It’s a wrap!  The 2018 municipal budget has been given the final stamp of approval by City Council, so let’s take a look at the final numbers and what they mean.

• Total Tax Levy: $189,741,400
  This number represents the amount of money collected in taxes to pay for city operations
• Total Tax Levy Increase: 3.13% or $5,754,600
  This number represents the increase in tax revenues over last year
• Net Tax Levy Increase: 2.42%
  This number represents the net increase in taxes to existing tax payers once new assessments and transfers from reserves are accounted for

In addition to property tax impacts, the approved budget includes an increase to business license fees as well as fee increases for various planning applications.  I am disappointed to see these fee increases for business as I recognize that many businesses are currently dealing with significant labour cost increases as a result of Employment Standards Act revisions that took effect on January 1st.

Projections by City Administration are forecasting a 5.03% levy increase in 2019 and a 4.75% levy increase in 2020. With a municipal election around the corner, NOW is the time for a fulsome discussion on where increasingly scarce financial resources should be allocated to achieve our community’s strategic objectives, to improve our competitiveness, and to foster economic growth.

Our members may recall that in January 2014 at the start of this term of Council, the Chamber released a report about Thunder Bay’s municipal finances that presented an analysis of city spending over the previous 12 years and projected where we would be if spending growth continued at the same rate.  At that time, we projected that the 2017 tax levy would reach $178 million and we expressed serious concerns about how that would impact property tax rates for businesses and residents alike.  Those projections fell about $4 million short of the reality: over $182 million was collected in taxes last year.  Thankfully assessment growth through new building construction has helped to absorb some of the tax increases, and government programs have supported efforts to address the infrastructure deficit, but our concerns remain.

As shown in the below table from the 2017 BMA municipal study, Thunder Bay’s taxes are higher than the Ontario average across 10 of 12 categories.

Under the direction of Council, City Administration has worked to find efficiencies internally without reducing services, which has resulted in an operating cost reduction of $12.4 million since 2012.  We applaud these efforts and the benefits that they accrue to our community.  With a budget of $345 million, of which nearly $190 million is paid through taxes, those savings amount to mere pennies on every dollar spent to run the City.  Projections by City Administration are forecasting a 5.03% levy increase in 2019 and a 4.75% levy increase in 2020 (based on information as of Jan 9/18 and subject to change). With a municipal election around the corner, NOW is the time for a fulsome discussion on where increasingly scarce financial resources should be allocated to achieve our community’s strategic objectives, to improve our competitiveness, and to foster economic growth.

As part of our advocacy efforts in the lead-up to the October election, we will be asking potential candidates where they stand on the City’s finances, and whether they support the need for an external services review.  We look forward to a discussion about ideas and opportunities that will help us build a competitive environment where businesses can grow and prosper.