With a potential budget deficit of more than $300,000, Three Rivers councillors reached consensus last week on a proposed recreation tax of 10 cents per $100 of assessment on commercial properties and two cents for non-commercial.
Staff calculated this tax would generate $240,000 in revenue, including $90,000 for the 10-cent commercial tax and $150,000 for non-commercial.
Council was expected to vote on the 2023-24 budget Monday night, one week after a March 6 budget meeting in which various ways to boost revenue and/or lower expenses were considered.
Major anticipated increases in expenses were built into the budget, and the town is gradually being weaned off provincial funding agreed upon at amalgamation.
At a previous meeting, council was told the draft budget had a $7,000 surplus before any of the annual grants to town-owned recreational and cultural facilities were factored in. The recreation tax was proposed to maintain that support for facilities, which would not be sustainable otherwise, said outgoing CAO Jill Walsh. She said the province has not given an answer to whether the Memorandum of Settlement allows property tax increases, but that there is no limit on another tax.
After council decided on grant amounts for various facilities and community groups, some of which were reduced from what was requested, that left a deficit of about $320,000.
“We have a deficit and we need a solution to cover it,” Mayor Debbie Johnston said.
Financial officer Ashley Higginbotham said the idea of a facility tax is not new, as local communities added a temporary tax to help fundraise for the construction of the Wellness Centre in Montague.
Councillor Martina MacDonald said she supported the tax because of all the facilities Three Rivers has, suggesting the town could issue a press release explaining the reasoning to avoid an outcry.
“I don’t like tax increases at all, but I understand our situation,” added Councillor John Van Dyke. He said after the provincial election the town should approach the province about extending its amalgamation funding agreement.
Councillor John MacFarlane said the town has been investing in infrastructure since amalgamation and the tax was needed, despite being a tough pill to swallow.
Mayor Johnston said some people are “under the impression we’ve raised taxes” since amalgamation. Property taxes were doubled for non-residents last year, but full-time residents of the town have not had any increases.
Councillor Alan Munro said it was time to start charging a tax for vacant commercial buildings because “they’re not bringing much to the community right now.”
Ms Walsh said the wheels could be set in motion to do that in next year’s budget.
Other suggestions discussed included putting a call out for rentals of vacant town-owned buildings like the former Georgetown library, selling town land in Georgetown and making those lots more attractive to buyers, maintaining current sidewalks instead of adding more, closing the Georgetown office and asking the Georgetown Fire Department about taking over ownership of their fire hall to cut costs for the town. It was agreed the latter could not happen without significant discussions with the fire department.
Councillor Cindy MacLean said she did not support the closure of the Georgetown office and felt money could be found elsewhere. It costs the town $8,320 a year for employees to travel to the Georgetown office. Staff take turns working there a day at a time.
Councillor Van Dyke said although he wasn’t on council when amalgamation-era assurances were made, he sees the office as a redundancy of service.
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