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Council committee to discuss $31-million surplus in London, Ont., budget on Monday

London, Ontario's city hall as seen in October 2021. Matthew Trevithick / Global News

A council committee in London, Ont., will meet on Monday to discuss a new report that shows the city posted a $31-million surplus for 2023.

The extra money appears to have been caused by higher than anticipated interest rates, which helped city investments perform better than expected.

It’s unlikely, however, that the surplus will reduce 2024 taxes.

Budget chair and councillor Elizabeth Peloza says some of the surplus is taxpayer money, but over half is income on investments made by the city.

“We know interest rates have gone up and they’ve out-performed what we’ve budgeted for, which is terrible if you’re trying to borrow. But if you have investments, it’s great,” she said. “So, over $14 million came back to us that wasn’t even originally taxpayers money, but (what) we invested generated revenue and came back to us to be reinvested in our community.”

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Peloza also says that the budget committee can choose to follow an existing formula to build reserve funds and reduce city debt, or it can choose otherwise.

“They can always decide not to go with the policy that we’ve been following for years (that) I believe has served us well. But then that goes to council as a whole, and then that money is used in future upcoming years as things are needed,” she said.

The report comes weeks after city council finalized a multi-year budget that included an 8.7 per cent increase in property taxes for 2024.

The city’s Corporate Services Committee will review the report on Monday at 1 p.m.

-With files from 980 CFPL’s Emily Passfield and Mike Stubbs

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