Municipal tax increases: How does North Dundas compare?

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A reader has asked some important questions about the draft municipal budget after reading the Council update in the last issue of the Times.

“A tax increase of 14%+ seems a bit extreme,” the reader says. “Personally, this will result in about a $500 increase annually, at a time when everything else is also increasing. Will residents get any say in this before it is approved? How does this percentage compare to increases in other rural municipalities in Eastern Ontario? Are new costs of water and sewer upgrades getting passed along onto residents with private wells and septic systems? What steps have been taken to find efficiencies in advance of raising taxes?”

The reader is referring to the draft municipal budget which was presented at the February 1 Council meeting. It proposes a property tax increase of 14.7% for 2024. These are some tough questions, and they are certainly worth answering.

The Township does not hold formal consultation sessions for draft municipal budgets, but that doesn’t mean that members of the public can’t have their say. “All residents are encouraged to review what has already been presented to Council, and share any comment, concern, or question ahead of the budget being back before Council February 29,” said Councillor Matthew Uhrig. He explained that budget decisions may get wrapped up during the February 29 meeting, or otherwise “get awfully close” that day.

To answer the question of how North Dundas’ proposed tax increase compares to other municipalities, we’ll compare it with four area municipalities whose 2024 budgets were already passed, or whose draft budgets were available online (some municipalities don’t post their budgets online until they are passed).

To the west, in North Grenville, the proposed tax increase for this year is a relatively small 3.5%. Although only 45% larger than North Dundas, North Grenville is one of the fastest growing municipalities in the Province, so with an ever-increasing number of taxpayers, the local government there is able to keep tax increases to a minimum. The City of Ottawa comes in with an even lower increase of just 2.5% in its already approved 2024 budget. Similar to North Grenville, but with a population of 1 million people, the resources in Ottawa make it easier to keep tax increases to a small amount.

The draft budget for the City of Cornwall proposes a 4.07% increase, which is “average” when considering tax increases across multiple area municipalities in the last several years. North Grenville’s Council was considering a 0% increase in 2022, and settled on a 0.74% increase upon further consideration. North Dundas’ increase for last year was 5.41%, which is closer to a “typical” increase.

In South Stormont, the property tax increase for this year was 13%, which was a figure high enough to make Standard Freeholder headlines. The proposed increase of 14.7% here in North Dundas is therefore undeniably high, but why?

North Dundas is facing some unique challenges. Growth is not as high here as it is in many other municipalities, and being a relatively small Township to begin with means that cost increases (i.e. those being felt by everyone right now) hit especially hard. Council has been very generous toward Township staff in the last couple of years in an effort to attract and retain good employees. Staff compensation and benefits have increased (in line with the trend of minimum wage hikes), and that money has to come from somewhere. The last two years of having limited public pool hours in the summertime shows very clearly what happens when positions don’t pay fairly for the work, experience and training required – positions end up vacant, and taxpayers are shafted for services that their tax dollars are supposed to pay for.

The Township has also faced difficulties beginning last year with the costs of insurance, as well as increasing pressure from residents to make much needed repairs to roads, and to add recreational amenities. The Township is also bound to be feeling some of the same financial pressures that are hurting all Canadian households, such as high gas prices and the largely unprecedented inflation of the costs of most goods and services. Finding efficiencies can be easier said than done in a municipality where costs are rising, but the number of taxpayers remains largely the same.

To answer the last question of the concerned reader, Councillor Uhrig was able to confirm that water and sewer services in North Dundas are paid for by user fees. Those on private well and septic systems do not contribute to the upgrade costs for the public systems in Winchester and Chesterville.

The next budget meeting will take place on February 29, with a budget ratification motion set to be before Council some time in March.

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