Portion of city surplus lowers tax bills

BARRIE - Thanks to a 2009 budget surplus Barrie taxpayers will see a slight reduction in their taxes this year.

Councillors weighed the need of boosting underfunded capital reserves with the desire to reimburse taxpayers. In the end they decided split the money and use $1 million from the $6.9 million surplus to lower the 2010 tax rate.

The rest of the surplus will see $2 million go to the tax rate stabilization reserve and the remaining $3.6 million to the tax capital reserve account.

The new allocation will reduce the average homeowner’s tax bill by approximately $20 this year, said Ward 10 Coun. Alex Nuttall.

In February, council levied a 2.3 per cent tax hike, which translated into a $74 increase for properties assessed at $250,000.

Also approved Monday was an expenditure of $227,172 to fund unresolved 2009 commitments.

“This does strike a balance – a responsible balance,” Ward 7 Coun. John Brassard told the Advance.

“Some may like a zero per cent tax increase, but at what cost to our long-term financial obligations? I think people expect responsibility.”

During the discussion, Ward 2 Coun. Jeff Lehman said most of the money had been promised elsewhere and should be held until needed to avoid future problems.

The real surplus, he said, consists of  $775,000 left in the snow-removal budget after the mild 2009 winter season, a one-time $600,000 dividend from Barrie Hydro Holdings Inc., and $817,000 from new taxable properties added to the rolls mid-year.

“It is quite wrong to see (the rest) as savings,” he said. “Our kids will just pay it down the line.”

Supporting the reserve-fund allocation, Mayor Dave Aspden reminded his colleagues of a recent study recommending $80 million be put aside annually to support future maintenance and replacement needs of the city’s $2.8-billion infrastructure. In the 2010 budget, $5.8 million was set aside for future infrastructure needs.

While council felt a higher allocation would result in an unacceptable tax hike or severely reduced services, Brassard said the 2009 surplus provides an unforeseen investment opportunity.

“If you don’t have the reserves, you have to debenture or raise taxes,” Aspden said. He strongly opposed wiping out a tax increase altogether. “This protects the taxpayers.”

The split focus of the approved motion got Ward 8 Coun. Jerry Moore’s vote.

“I think we should give some back and save some for a rainy day,” he said. “It’s the right thing to do.”

Ward 1 Coun. Mike Ramsay, who criticized early budgets for repeated surpluses, wanted to help the current cash flow of residents still recovering from the recent economic woes.

“I can’t think of a rainier day than what people have been facing,” he told his colleagues.