How city council dodged discussing the two per cent infrastructure levy

By Gerry Barker

Posted December 19,2016

In a report in the Guelph Tribune, it stated that the city was considering a ten-year, two per cent levy on property tax stakeholders to pay for the aging infrastructure of our 200 year-old city.

The accunulated ten-year total amounts to $285 million, and its all coming from property taxes.

The report stated that city financial chair, June Hofland, at the beginning of the December 9 budget meeting moved to send the staff initiated report to the corporate services committee.

As I was at that meeting for eight hours, from start to finish, it took to defeat the operating and capital budget, not once did I hear the words: “Two per cent levy for ten years” spoken by any member of council. There was no further discussion or explanation and the report was approved unanimously.

Thanks to some diligent reporting by the Trib’s Doug Hallett, the details of the report, created by the Association of Municipalities of Ontario (AMO), were quoted at length.

Now you have to ask the question, why was this major report not included in the 2016 budget considerations? Why? Because of the fear that including it would create a huge property tax increase. With the 2.99 per cent final tax increase, adding another two per cent would bring the 2016 tax increase to 4.99 per cent.

Even the Gang of Seven supporters of the former mayor, lacked the courage to try that on for size this time around. So, like the $8.96 million used to pay the Urbacon Buildings Group lawsuit settlement, they kicked the two percent levy can down the road.

Obviously this bombshell report advanced by the staff before the crucial budget deliberations, was discussed in camera before the meeting. Hofland was chosen to get it off the table and move that the report be sent to the Corporate Services Committee to be discussed at its February meeting.

Kicking it down the road illustrates how a dysfunctional council is unable to control its spending chiefly because of the 7-6 voting edge held by the Gang of Seven.

As for the AMO report, consider that it is an organization funded by the provincial government. Taking it one step further, it is an attempt to divert its responsibility of supporting municipalities to fix its estimated $60 billion infrastructure’s needs onto the backs of ratepayers.

Just look at the mess the Kathleen Wynne Liberals have made of the province’s finances, in which successive budget deficits have resulted in ballooning debt and growing debt service costs. They have dug themselves into a financial hole that, they now assume, can only be solved by selling off assets (Hydro One) or off-loading infrastructure costs onto the municipal taxpayer.

In Guelph, the problem is exacerbated by nine years of financial mismanagement, centred on irresponsible spending. It has resulted in Guelph having one of the highest property tax rates and user fees in the province.

An independent study by Guelph resident Pat Fung, CA, CPA, compared the operating and capital costs between Guelph, Cambridge and Kitchener. He used each city’s official annual financial reports to the province, proving that Guelph’s costs are 50 per cent higher than either of the other two cities.

Despite these findings, the Gang of Seven on city council pushed to add more staff, and more project costs onto the backs of the people. Staff costs are 80 per cent of the property tax levy. Yet it doesn’t seem to concern the council majority or the senior city staff.

In a letter to the Tribune Alan Pickersgill, a follower of the Farbridge leftist agenda, says: “The city does not have a spending problem. It has a revenue shortage and a constituency that appears unwilling to do what is needed to correct it.”

Well Alan, it is clear that you have joined the “no-brainer” financial theorists on council and staff. The disastrous financial mistakes and errors in judgment, made by the previous administration, amplify your sweeping assertion that it’s okay to soak the taxpayers to pay for it.

It now appears that those three reserve funds that were raided to pay off Urbacon will not be repaid today, tomorrow or in the next five years as promised by Chief Administrative Officer, Ann Pappert.

I am one of your “constituency” folks who do not have faith in a chair of finances whose financial experience and work history as a bank teller now oversees the finances of a $500 million corporation. Or depending on a recently hired General Manager of Finance whose qualifications lay in non-financial jobs in Halton Region, chiefly involving social services. Why should we be confident of a Deputy Chief Administrative Officer, Mark Amorosi, to be senior controlller of city finances, who resides in Hamilton and whose background is Human Resources?

With the exception of Hofland, these people have no skin in the game. They are hired guns and in terms of financial management, do not have any apparent professional financial training, including academic credits.

Until city council hires an experienced Chief Financial Officer to take the necessary steps to clean up the mish-mash of financial management, the city will continue its downward spiral to a serious future financial disaster.

Maintaining the influence of the former Mayor and her agenda has become the Farbridge Factor. It’s a spectre of eight years of setting the city on a course that will take years to recover if the failed system of irresponsible budgeting continues.

If you need more evidence of how our public business is being managed, look no further that the deliberate sandbagging of the AMO report just before the beginning of the 11-hour marathon deliberating the 1016 budget.

It’s just more mushroom politics by our council by keeping us in the dark.

 

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6 Comments

Filed under Between the Lines

6 responses to “How city council dodged discussing the two per cent infrastructure levy

  1. Glenn Greer

    The surprise 2% proposed surcharge for 10 years is really just a tax increase. Inflation is under 2% so why should our taxes go up by more ?

    Any implementation of a 2% (or less) surcharge in addition to the already high increase, should be subject to a referendum. This would be costly and fail, of course.

    Too bad that there is no way to recall the current council and have a re-election.

    Glenn Greer

  2. Joe Black

    Where do we start and how do we change things ? Look at Woodlawn Rd that should be six lanes wide with a left centre turn lane . Look at Laird Rd overpass going West it veers south instead it should continue straight on towards Downey Rd my 11yrs old kid could figure that one out and he doesn’t have an engineering degree.Clair Rd and Vic should have a traffic light and should be four lanes wide I know I know we have to accommodate the five bicycle I saw this summer.Sorry about the rant.

  3. Glen N. Tolhurst

    It is time for a reality check of the numbers being tossed about for tax increases.The council approved a 2.99% tax increase when the CPI increase from Oct 14 to Oct 15 was only 1%. Then, by slight of hand or as a sin of omission, the 4.62% tax increase to finance a portion of capital spending was shuffled off to be financed by debt (at an unspecified interest rate for an unknown number of years) rather than being paid for in the normal way thru tax money from the operating budget. This 4.62% shuffled off to debt is from a quote by the newbie GM of Finance & Treasure in the Tribune on 8 Dec 15. Nary a peep from anyone that this, when added to the 2.99%, would give a tax based spending binge of 7.61 % for 2016. Now from left field, pun intentional, a special infrastructure tax levy of 2% for 10 years comes front and centre. This comes from “staff” (whose salaries are paid by taxpayers) just as the budget deliberations are being made with no one on council having the backbone to bring it out of the backroom. Talk about blind siding the public. To put the 2% in perspective, it is to be rolled into the base tax rate and compounded annually which amounts to a 21.8% increase. However, the staff backers of the 2% levy want it to be in place for 2016 which would bring the increase to 9.61% for the year. What planet are they living on and perhaps what city are they living in?
    The taxpayers have to revolt at the continued unsustainable tax hikes masterminded by the bloc of 7. Yes, a recall would be nice, but since that can’t happen, taxpayers have to write, e-mail, or phone their councillors to let them know the tax hikes are unacceptable. Hold councillors accountable!!

  4. Gerald

    I do not understand why they cannot tap into the liberal(trudeau)pledge for
    money for infrastructure.Was not that the big headliner on the election.Even wynne was blowing the same horn or is that only for Toronto?.The federal government shipped all that infrastructure/welfare/health problem to the municipal government but not the money to support it.The big problem with the block 7 is they think they live in Toronto and not in little ol Guelph.

    .

  5. Tony

    They could be like the liberals and start selling assets. Sell the museum to the school boards. There the only ones that use it.
    Same goes for river run center and hockey arena. It took YEARS for sleemans to finally pony up some dough for the naming rights. I wonder how much time and salary was wasted on trying to find a company for the naming rights? Most places built have that figured out before the shovel even hits the ground. How many concerts or events are booked in there other then hockey?
    Does the river run center turn a profit? If not why not? If it doesn’t sell it to someone who can.
    Do the salaries and deficit from the Guelph holding company factor any way into the budget? Start cutting that albatross Like a Christmas turkey!
    All that fat would probably trim close to 50-75 fte’s off the books at the same time.

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