LAURIE WEIR

Smiths Falls council was unwilling to accept a seven per cent tax increase, even after efforts to bring it down from an initial 9.6 per cent.

Treasurer and director of corporate services Paul Dowber presented the second draft of the 2025 budget to council on Jan. 27 during a regular committee of the whole meeting. He outlined efforts to reduce costs, including:

• A $1-million decrease in 2025 capital work. 
• An additional $495,000 in grant revenue from Natural Resources Canada’s Green Construction through Wood program for Confederation Bridge. 
• A higher projected 2025 capital reserve balance.

These changes would reduce the average property tax hike from $298 to $217 per household (based on a $160,000 assessment). On top of that, proposed utility rate hikes—5.5 per cent for water and 3.5 per cent for wastewater—would result in an additional $63 per year for the average residential utility customer. Councillors approved the water/wastewater increases.

A public survey on the budget process found significant concerns about the police budget, which is currently set for a 21 per cent increase but has yet to be approved.

Debating the increase

Coun. Peter McKenna said there was “tremendous concern” from well over half of respondents about the municipal police budget. He also noted that inflation costs are “much higher” than the cost-of-living adjustment (COLA).

Coun. Dawn Quinn acknowledged residents are struggling. “They’re having a hard time paying their bills,” she said. “I think seven per cent is too high.” She said she would be more comfortable with a five per cent increase.

Coun. Steve Robinson agreed the increase should be minimized but cautioned against service cuts. “The lower we bring it, how is that going to affect what we are able to provide?” he asked. “If we’re going to have to start cutting services, I’m sure there is going to be a huge backlash.”

Coun. Jay Brennan said this is the toughest budget he has seen. “The average increase at seven per cent is $217—but that’s based on an outdated 2016 assessment of $160,000,” he said. He suggested comparing with neighbouring municipalities. “They’re facing the same dilemma we are,” he said. “To go too low and affect service is a problem as well. I’d like to see it below seven, but I don’t want it to affect the services that our residents expect and deserve.”

Coun. Chris McGuire said he would like staff to find further reductions. “I’m not afraid of a service cut if it’s a service that’s not providing value,” he said. He pointed to economic development and tourism spending as an area to review. “Where I think of the services that we downloaded to the chamber of commerce, that $45,000 was replaced into that budget—now we’re spending $90,000 where we used to spend $45,000. I still see areas where we can be a bit leaner.”

Coun. Jennifer Miller said there is no “magic wand solution” and that she is comfortable with the seven per cent increase. She was not comfortable sending it back to staff without a plan for reductions.

Exploring other revenue sources

Chief administrative officer Malcolm Morris suggested the town look at new revenue streams instead of cutting services. One option would be user fees for services such as garbage pickup. “That won’t be without controversy,” he said, but noted it was a common suggestion in the survey. “I would predict that sometime in 2025 we need to have that discussion.”

“It will be an uncomfortable conversation,” he said, “but it will pay dividends in the long run. I don’t think we need to cut services, but we need to deliver them differently, and that takes courage.”

Dowber said the town’s operating budget is about $30 million. To bring the tax hike down to five per cent, Mayor Shawn Pankow suggested staff find an additional $400,000 in savings.

McKenna addressed what he called the “white elephant in the room”—the police budget. He had raised the issue at the Rural Ontario Municipal Association (ROMA) conference but said the province has no plans to provide funding for municipal police services.

“I’m a fan of our police chief and all the staff and the work they do,” McKenna said. “I can’t ignore that it’s a big part of our budget.”

During this discussion, Coun. Robinson excused himself due to a family connection—his daughter-in-law is the police chief.

McKenna suggested a third-party conciliation process to assess the police budget or, if necessary, outright rejecting it. “If we feel it’s too much, we have options,” he said. “With Smiths Falls’ per capita policing cost at $600—well above the $380 municipal average and even Thunder Bay’s $580—we need to take a closer look.”

Morris suggested using a rate stabilization reserve to offset the $400,000 shortfall, if council is open to the idea.

Staff will return to the Feb. 10 meeting with further options for reducing the budget increase.