At the City of Kawartha Lakes Council meeting yesterday (April 18), council approved a request to increase 2017 property taxes by over $1.1 million to help fund a deficit in the City’s 2016 budget.
The increase means property owners will pay an additional $5 more in 2017 per assessed value of $100,000. The increase applies to residential, farm, commercial and industrial properties.
The 2017 tax increase will only fund half of the 2016 deficit; the other half of the deficit will be funded by a tax increase in 2018.
Although the City of Kawartha Lakes has seen small surpluses within one percent of its annual budget in each of the previous five years, in 2016 the City experienced a deficit, mainly caused by winter weather conditions that meant extra snow clearing, sanding, salting, and snow removal.
While the City had budgeted for 40 winter weather events in 2016, there were 52 such events — resulting in unforeseen costs of $1.3 million.
In the past, the City has used contingency reserves to fund unforeseen deficits, but reserves are insufficient to cover the 2016 deficit. As a result, City staff recommended that council increase the increase the 2017 tax levy to cover the deficit.
“The current budget base must be right-sized to cover the cost of the existing service levels,” said Mary-Anne Dempster, Director of Corporate Services. “We need to either increase tax support or lower service levels.
To avoid future weather-related deficits, the City will budget for 50 winter weather events in the future and City staff will investigate options for providing services in a more cost effective manner.
