2023 Budget Update 1

On Thursday, Dec. 15, members of Wasaga Beach town council began work on the 2023 draft operating and capital budgets.

The meeting began with Jocelyn Lee, the town’s treasurer, presenting a report on draft 1 of the budget. Council received the report for information.

Watch the presentation. See the 3:44 mark.

Over the last few weeks, staff reviewed departmental budgets and looked for savings opportunities or increased revenues. Departmental budgets are based on meeting current service levels, staffing pressures, addressing emerging trends and legislation, as well as proposed requests.

“This report outlines the budget pressures for 2023 and the efforts staff have made to address them,” Lee said.

One of the challenges facing all municipalities in Ontario is the freezing of assessment rates at 2020 base levels. The province held off implementing new rates due to the pandemic. Increased assessment levels would translate to additional budget support, which the town has historically relied on to keep down tax rate increases.

As things stand today, the total operating budget for draft 1 is $48-million, compared to $44-million in 2022. The operating budget covers the day-to-day expenses required to deliver services to residents. These costs return year after year and include items such as staff wages, office supplies, repairs and maintenance, insurance and utilities.

The capital budget for draft 1 is $65-million, compared to $57-million for 2022. The capital budget supports long-term investments such as infrastructure and facilities.

The proposed 2023 budget results in an overall blended tax rate of 6.0 per cent. For an average home assessed at $333,000, this translates to a $174 increase over 2022.

During the early stages of preparing the first draft of the budget, staff noted increased inflationary pressures were driving up costs. For example, insurance costs are estimated to increase by 20 per cent over 2022 actual costs.

Police costs increased taxation by $164,000 over 2022 levels, a 3.3 per cent increase to the policing budget.

The Ontario Municipal Partnership Fund decreased by 15 per cent, as it does each year. The province is phasing out the fund. The impact of this decreasing operational grant is to add $48,930 more to the tax supported operating costs and $146,770 less is contributed to the Capital Replacement Reserve to support the asset management gap.

In the 2022 budget, some of the debenture costs were supported by reserves to help offset some taxation impacts. For 2023, these costs related to the Main Street Bridge rehabilitation project are now reflected in taxation. This increased taxation by $493,000.

Also, construction financing costs for the twin-pad arena and library will be higher as the project moves into the final year of construction. See the staff report for details.

Staffing requirements for multiple departments are part of the initial draft 1 budget discussion. Some requirements are driven by new legislation, others related to increased service levels, and others related to maintaining existing service levels. The town has grown significantly in recent years, from 20,675 people in 2016 to 24,862 people in 2020 – a 20.3 per cent increase.

The new staffing requests total $963,420 in the 2023 budget. Of the new staffing costs, the tax supported amount is $877,510. When annualized, the new staffing requests represent about $1.9-million with a tax supported amount of $1.8-million. There are 14.14 full-time equivalent positions and 3.6 part-time.

In developing the capital budget, staff have used the tax levy, general reserves, development charges, construction financing, the Federal Gas Tax Reserve Funds for projects and other revenue sources.

The largest single capital project will be the continued construction of the twin-pad arena and library. But other major projects include road works, the West End Depot, water and wastewater projects, storm drainage works, and parks projects.

Draft 2 of the budget will focus on the following items for consideration:

• Update to benefit rates;
• Adjustments to capital projects;
• Other changes identified between Draft 1 and Draft 2.

The following are the key dates in the budget process:

Jan. 19 – Detailed presentations by department heads of Draft 1. Discussion and questions from council. Also, council to provide direction to staff for Draft 2.

Feb. 9 – Draft 2 budget presentation and review of changes. Council to provide direction for any changes required for Draft 3.

March 2 – Draft 3.

March 28 – 2023 operating and capital budgets public meeting. The 4-year operating and 10-year capital forecasts will be presented for information.

March 30 – Council consideration for final approval of the 2023 operating and capital budgets.