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HomeMy WebLinkAboutCD-x-81 (Memo) ~r.3 -, y TOWN OF NEWCASTLE To: Chairman and Members of the Finance and Administration Committee The attached Press Release by the Minister of Intergovernmental Affairs, the Hon. Thomas L. Wells is submitted for the information of the Finance and Administration Committee. _--~' _ --__ 6--"_ J. M. McIlroy, A.M.C.T. Town Clerk February 2 1981 nQ~Rar~m? ~: Mr. J. P.Q. Mc~lroy, Town Clerk FR01lQ: Garnet Rickard, Mayor DATE: January 30th., 1981 SUBJECT: PROVINCIAL 1~iANSFER PAXMIIVTS TO MUNICIPALITIES FC)R 1981 Enclosed is a copy of the R~narks and the Press Release on the Provincial Transfer Payments to Municipalities for 1981 from the Ministry of Intergovernmental Affairs. The News Release is dated January 22nd, 1981 and the Renarks are dated on the same day. ~; , Garnet Rickard ~, ~ ~ , ~~ ~~ Mayor ~ f ~ - ~ ~ ~~.. ~ J ~. ~ ~- ~:,1 € _ R ~° ~~ - . ' 7 ~ ' ~ x .. ~t ,...o,liP' o„~a„~ RECEIVED JAN ~ ;; 1981 ~- +. Juice of the Ministry of a,sr sfs-3sos Oueen's Park k. niniste. Intergovernmental Toronto, Ontario t r Affairs MEPIORANDUM T0: 11E ADS Oc^ COL1iCIL K CLERKS AD:D TP.EASURERS s FROM: THE HONOURABLE THO^tAS L. WELLS MINISTER OF IVTERGOVF.RNItE`ITAL AFFAIRS _ wdm DATE: January 23, 1981 [.!si • SUBJECT: PROVINCIAL TRANSFER PAYMENTS TO P!UNICIPALITIES FOR 1981 ~ ' Enclosed is a copy of my Remarks and the Press Release on the Provincial Transfer Payments to Municipalities for 1981. The announcement was made Thursday, .January 22, 1981 to representatives of the three major municipal associations. Total transfers to municipalities and their agencies will be $2.2v billion, an increase of 9.6 per cent or almost $200 million more than 1980. Unconditional Grants from the Ministry of Inter- governmental Affairs will increase to about $582 million from • $~32 million in 1980, an increase of $50 million or 9.2 per cent. The major increases in the Unconditional Grants are in the Police Per Capita Grant and the Resource Equalization Grant program. Several other Ministries were represented at the , meeting yesterday. Those that have not already informed you of their transfer programs will do so shortly. The Ministry of Intergovernmental Affairs will be arranging a series of technica]- meetings for municipal officials on the Ministry's Unconditional Grants program for 1981. You will be notified shortly about the dates and places of these meetings. ~. ~~~ ~ ~~ Thomas L. hells S ff~-... [i`>CF~ I =;:; REMARKS BY: The Honourable Thomas L. Wells Minister of Intergovernmental Affairs RE: PROVZNCIAL TRANSFER PAYMENTS TO MIINICIPALITIES FOR 1981 Thursday, Sanuary 22, 1981 I am very pleased this afternoon to be able to provide details on the funds which the provincial government will be transferring to municipalities and [heir agencies in 1981. At the outset, let me say that I regret the delay in making. these announcements. I am aware that municipalities are into their budgeting process for this year -- and that earlier knowledge of the figures discussed here this afternoon would have been helpful to you in your deliberations to Finalize your budgets. However, there have been reasons for this delay. You will not be interested in all of the details in our processes, but I can tell you that the inconvenience will be more than offset by some of the features of the financial package *.uhich has finally taken shape. No municipal politician or staff person need to be reminded of the financial pressures which all of us face. G1e face them at Oueen's Park, too. So does big business, small business, and virtually all citizens of this Province who are the ultimate providers of the funds with which governments work. m ~_, Y r t +: -2- So, as municipal councils study the grant figures and their ultimate budget requirements over the next few days and weeks, let me say that all of us should do so from a position of understanding: ., understanding that severe budget pressures are not unique to municipalities, but are very real for the province too: ... understanding that the government has really made extra effort to turn over to municipalities ,just as . much financial assistance as our budget would allow at this time; ... and understanding that both municipalities and the provincial government are essentially partners with the overall responsibility of providing adepuate and proper services to the people aho nay the bills -- the taxpayers -- within the limits of the total funds which are available. In 1981, the provincial government wi_11 provide the • municipalities of Ontario, and their agencies, transfer payments totalling $2.240 billion. This is by far the. largest amount ever allocated in this way. It racognizes the. impact of inflation and other factors an budr,ets. It is an increase of about S195 million over 1980 transfers and it represents an overall increase of 9.6 per cent. It should be specifically mentioned that the largest percentage increases will be in areas such as police, health and social services which are facing the greatest cost increases at this time. I_ ~` " -3- ~° In addition to the basic information which is being provided to you this afternoon, representatives of various Ministries are here to explain and answer your Questions about the Transfers that will be forthcoming from [heir respective nroQrams. h For my own Ministry -- Intergovernmental Affairs -- I can report that the unconditional grants to municipalities in 1981 will increase from $532 million to about S582 million, a substantial increase of $50 million, or 9,2 per cent. In recognition of municipal viewpoints and resolutions, and the legitimate demand for increased support for police costs, the grant rates for the Police Per Capita Grant will be substantially increased. The other major initiative for 1981 is the introduction of an improved Resource EgUalization Grant, I believe this is the right course for a number of reasons: it provides the greatest benefits to municipalities with relatively weak tax bases; it provides additional funds that are not associated with any particular service; the grants Reform Committee recommended delivery of additional funds through the Resource Equalization Grant as the grant base became more reliable. I believe that the undated factors coupled with the new policy meet this criteria, -4- The details on the major grant programs from Intergovernmental Affairs for 1981 are as follows: (1) Police Per Capita Grants will he ifinroved through a $2 E. increase. Grants for regional no lice forces will increase from $15 to $17 per capita and from $10 to S12 for other municipalities with their own police forces or a service contract with the OPP. Therefore, municipalities ~,. providing police services will receive an increase of ~ • approximately $16 million to $110 million from $94 million, about 17 per cent more in 1981. (2) General Per Capita Grant rates will remain the same and the grant will change marginally to about $78 million s: ~'~- from $77• million. ~ (3) 'Lhe General Support grant will continue to provide an amount equal to 6 per cent of the previous year's net general dollar levies to all municipalities. - ~ This year. about $181 million will be _ `'' transferred to municipalities in this way, which is an increase of about $16 million over 1980, or about 9 per cent. (4) Special Support Grants for Northern Ontario municipalities will continue to deliver funds equal to 18 per cent of their previous year's net general dollar few , in , addition to the 6 per cent General Support Grant :- c: available to all municipalities. ~~ A total of about $48 million will be allocated in Northern Ontario through this special grant in 1981; an increase of about 5 per cent over the S46 million ~ paid in 1980. -5- (5) The Density Grant will remain at about $5 million. (6) The 1981 Resource Equalization Grant payments to municipalities will increase by about $15 million this year to $159 million, from $144 million, which is an overall increase of about 10 per cent. The Resource Equalization Grant will be changed for 1981 in the system of discounting residential and farm property in the grant calculations, We all know that municipalities tax residential and farm property at a much lower proportion of value than is the case with industrial and commercial properties. The formula therefore, discounts to 55 per cent the value attributed to residential and farm properties. This will enable us to overcome some disparities between municipalities and allow a much fairer distributinn of Resource Equalization grant funds among municipalities. The discounting here follows the same principles which • I announced back in July for apportionments in 1981, Obviously, the updating of equalization factors and the introduction of a modified formula may mean that some municipalities find themselves entitled to a smaller grant than would have been available to them under last year's factors and formula, Our guarantee -- in accordance with the Government's practice when a change is introduced -- is that we will ensure thst no municipality will receive fewer dollars in Resource Equalization Grants =~~ ~. in 1981 than was received in 1980, regardless of how the new calculations come out, i `' -6- Those municipalities which will benefit under the new Resource Equalization Grant program will realize that benefit up to a maximum increase of $7 per capita over what they received in 1980 The standard Eor 1981 grant calculations will be 518,600 per capita. Our Ministry staff is here to explain the details of the Resource Equalization Grant. , ~ * ~ Over the past six months, there has been a good deal of constructive discussion about our apportionment policy. Last July, I put forward a pronosal for the use of the 1980 equalization factors to determine municipal apportionment in 1981 You may recall that the basic idea was to align the method for sharing upper-tier costs with the assessment base used for local property taxation. In this way, we recognize the fundamental fact that the ability of municipalities to raise taxes on residential and farm properties is generally much less than their ability to raise [axes on commercial and industrial properties. The idea ofthe proposal met with a positive response both From municipal organizations such as AMO and from individual municipalities The reaction was overwhelmingly in favour of proceeding with the system as a foundation for further reform. And so, this afternoon, I am pleased to confirm that this will indeed be the case for 1981. I should again point out that, in implementing this new method of determining municipal apportionment, Provincial protection Yw grants will ensure that no municipality in [he Province, as a direct ~.;=-~~. ,; i result of the new system, will incur a tax increase in 1981. ~. I -~- Speaking personally, I believe this approach - coupled with other changes and improvements, like toda~~'s grants package and the ongoing re-assessments under Section 86 of The Assessment Act, which has been well received -- represents a strong and lasting link in the continuing chain of improving the broad structure of municipal finance in Ontario. Over the next while, we will follow our usual consultation practice by arranging for a series of technical meetings for municipal officials throughout the Province on the 1981 grants and apportionment policies. so that everyone is fully aware of the impacts for their municipalities during the coming year. You will be notified shortly about the dates and places of these meetings. ~; b Ministry of ~' ~ r ~~y~y e Intergovernmental a ~ `~ y %`~ ~i ~ ~, ~.~ ~..1 Affairs ~~ r ~ ~ ~ ~ ' ' ~~ d ~ i ~, c z~ .. ~ ~ ° el _ v' ~~~ __ Eir~~1U~~ For irrmediate release JAN 2 81981 Ianuary 22, 1981 QUEEN'S PARK TO TRANSFER 52.2 BILLION TO MUNICIPALITIES IN 1981 TORONTO -- Intergovernmental Affairs Minister Tom Wells announced today the transfer of funds from the Provincial govemment to all Ontario municipalities this year will reach an all-time high of more than $2.2 billion. • Over last year, this amount represents an increase of more than nine (9) per cent,or almost $200 million. Mr. Wells said despite severe budget pressures, the Provincial government "..has really made every effort to turn ever to municipalities just as mlch financial assistance as our own budget would allow at this time". • Mr. Wells was particularly pleased to note the largest percentage increases will be in the areas of policing, social services and health. The record amount of money to be transferred to the municipalities, Wells added, is proof of the Province's continuing cortmitment to ensure the best possible financial support to local governments. Ref.; D. btassicot i 965-4706 M. Rebane For immediate release January 22, 1981 POLICE GRANTS TO INCREASE 17 PER CENT IN 1981 TORONTO -- As part of the Province's total commitment to municipal governments, Tom Wells the Minister of Intergovern- mental Affairs today announced that per capita grants for policing will increase substantially this year. The Provincial Government will make available an additional $2 per capita or 17 per cent more money than last year, well above the current level of inflation. Municipalities now receiving $10 per capita for policing costs will see a 20 per cent improvement to $12. Those now receiving $15 will get $17 per capita. Mr. Wells said this is done in recognition "of the legitimate demand for increased support for policing costs". More than $110 million will thus be earmarked for those munici- palities having their own police forces. This sum represents an increase in dollar terms of some $15 million over last year. -30- Reference: D. t4assicot M. Rebane 965-4706 For immediate release January 22, 1981 RESOURCE EQUALIZATION GRANTS: MAJOR INCREASE TORONTO -- The Provincial Government today announced it will increase by some $15 million its total commitment to municipalities under the Resource Equalization Grants (REG) program. Tom Wells, the Minister of Intergovernmental Affairs, who is responsible for the program, also announced some important changes in the grant calculation. The discounting to 55 per cent of the value attributed to residential and farm properties will "enable us to overcome serious disparities between municipalities". The REG program will con[inue to guarantee, however, that no municipality will receive fewer dollars this year than last, regardless of how the new calculation might apply. REGs are designed to ensure that municipalities with a smaller tax base are compensated by the Province for their lack of revenues and are able to maintain their taxes at a fair and reasonable level. With these changes, municipalities may get per capita increases of up to $7 over what they received in 1980. - 30- Ref: D. Massicot M. Rebane 965-4706 r For immediate release January 22, 1981 UNCONDITIONAL TRANSFERS TO DRINICIPALITIES UP OVER 9% IN 1981 TORONTO -- The Provincial government will transfer $582 million unconditionally to municipalities during 1981. This represents an increase of over nine (9) per cent from last year's amount. Details of our major grant program are: 1) POLICE PER CAPITA GRANT; To all qualifying municipalities. Up more than $15 million, or 17 per cent far policing costs. 2) GENERAL PER CAPITA GRANT: To all municipalities. Will be $78 million in total. 3) GENERAL SUPPORT GRANT: To all municipalities. They will receive funds equal to six (6) per cent of the net general dollar levy of last year. Total allocation is $181 million, an increase of 9 per cent over 1980. 4) SPECIAL SUPPORT GRANT: To Northern Ontario municipalities. Funds equal to 18 per cent of municipalities' net general dollar levy of last year. Total allocation is $47.9 million. (These municipalities also receive the General Support Grant.) 5) DENSITY GRANT: To all qualifying municipalities. A special per capita allocation totalling about $5'~ million. 6) RESOURCE EQUALIZATION GRANT: To all qualifying municipalities. A sum of $159 million, 10 per cent more than last year, to help municipalities with smaller tax bases to maintain the Provincial standard. ~tA-