Jan. 21, Mayor Henry hopes to reduce the 2.94 per cent increase.
“I’m sure we’ll be less than the amount that was out…but I don’t know how far we’re going to be able to go,” he says.
McQuaid-England said much of the same, noting that council needs to be realistic with taxpayers that if the increase doesn’t occur, it could result in a cut to services.
“I think that we need to have honest discussions about what we’re going to offer our residents for the amount of money that they have to pay,” she says. “If we’re going to go below that (2.94 per cent), I believe that we have to have a discussion about cutting services.”
Last year, Oshawa’s proposed budget first saw an increase of 2.11 per cent, which council was able to pull down to 1.82 per cent.
Following the Jan. 21 finance committee meeting, the first round of budget deliberations are set for Jan. 25 at 9:30 a.m.