Quinte West City Council received an outlook on the 2025 budget as well as the long-term capital plan at its special council meeting on Wednesday.
In preparation for the draft budget to be presented on December 4 and 5, Director of Finance and City Treasurer of the City of Quinte West Caleb DenOuden presented a budget outlook on some of the issues council will have to navigate as it prepares for budget deliberations.
BUDGET OUTLOOK
DenOuden outlined that there are a number of factors that the municipality has control over including capital revenue, funding level for external partnerships/community groups, strategic intiatives and growth projects/investments.
There are, however, a number of factors that the municipality has no control over such as the rate of inflation, reliance on other organizations, and various standards that the municipality must meet.
A concern outlined in DenOuden’s report is that non-residential construction inflation continues to increase higher than the Canadian Price Index. Quinte West would experience those impacts, meaning that increases it has seen over the last couple of years will continue into 2025.
Council is also being expected to see 2025 budget items require additional money from what was budgeted in 2024 due to higher cost estimates.
As the city continues to grow, the 2025 budget will account for an increase in staff to maintain service levels as well as staff moving through pay band based on years of employment and some who have had a pay band increase. This would result in an increase to salaries and benefits of approximately $875,000.
Pre-approved staffing change, as well as the approval of various new positions, will be approximately $490,000.
Based on recent census data, the city is growing at a rate of 600 new residents per year. Currently, the city employs approximately 6.6 employees per 1,000 residents. Based on this math, the city would need to add an additional four staff positions to maintain its existing level of service.
When dealing with external agencies and partnerships, DenOuden says that preliminary budgets have indicated that most partners will have a draft budget that exceeds 2024 requests and surpass current inflation indices.
OPP have provided a budget to the City of Quinte West that is around 19% higher than the 2024 budget, equating to a 2% levy increase alone. Lower Trent Conservation Authority has presented a draft budget that shows a 16% increase to Quinte West.
Listed are groups that have or may have grant requests to be added as one time, or as annual, amounts to the city’s 2025 budget.
- YMCA of Central East Ontario
- Quinte Museum of Natural History
- River Valley Community Centre
- National Air Force Museum
The city is anticipating a $1 million loss in Payment in Lieu of Taxes (PILTs) on the federal government’s 8 Wing/CFB Trenton property as well as facing significant pressure from a lack of grant allocations from either level of government.
Results gathered from its public engagement survey found that a majority of the 224 responses (61.6%) rated city services as either “good” or “fair” with top priorities for increased spending in Capital Infrastructure, Public Works, and Fire and Emergency Services. Capital Infrastructure was ranked as the highest.
When residents were asked about tax rates and services, 33.5% of respondents supported maintaining services with inflation-adjusted tax increases, while 15.6% were in favour of increasing taxes to enhance services.
And 53.6% of respondents supported increasing user fees to reduce the property tax burden for recreation services. There was also support for eliminating garbage bag tag fees (55.4%), even if it meant a tax increase, though respondents were less supportive of eliminating dog tag fees under the same conditions.
LONG-TERM CAPITAL PLAN
City staff put together a long-term capital plan for the next 10 years. It estimates an annual spend of $36.5 million based on the following criteria:
- 2% capital levy each year for 10 years
- Limit overall debt payments not funded by development charges (DCs)
- No enhancements to current levels of provincial/federal funding
- 3% inflationary factor on capital costs per year going forward
- New 2024 development charges will fund portion of growth projects
$26.5 million is required as a baseline for rehabilitation of current assets and $10 million is required for growth projects mainly funded by DCs.
The total spend is a 63% increase in average spend compared to the past four years. The report notes that this spend is “realistic, but minimal, investment into the city’s assets.”
Roads are still underspent compared to Asset Management Plan needs, according to the report.
The report outlines some of the drivers for the infrastructure deficit including rehabilitation projects being deferred, inflation, preference for new growth-related (non-rehabilitation) capital projects and unexpected and high value asset failures.
The following numbers were provided when it comes to allocation of the Ontario Community Infrastructure Fund to Quinte West:
2015 – $1,225,301
2016 – $1,225,301 (0% increase)
2017 – $2,001,132 (63% increase)
2018 – $2,821,973 (41% increase)
2019 – $4,222,774 (50% increase)
2020 – $4,157,747 (2% decrease)
2021 – $4,157,747 (0% increase)
2022 – $7,531,017 (81% increase)
2023 – $6,451,075 (14% decrease)
2024 – $5,743,494 (11% decrease)
2025 -$6,605,018 (15% increase)
Council approved receiving the presentation, as well as the associated reports, when it came to the 2025 budget outlook and the long-term capital plan.
The draft budget will be presented to council on December 4 and 5.
A link to the outlook and plan can be found at the City of Quinte West’s website.
