Merrickville-Wolford council passed the 2019 budget last Monday night with a zero per cent tax increase. After the public meetings of the previous week, and the news of the Municipal Modernization Grant [MMG]of $371,000 from the Ontario Government, staff presented two budget scenarios to council for consideration.
The first was to stick with their original plan of a 1% tax increase, which would aid in the replenishment of their infrastructure reserve fund, which is now sitting at $10,000 after the significant investment made in the Drummond/Lewis Street rehabilitation project being undertaken this year. This increase would contribute roughly $30,000 into the reserve fund. Staff also told council that they had identified $59,000 worth of budget items that could be covered by the MMG from the province. If council chose to apply these funds to the budget, they would be able to put an additional $59,000 into the infrastructure reserve fund, bringing it to $99,000. This would also leave $312,000 from the MMG in reserve for future initiatives.
The second option was to approve a zero per cent tax increase, while still applying the $59,000 from the MMG to the budget. This would allow them to put that money into the infrastructure reserve fund leaving it sitting at $69,000. They would also still have $312,000 left from the municipal modernization grant to be used at a later date.
These options caused a lot of discussion around the council table, which ended in a recorded vote. Councillor Don Halpenny and Councillor Timothy Molloy both felt that it would be prudent to stick with their original plan of a 1% tax increase to build up reserves and plan for the future. Councillor Molloy said he is concerned about the future of the Ontario Municipal Partnership Fund (OMPF) under the current government, which contributes significantly to Merrickville-Wolford’s budget every year. “It is just as likely that the government will cut these funds, in which case we will have failed to collect money this year that we will need in the future,” he said at the meeting. “If something happens next year, we will have to increase taxes two-fold or three-fold to make up for this year.”
Councillor Bob Foster, Deputy Mayor Michael Cameron, and Mayor Doug Struthers felt that using some of the money to keep the tax rate the same was the fairest way to share the grant with the tax-payers. “For anything else we do with it, we will be spending it in one district or another,” said Councillor Foster. “At least this way everyone is benefiting from it.”
Mayor Struthers also said at the meeting that, while the province says the OMPF is under review, he has talked with Minister of Municipal Affairs and Housing, Steve Clark, and he says that they understand the importance of supporting their small and rural municipalities. “We can be assured that the OMPF will not disappear,” he said.
After the discussion, it was Councillor Molloy who asked for a recorded vote, which ended in a 3-2 result in favour of having a zero per cent tax increase. Fifty-nine thousand dollars will be applied to the budget, with the leftover $312,000 being put into a newly created Municipal Modernization Reserve Fund to be used for future projects and/or initiatives. Residents will still see a small increase to their tax bills, because of the rise in their MPAC assessments and taking into consideration the County and education levies.