No tax increase in first draft of Smiths Falls budget but expect others

Posted on: November 27, 2017

Chris Must

Although the first draft of Smiths Falls’ 2018 municipal budget shows no increase in taxes, residents are unlikely to escape with no extra costs.

Staff are recommending a hike of as much as seven and eight per cent in rates for water and wastewater treatment and distribution. A second option called for an increase of only two and three per cent.

“It’s all the same pocket,” commented Councillor Chris Cummings, saying he would favour the lower increase. “It’s just how it’s distributed.”

The initial draft was presented at a Nov. 27 meeting of council’s Committee of the Whole. The council members in attendance agreed they would be unable to support the higher of the two recommended water rate increases.

Smiths Falls Chief Administrative Officer Malcolm Morris stated that the higher rate increase would be required for the town to cover both the costs of water and wastewater processing and distribution. The seven and eight per cent increase, he added, “would help us gain ground on the covering the tax-supported deficit.” The lower increase, said Morris, “is more status quo.”

Despite a recommendation for the town to borrow $900,000 to fund a number of capital projects, Cummings stated that he was expecting “a much more bleak outlook. I was pleasantly surprised.”

Morris responded that the suggested $900,000 would not be necessary if the town was not required to refund close to $1 million in taxes paid by RioCan Properties, the former owners of the County Fair Mall. RioCan successfully appealed the assessment of the value of the mall property as carried out by MPAC, the Municipal Property Assessment Corporation. That payment, council was told, depletes the town’s cash reserves.

The loan is intended to contribute to the cost of three municipal projects, including renovations to the public library, the town square project, and renovations to the town hall complex. Before making a decision on the loan, councillors asked for a more detailed breakdown of the costs.

“I’m cautious when it comes to borrowing,” said Mayor Shawn Pankow.

Cummings, council’s representative on the library board, said $250,000 was budgeted for the library renovations, which include work on the third floor and insulation for the building, which was not renovated at all until 2002, a century after it was built. “We think the renovations are absolutely not ‘nice to have,’ but ‘have to have,’” he said.

Staff also asked councillors to decide whether to leave the budget for community grants at $130,000, the same amount as budgeted in 2017. Informed that $56,000 is unspent from the current budget, Councillor John Maloney suggested that this be rolled into the $130,000 for 2018, rather than kept in reserve.

The town’s net operating expenses in 2017 were over $16 million.

Deliberations on the 2018 budget will continue in December, with a January target for final approval