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HomeMy WebLinkAboutTR-60-84 4 CORPORATION OF THE TOWN OF NEWCASTLE TREASURY DEPARTMENT K. CAMPBELL,C.A.,TREASURER 40 TEMPERANCE STREET TEL.(416)623-3379 BOWMANVILLE, ONTARIO L1C 3A6 REPORT TO THE GENERAL PURPOSE AND ADMINISTRATION COMMITTEE MEETING OF JULY 3, 1984 REPORT NO. : TR-60-84 SUBJECT: 1984 ONTARIO BUDGET RECOMMENDATION: It is respectfully recommended that the General Purpose and Administrative Committee recommend to Council that this report be received for information. BACKGROUND AND COMMENT: Subsequent to Council Resolution #C-405-84, staff have endeavoured to evaluate the impact, on this municipality, of the recent Ontario Budget. General comments included within this report have been extracted, for the major part, from the Minister' s budget statement. The main theme of the Provincial Budget as it relates to Municipalities is quite obvious, government restraint. The Minister has stated that in order to keep deficits and taxes down, governments at all levels must control their own expenses. In 1984, it is expected that local governments will attempt to restrain their staffing and direct operating expenses and certainly to incorporate such restraint when preparing their 1985 budgets. REPORT TO G.P.A. MEETING OF JULY 3, 1984 TR-60-84 1984 ONTARIO BUDGET Page Two BACKGROUND AND COMMENT: continued Indications for 1984 are that some spending increases in the local sector this year will exceed what the Province considers to be appropriate and, while it should not be necessary to control mill rates formally, consideration is being given to ways in which the Province can more closely monitor the spending performance of local governments. While municipalities are being asked to control their expenses, the Minister has stated that homeowners who undertake renovations or additions, specifically to keep elderly or disabled person at home and in the community wi l l be exempt from any increase in taxable assessment that would otherwise occur. Also, homeowners who are elderly or disabled themselves will also qualify. This, in effect, .will prevent an increase in the assessment base and thus reduce revenue required to maintain services demanded by the ratepayers. Other alternatives should be considered as it appears that the Province is concerned about expenditure increase while at the same time limiting the growth of the assessment base which is the municipalities major source of income. While it can be said that this particular program will have a very small impact it does set a very dangerous precedent in terms of provincial municipal taxation and revenue sharing. Transfer payments to municipalities for 1984 have been held to five percent to reflect increase in inflation for goods and services and a similar increase for salary costs. The Town has been well-served by the protection- levies built into the 1984 Unconditional Grants Program as stated in report TR-27-84 submitted to Committee on April 16th 1984. REPORT TO G.P.A. MEETING OF JULY 3, 1984 TR-60-84 1984 ONTARIO BUDGET Page Three BACKGROUND AND COMMENT: continued However, .such protection may not be available for 1985, as it is apparent that the Province is moving towards a system of administered grants and grant rate increases, which may bear a less direct relationship to the actual costs and needs of the Town. As further information becomes available on this important matter, Staff will report to Committee accordingly. The 4.9% increase in O.H.I.P. premiums, which are 100% paid by the Town will not result in an over expenditure, due to the fact, that a 5% increment in the 1984 premium over 1983 was approved during budget discussion. Charges levied for the right to use publicly-owned water resources in the production of electrical power have not increased since 1958, other than annual adjustments related to the rate of inflation. Effective June 1st, Ontario Hydro' s water rental rates wi l l be adjusted to reflect more accurately the value of this resource. Obviously this increased cost will be passed on to the end user in the form of higher rates. The percent increase and possible impact on the Town' s operating costs are not known at this time. In conclusion, staff feel that the recently announced Provincial Budget will not have a major impact on the Town' s current operations. Staff and members of Council must continue to practice restraint during preparation of the 1985 budget, particularly in view of possible changes to the Unconditional Grants Act. REPORT TO G.P.A. MEETING OF JULY 3, 1984 TR-60-84 1984 ONTARIO .BUDGET Page Four BACKGROUND AND COMMENT: continued These changes may cause a substantial reduction in Provincial funding available to municipalities which would have to be passed on to the ratepayers through higher taxes. Respectfully submitted, Jjohn R. Blanchard, Deputy-Treasurer *gf