Hamilton City Hall is hopeful the provincial and federal governments will continue providing record levels of financial support to municipalities for transit, public health, and COVID costs to address budgetary pressures resulting from the pandemic.
Based upon this presumption, City staff state the starting figure for the 2021 municipal budget process is a 4.0 percent tax increase – an increase of $146 for a home with average assessed value exclusive of area rated services.
City Hall did not release detailed projections of scenarios that could exist if the other levels of government do not renew their financial support packages when they expire.
The 4.0 percent increase is presumed upon a 1 percent growth in tax assessment, and no reassessment appeals impact.
It is not yet known if commercial real estate values will decrease in the coming year due to COVID’s impact upon offices and retail, approximately 10 percent of Hamilton’s property tax revenue is from commercial properties. [Today saw retailer Le Château enter into bankruptcy and announce closure of all its retail outlets]
City staff propose cancelling the implementation of this year’s 0.5 percent capital budget tax increase, an annual increase designed to lessen the growth of Hamilton’s $2-billion plus infrastructure deficit.
Staff suggest using the remaining $4.3-million of 2019 Federal Gas Tax funds to “offset” the reduction of revenue from not implementing the 0.5% increase. As the annual 0.5 percent increase is based upon the previous year’s rate, the cancellation of this year’s increase will compound in future years.
The rate budget – what people pay for water and wastewater – increase is forecast to be 4.28 percent.
[Due to work from home, the average water bill for residential users has changed, and thus projections are not available of what this increase may represent in dollars per month]
“While industrial and commercial water consumption declined over the past year as a result of lockdown restrictions in response to the COVID-19 pandemic, the increase in residential consumption has offset the negative impact on revenues”, the staff report states.
COVID Deficit Projection
The City says it is “projecting additional financing pressures related to COVID-19 in 2021 between $34.8 M and $59.2 M”, the City says pressures are primarily related to public health, housing and homelessness, and lost transit revenue. The budget projections do not reveal if the City plans to increase transit service or continue to operate reduced service levels in 2021. The transit budget will be revealed on January 22, 2021.
The Hamilton Police Services budget is expected to increase $4,782,820 due to inflationary costs and salary/benefit costs. The projected 2021 police budget is $175,597,980.
Public Delegation Day
Council will hear from the public near the end of the budget process on February 8, 2021.
This will be the only date Council will allow public delegations to Council on the budget. The public and interested parties can submit written correspondence to Council at any point during the process.
The first budget process meeting is Thursday, October 29 at 9:30am during which City Hall senior management will provide their overview presentation of projections, forecasts, and the timeline for the budget process this year.
Production Details v. 1.0.0 First published: October 23, 2020 Last edited: October 23, 2020 Author: Joey Coleman Edit Record v. 1.0.0 original version