Like Robin Hood in reverse
Does anyone remember the term “revenue neutral”, or the “tool kit”
that was supposed to allow municipalities to balance their books
A decade later, it is apparent the vaunted “tool kit” has a few
screws loose, or missing altogether, and the “revenue neutral”
exchange of services is anything but.
Municipalities have seen their expenses skyrocket as the province
continues to mandate services which municipalities are legally
obliged to provide.
At the same time, municipalities have had to deal with the same
issues that affect any other enterprise - rising costs for
electricity and fuel, plus wage increases, to name only a few.
Some municipalities went into restructuring and amalgamations
kicking and screaming. Others accepted the statement by the Harris
government that “the status quo was not an option” and moved ahead
as best they could.
Many of the amalgamated municipalities succeeded, at least
initially, in maintaining services while keeping tax increases
minimal by tapping into reserves and postponing major infrastructure
projects. Fees were established for services once provided free, and
those fees are increasing at an alarming rate.
Amalgamations meant surplus municipal buildings, many of which have
been sold off, helping to alleviate the financial crunch at least
for a time.
Shifting the burden from income onto property taxes is
like Robin Hood in reverse. Property taxes just go up,
with the burden falling heaviest on retired people with
fixed incomes, farmers whose earnings have been
negligible over the past couple of years, and small
businesses that are struggling to remain in operation.
There were some initial expectations that the overall number of
staff could be reduced, but the new municipalities discovered
“economies of scale” does not run to human resources. A larger, more
complex political unit takes more, and in some cases better
qualified and more highly paid personnel - both employed and
These days that catch phrase “economies of scale” has been replaced
by “bigger is not necessarily better”.
Small, rural municipalities may have been melded together, but the
fact is, they are still not bulk-buying graders and snow plows.
At this point the dust has settled on amalgamation. Municipalities
are starting to understand just how much was downloaded and are
struggling to keep taxes in line while providing necessary services.
Those services are starting to include the roads and bridges that
will soon have to be closed if they are not repaired or replaced.
Downloading onto the municipalities may have got the province out of
a tight spot but is proving to be a remarkably short-sighted
solution that is hurting small business and discouraging
While federal and provincial taxes are based on income, municipal
taxes are property-based. In theory at least, the bite of paying
more income tax is eased by the higher income.
Shifting the burden from income onto property taxes is like Robin
Hood in reverse. Property taxes just go up, with the burden falling
heaviest on retired people with fixed incomes, farmers whose
earnings have been negligible over the past couple of years, and
small businesses that are struggling to remain in operation. And
increasing fees for services like planning effectively strangles
development - no increased assessment to spread out the tax burden.
Our cities are saying they can no longer handle provincial
downloading and that they need a huge injection of cash to keep
their infrastructure viable. The same is true of rural
municipalities, if not more so.
The federal government is saying it has no cash to give the
The province is saying it has no cash to give the counties.
Huron County is looking at an 18 per cent increase, of which 14 per
cent is in mandated services.
All that we, the taxpayers, know is that we pay a lot of income tax
and our property taxes are entering the stratosphere.
Canadians just spent $130 million - that we know of - to find two
people not guilty of the Air India bombing. No one knows how much
the Gomery Inquiry will end up costing in addition to the original
sponsorship mess. Then there is the $2 billion fiasco called the gun
The thought comes to mind that $2 billion would fix a lot of bridges
and roads, with a hefty chunk left over for training new doctors.
The thought also comes to mind that taxpayers are also voters.
The Wingham Advance-Times