What’s in store for 2023 property taxes?

What’s in store for 2023 property taxes?

The first chapter of Oakville’s 2023 property tax story is in draft.

In documents released Dec. 14, the Halton Region proposes a $1.1 billion operating budget that will increase property taxes by 3.4 percent next year.

That would mean that the owner of a property valued at $1 million would have to pay about $93 more in local taxes next year.

Regional taxes pay for police, paramedics, waste disposal, social services, public health, council housing and regional roads.

Oakville’s entire property tax bill combines state, city, and education taxes. Details on the district and education section will not arrive until next month.

Members of the public and regional politicians still have an opportunity to comment on the proposed Halton budget at meetings scheduled for 18th and 25th January.

Police costs continue to rise

The total operating budget for the region is $1.1 billion, including $186 million in planned Halton Police Department spending.

The 2023 police budget has increased by 5.7 percent compared to the 2022 budget.

In a report to the Halton Police Board, Chief Stephen Tanner says the increase is needed to fund 20 new officers and 5 new civilian positions in response to “new trends and continued growth in demand for police services”.

He also points to upcoming contract negotiations, inflationary hikes in fuel and construction costs, and increased investment in cybersecurity.

“I believe it is a responsible budget that allows the service to provide the service that Halton residents have come to expect,” said Ward 5 Councilman Jeff Knoll, who chairs the Police Board.

The board has yet to formally approve the 2023 budget at its December 22 meeting.

Water and sewer charges are increasing

Along with higher tax bills, expect your water and sanitation bills to increase by 4.1 percent in 2023.

Water and sanitation services are not funded by property taxes but by user fees. Water is billed via the electricity bill.

The increase includes a 1.7% increase in operating expenses and a 2.4% increase driven by the capital funding required to support capital expenditures.

Uncertain times for budgeting

Volatile inflation and changing provincial regulations combine to create fiscal uncertainty.

Halton’s regional staff budget documents note that “significant cost pressures caused by increased costs of goods, services and works due to high inflation” impacted this year’s financial outlook. While the budget for 2023 includes an inflation assumption of 3 percent, actual inflation was much higher for most of the year, with the consumer price index hitting 6.9 percent in October.

Expected changes in state funding of other programs add to the uncertainty. And while Bill 23, the province’s recently passed housing law, will significantly change regional responsibilities and revenue, many details remain unclear. These impacts were not included in the 2023 budget.

City “financially very well positioned”

With the start of a new council period after the local elections in October, the city will not start its budget process until January.

Councilman Tom Adams, who has chaired the city’s budget committee since 2009, says the proposed regional budget will enable the city to keep its overall property tax increase in line with inflation.

But he warns that the city faces similar budgetary uncertainties for the year ahead, including high and volatile inflation that is driving up costs for salaries and benefits, fuel and materials, and construction in particular.

“If you’re in the world of commercial or industrial construction — and municipalities are because we’re competing for projects that are big facilities and big transportation infrastructure projects — those projects have very significant inflationary implications.”

Continue reading: What will inflation do to your property taxes?

He adds that the city is also facing some “rather dramatic changes” by the province.

“The financial risks associated with provincial changes that reduce municipal funds from infrastructure development are real and significant,” he said. “We continue to wait to see if the province fully completes the communities for this expense.”

But he offers words of reassurance for concerned taxpayers.

“Oakville is in a very good position financially and has been for a number of years,” he said, pointing to a strong stabilization reserve fund that is available to meet unexpected costs

“The city will continue to work to keep its overall property taxes in line with inflation,” he said. “Between city, county and education taxes, we’re trying to create a stable, predictable tax environment for both residents and businesses.”

Budget Committee meetings begin on January 17 and last through February. This year’s committee includes: Mayor Rob Burton and Councilors Adams, Allan Elgar, Janet Haslett-Theall and Sean O’Meara.

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