Newmarket weighs service cuts in face of 7.67% tax hike

Newmarkettoday.ca
Feb. 1, 2023

Newmarket council may consider some cuts to services as it grapples with a possible 7.67-per-cent property tax increase at the start of 2023 budget talks.

Staff presented the figure today, Jan. 30, calculated in part due to the historic inflation of recent years. The figure represents a $173 increase on the property tax bill of the average Newmarket homewoner this year.

Newmarket Mayor John Taylor said these are unusual times as a result of the extreme inflation, and there will have to be some good conversations in the weeks ahead.

“In my time here, this is the most interesting and challenging budget I’ve encountered,” Taylor said.

In a presentation, staff noted the impact of inflation, with a 30-per-cent increase in the construction price index combined over 2021 and 2022, and a 10.7-per-cent consumer price index in those years, as well. Staff said they found ways to cut the tax increase by more than five per cent over the course of the internal budget process, which still put it at 7.67 per cent.

“This has been quite a budget,” director of finance and treasurer Mike Mayes said. “In my 22 years of experience with the town’s budget, this has been the most difficult we’ve had to do so far.”

Still, Mayes said assuming an average three per cent increase across the GTA -- which he added could be an underestimate -- the town’s tax rate is still eight per cent below the GTA average.

With the proposed tax hike higher than any seen in Newmarket in at least a decade, council discussed possibilities for bringing it down.

Deputy Mayor Tom Vegh asked staff for information on possible cuts to services. Although he said town surveys show residents do not want service cuts, he does not think that means residents want to avoid cuts “at any cost.”

“There may be areas where slightly lowering, or a decrease, of service levels the public would be tolerated,” he said.

Councillor Jane Twinney said hearing from residents will be critical.

“It’s going to be tough. All of our residents are feeling impacts, just as we are as a town,” she said. “They’re feeling those impacts as well with inflation. This is just another layer of increase of costs to them … I think residents are going to be much more engaged this time.”

The town should look at new revenue opportunities to reduce taxes, Councillor Bob Kwapis said.

“There (are) opportunities of us finding some revenues as well in order to offset some of these impacts,” he said, “(which would) make that 7.67-per-cent number go down considerably.”

But staff identified revenue opportunities in its budget before the council meeting, factored into the 7.67 per cent figure.

Council members agreed to suggest different areas for service cuts, and have staff provide information, as well. Taylor floated examples such as closing a facility for one extra day per week or reducing standards on plowing or sidewalk clearing.

But Taylor said though minor changes are possible, he does not believe Newmarket taxpayers will support service level cuts in any major way.

“This is incredibly difficult,” he said. “We’re in a moment here that’s not very pleasant. We’re going to be judged on the quality of our community five years from now, 10 years from now. Having an amazing community requires us to keep moving forward and investing on behalf of the residents.”

Council will have several more meetings diving deeper into the budget in the weeks to come. Budget approval is currently slated for April 3, with public engagement also planned for the next several weeks.