Draft city operating budget
The draft 2021 city operating budget has been released and will get its first review by councillors on Friday January 15. The initial projected tax increase is 2.9 percent which is equivalent to a $106 addition on an average house assessed at $380,600. Actual current house sale prices have jumped nearly 20 percent in the last year.
The projected tax hike will almost certainly be lowered before it’s finalized in late March or April. Last year at this point it stood at five percent and fell before approval to 2.9 percent which was then described as “one of the lowest increases among comparator municipalities”.
The single largest change this year is a jump of nearly $5.6 million in the police budget. That along with an extra million in capital allocation will push annual spending on policing over $177 million.
Perhaps in response to the city hall encampment and other protests linking homelessness to police funding, the executive summary of the budget highlights “affordable housing”. The emphasis is based on the expected launch of a private development in east Hamilton that will be subsidized by taxpayers.
The budget summary tells us that Roxborough Housing Incentive Program “allows developers of affordable rental or ownership housing units to receive exemptions from the city’s development charges and parkland dedication fees for 10 years after the issuance of a building permit – providing incentive for development of affordable housing units in the Roxborough Community Improvement Project Area.”
The developers bought the former elementary school on Reid Avenue north of Queenston Road. The adjacent city-owned housing consisting of 91 townhouses and 16 apartment units for seniors was then rolled into the project which promises 600 new units including townhouses and three apartment towers. One of the towers will be city-owned subsidized housing but won’t replace all that was lost in the redevelopment.
Exempting development charges for this project will shift $10.5 million in normal growth and servicing costs from developers to taxpayers. Forgiving the parkland fees on top of that is estimated to cost another $4 million that would normally be used to purchase park space. In this instance the 4 acres of open space at the former school are also lost.
The budget indicates that the transit expansion program halted last year will likely be restarted in September but there’s no indication yet if that will be accompanied by another fare increase. The promised 10-year expansion is now a 12-year plan.
Before the pandemic began, HSR routes were cut back by councillors over the objections of transit staff. Efforts to combat the virus led to a much larger ridership crash. Free fares were provided until the buses could be fitted with virus protection barriers for drivers. The combined result was that fare revenues dropped last year from $47 million to $23 million, although provincial COVID-19 subsidies covered the shortfall.
Bus frequency remains restricted on some HSR routes and passenger numbers continue to be severely diminished but the city expects any associated revenue losses will again be reimbursed by provincial grants. The detailed transit budget will be presented on Friday, January 22.
Councillors will examine the departmental budgets over the next few weeks. Residents get a chance to make a five minute comment on Monday, February 8 starting at 3 pm.
