King council now ponders 3.5 per cent tax hike
By Bill Rea

King Township's number crunchers have been busy finding ways to cut the budget for 2007.

They presented council with a proposed budget Monday night that would see a 2.65 per cent tax increase, but the prospect of having to pay off some heavy debentures in the coming years prompted the politicians to consider increasing reserves to cover those anticipated expenses.

The proposed debentures will be to cover the costs of concurrent road reconstruction with the installation of sewers in King City and Nobleton, and they will amount to about $3 million. Staff had suggested starting a reserve this year of $125,000 to help cover costs once the debenture payments start coming due next year, but Councillor Jack Rupke suggested more should go into that fund. He first proposed another $40,000.

Councillor Bill Cober liked that idea, and proposed taking it further. He said he personally doesn't like the idea of debenturing, but he's been checking what goes on in other municipalities and found it's a common way of dealing with the infrastructure deficit in Ontario.

"You've got to fix the roads," he declared, calling for an increase in the reserves to cover the coming costs. "If we don't do it this year, we just take a bigger hit next year."

Cober suggested increasing the reserve fund to $200,000.

Township Treasurer Don Young told Cober that would take the proposed tax increase up to about 3.4 per cent. Cober observed there were other extra expenditures that councillors seemed to favour, such as going along with the Township's heritage committee desire to increase its research budget, so he suggested setting a tax hike target of 3.5 per cent.

Councillors had mixed views on that at the end of Monday's session.

"I think it's more than I would have hoped for," commented Councillor Jeff Laidlaw.

Councillor Cleve Mortelliti had advocated going higher, observing the sooner the reserve is built up, the easier things will be down the road. "We're going to pay for it, no matter what," he observed.

Cober pointed out they had been looking at an increase on the order of six per cent last month, so this was an improvement. He said he would prefer no tax hike at all, but "a zero budget increase is not realistic."

"I don't think we have any choice," Councillor Jane Underhill remarked. She recalled earlier budget sessions, at which councillors were told if they didn't debenture the road work, they would be looking at a tax increase in the neighbourhood of 30 per cent. She added the public needs to understand what the alternatives are.

"I think we have to look after our responsibilities in regard to looking at future budgets," Rupke commented after the meeting. He pointed out development charges are expected, but it's going to be a couple of years before the municipality has the money, meaning the next couple of years are going to be difficult, in terms of budgets.

Mayor Margaret Black called 3.5 per cent "acceptable."

But she pointed to the provisions announced last week in the federal and provincial budgets and hoped there would be some financial relief for municipalities. The provincial budget announced pooling in the Greater Toronto Area is to be phased out, meaning York Region is going to save about $7 million this year. That might impact on the Regional taxes King residents pay, and could offset the 3.5 per cent hike.