Treasurer reports some financial loss due to COVID-19


Village Treasurer, Kirsten Rahm, presented a report to council at their last meeting, bringing them up to date on the Municipality’s 2020 finances. As with many municipalities across the province, COVID-19 has had an impact on the Village’s financial situation.

With council’s decision to lower the tax rate, charge the residential water rate for all commercial buildings, the waiving of interest on utility bills until July 31, lost revenue from the Blockhouse and the rental of municipal facilities, and other COVID-19 related expenses (cleaning supplies, PPE, legal costs, IT services, signage, postage), the Municipality is looking at a loss of $128,598 so far in 2020.

Kirsten’s report also mentions that they are projecting further losses this year from continuing to waive penalties and interest on utility bills, cancelled municipal facility bookings, and lower commercial water and wastewater rates. “It is still too early to quantify all the financial impacts resulting from COVID-19,” Kirsten wrote in her report to council. “The third quarter report, to be presented in October, will provide a better indication of the Village’s fiscal sustainability during the pandemic.”

The report also showed that the Village has collected approximately 70% of the interim taxes that were due at the end of February. This means that 30% of Merrickville-Wolford residents have not paid their first tax bill of 2020. Kirsten says that, while the tax arrears are higher than their auditor would like, it is consistent with other years, so this doesn’t seem to be a result of COVID-19. “It’s a process that is ongoing,” she said at the meeting. “We do plan to bring that number up.”

Merrickville-Wolford council also discussed the possibility of waiving the interest on tax installments, due on July 31, for August and September. Kirsten outlined in her financial report that, should council decide to waive penalties and interest on all tax bills for the rest of the year, the estimated total loss to the Municipality would be $73,500. “We do make a lot of money on arrears,” Kirsten explained.

She also reported to council that, should they decide to waive interest on tax bills for August and September, this would apply to all taxes that are currently owed, including those owing from previous years. This would mean that interest would not be accrued over those two months for outstanding bills for 2020, 2019, 2018 and earlier. “Software systems unfortunately aren’t designed to do multiple interest calculations,” Kirsten said.

Councillor Timothy Molloy said that, while he was fine giving residents a break for 2020, due to COVID-19, he did not agree with waiving interest on late payments from previous years. Councillor Bob Foster asked whether they had heard from the public if the waiving of interest on tax bills was something they were looking for. “From general public, no,” Mayor Doug Struthers said.

Councillor Foster also noted that, even if they were to waive interest for August and September, they would still owe the County and Education portion of the bill. “We’re kind of caught between a rock and a hard place on that,” he said.

In the end, council decided against waiving of interest on tax bills. Regardless of the fact that tax arrears are relatively high, this is an historical issue, and it doesn’t seem that COVID-19 has affected resident’s ability to pay their tax bills on time yet. “We’re solving a problem we don’t actually have,” Councillor Molloy said.


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