If you liked Norfolk’s 2020 water budget, you’re going to love the county’s 2020 operating budget.
Norfolk County has disclosed that the draft operating budget for this year would increase residential property taxes 14.5 per cent if approved unchanged.
The draft document contains a number of staff recommendations which – if approved – would reduce that increase to 12.2 per cent.
Whatever happens at the end of the month, the county warns this year’s operating budget “will almost certainly include a double-digit budget increase before council can return to more palatable inflationary increases.”
Mayor Kristal Chopp said 2020 marks the start of “a multi-year plan to fix the county’s financial issues” through a process described as “painful.”
“Taxes have been kept artificially low while services have continued to increase for too many years,” Chopp said in the news release on Jan. 17.
“Not only is that unacceptable, it’s completely unsustainable – for those on fixed incomes, for those precariously employed, for everyone. This council needs to make the tough decisions on service reductions now in order to get the county back on track toward more acceptable annual budget increases.”
Chopp pointed out that the county’s debt, at present, is around $54 million. This will rise to more than $157 million by 2022, mostly on the strength of expensive, unavoidable water and sewer projects and other infrastructure-related matters.
The news release blames the big increase to come on “past actions over which this council has little control.” Items cited include “previous budget commitments, skyrocketing debt payments, and years of unrealistic revenue and spending estimates – all in addition to annual cost increases.”
Norfolk’s situation is complicated, the release says, by the fact that previous councils have papered over the mounting financial strain by drawing down reserve accounts. The release says Norfolk’s annual operating deficit from 2015 to 2018 rose from $3 million to $19.8 million. Tax revenue, meanwhile, increased on average by $3.3 million a year while expenses increased $4.6 million a year.
Charlotteville Coun. Chris Van Paassen, chair of the county’s budget committee, said council will have to be resourceful if it hopes to keep taxes in line with what residents can afford.
“We’ll need to consider anything and everything if we’re going to right this ship,” he said in the release.
In a “Fast facts” section on the 2020 budget, the county says, “Only those proposals critical to county operations or necessary for creating efficiencies will be considered as `New business initiatives’ at the budget meetings.
“These include investments needed to keep up with demand for paramedic services and resources for the digitization and modernization of county services.”
The release adds “It will take more than one budget to return the county to a solid financial footing.” Alternatives under consideration for this year’s deliberations – scheduled for Governor Simcoe Square Jan. 28 and 29 – include different ways of delivering services, the sale of surplus land and buildings, service reductions, and staff reductions.”
In the same release, Chopp made a point of defending council’s decision to buy land in preparation for construction of a new recreation complex in Simcoe. The facility could cost as much as $50 million.
Chopp issued a reminder that council’s approval of the project is contingent on receiving substantial federal-provincial funding.
She also issued a reminder that there is a strong business case for the project given the costs Norfolk will incur in the years ahead maintaining and repairing aging recreation infrastructure at assorted locations in Simcoe.
Indications that Norfolk property owners would be asked to dig deep in 2020 emerged in the fall when council members warned of difficult budget decisions ahead. The first shoe dropped in November when council increased water and sewer rates by an unprecedented 16.8 per cent.
“I’m as frustrated as anyone about the situation we’ve inherited,” Chopp said. “But it’s this council’s job to clean up this mess.
“We promised transparency and action on the issues facing Norfolk and we intend to deliver on that promise – even if the decisions we make are unpopular with some.”