London is on the hook for $4 million that the provincial government is no longer ponying up for things like child care, public health and policing.
And that’s just the estimated figure for 2019; a report going to the city’s corporate services committee Tuesday pegs the annual cost for the next four years of the multi-year budget at $6.6 million.
“That is a very difficult position for a municipality to be in,” said Ward 7 Coun. and budget chair Josh Morgan.
“We really only have property taxes to use to fund programs, and some of the programs that are being cut at the provincial level are provincial for a reason. It’s because the property tax base is not well suited to fund them.”
City council had set an annual tax increase target of 2.7 per cent for the 2020-2023 multi-year budget. According to city treasurer Anna Lisa Barbon, 2.2 per cent would have been to maintain services, while an extra .5 per cent of “wiggle room” was for growth.
But municipal programs that the province is stepping back from, financially, are things that Barbon says the city is “obligated” to pay for. For example, the city needs to find $2.1 million for childcare, $600,000 for each policing and ambulance service, and $400,000 for public health in 2019 alone.
Since the budget is already set for 2019, Barbon says they’ll look at one-time sources such a reserve or contingency funds.
“The recommendation is that we’re going to continue to work with the province to get as much advance understanding and knowledge that we can to help support whatever best planning we can do over the long term, to try and mitigate the cost increases as possible.”
While he expects the city to be in a “relatively unpredictable fiscal environment,” Morgan says they can prepare for surprises.
“We can certainly build in contingencies into the budget… we can dig into the suite of services we’re offering, and doing a deep analysis on which ones we need to scale back on and which ones we can continue.”
Morgan is anticipating that conversation to be a tough one.
“There’s going to be a number of changes at the provincial level funding programs, where the public, who sees values in those programs, is going to turn to the municipality and say, “These are programs we want to see continue, and we want you to try and pick up the slack to fund these,” he explained.