$58 hospital tax ends for Vaughan residents as city prepares for impacts of Bill 23

Budget includes increase of 2.9-per-cent on property tax for 2023, but larger increases may be coming in following years

Yorkregion.com
Jan. 26, 2013
Brian Capitao

The City of Vaughan’s Proposed 2023 Operating Budget will not fully flesh out the effect of Ontario’s Bill 23, the More Homes Built Faster Act, 2022. At least, not yet.

Currently, the city is considering its options. The City of Vaughan has previously been praised for its fiscal responsibility and has prepared for a modest increase of 2.9 per cent on property tax based on last year’s budget. Property tax remains one of the main sources of city revenue.

As municipalities figure out how to bite the bullet after losing a good portion of revenue from Development Charge (DC) fees, cities across the GTA are asking for more from its residents. Right now, Vaughan’s property taxes are among the lowest in the GTA. It has been estimated by city staff that an increase of 77 to 88 per cent would be needed to make up that loss should the city not be able to find growth-related revenue in the future. While this increase may not be seen all at once, it could mean double digit increases in property taxes in Vaughan are coming soon.

“The City of Vaughan's proposed 2.9 per cent property tax rate increase for 2023 addresses existing and immediate operating pressures for the 2023 fiscal year. It does not offset growth-related revenue losses expected to occur because of Bill 23,” said Justin Gaul, a communications spokesperson for the City of Vaughan, in an email.

City Chief Financial Officer, Michael Coroneos, cited 21 per cent over five years, or an increase of 10 to 12 per cent for 10 years in property taxes, as potential options to help off-set the loss of DC charges, should the city not find growth-related revenue elsewhere, according to Coroneos in a previous Committee of the Whole meeting.

However, it’s not all bad news. Vaughan’s budget this year has seen the completion of the hospital tax levy, resulting in a $58 reduction on average in residential property tax bills. The hospital levy had been expected to be completed over the course of 20 years and finished seven years ahead of schedule.

That’s where the good news stops. Significant increases are going to be seen this year in construction and oil and gas will put additional pressure on the city’s operations, with natural gas going up 23 per cent, the cost of fuel going up 36 per cent and the cost of contractor materials going up 13 per cent respectively.

Also of note in the city’s budget was the increase to water treatment. An increase of 3.3 per cent for water and wastewater treatment will come into effect April 1. On average, there will be a 5.2 per cent increase on stormwater charges.

“As Vaughan continues to mature and intensify, the shift in household units from singles and semis towards smaller format townhomes and apartments is continuing. This has resulted in the challenge of planning for and funding the different service requirements that come with intensification,” said Coroneos.

The City of Vaughan expects that by 2042 the city will have grown to about 489,000 people and over 307,000 employees.