Now that I have your attention, words matter.

Yes, the Estimates Committee under Chair Greg Martin met on Friday and Monday to consider the consequences to capital project dollars in their last budget deliberations for the year 2019.

Chair Martin, “It is important that we as a council have to be fiscally responsible in how we determine the use of the taxpayer’s money. I will work to develop long-term goals that meet the practical needs of Brantford’s future growth.”

Yes, they decided during the budget planning in 2018 to remove 1.5% of capital projects as an attempt to reduce the 2019 tax burden on citizens. That percentage is approximately $131 million dollars of approved projects and funded from current operating dollars as well as development charges and future debentures. The consequence intended was to reduce the 2019 property taxes while the less known consequence was the need to find $131 million in reductions of current approved capital projects like: police station relocation; downtown corridor reconstruction; Parks and Recreation development; waste management; storm water management; street lighting; transit improvements; Corporate services; Emergency Housing services; Public Works; technical studies for other projects; and maintenance of existing buildings and facilities.

Whew… that’s a big chunk of municipal responsibilities!

What to do? Eliminate these necessary expenses forever or defer them? Add a tax levy to property taxes to accomplish at least some of them…to be determined which ones…? Borrow money, a debenture, which like a home mortgage gets all the money negotiated up front but pays out over time with interest added. Increase the development charges already a part of new private development?

Or a combination of all the above.

Today they went with a hybrid  of the latter plan of a combination of strategies.

First, the decision was made to create a Capital Levy of .75%, to be added onto the tax base during the deliberations for capital spending starting in September. That will generate borrowing power of about $56 million immediately. And yes, that is taxpayer supported: about 46 cents a week added to the average household tax burden. Council weighed this considerably and with much passion and rhetoric. There were forebodings about accumulating debt versus a feeling it was a small price to pay for already identified priorities. Don’t forget the capital budgeting process crosses over a ten-year period and a lot can be changed in that time frame as new councils or ‘urgent’ priorities arise. Ultimately, the motion passed with Councillor VanTilborg absent and Councillor McCreary in opposition.

They looked at all the projects on the table and wanted to hear from staff about all kinds of consequences of doing or undoing these projects. Would there be further expense through delays?  For example, the Mohawk Lake District is considered to be an interesting destination to build a new Police Station, so the cut of design costs would delay a potential move and indeed there is no money allocated for construction anyway. Are there other considerations which would preclude spending money on a building or facility that would otherwise be removed from city responsibility soon thereafter? An example of this would be $250,000 for replacement of windows at the Tourism Centre on Wayne Gretzky next to Lynden Park Mall: staff indicated that building is under consideration for ‘potential disposal’…perhaps Costco location?

Then there is the issue of extending the cap on debentures. Currently Brantford has a cap of 7% of operating budget for borrowing. Some cities, as allowed by the Municipal Act have allowed up to 25% of operating budget for debentures. Each million debentured costs $1.4million over the term of the loan and added to the tax base. Considering the $131 million eradicated in the last budget, the addition of the .75% added back today, totally $56 million, (pending committee of the whole as Council approval), there is still $75 million needed for the list of items previously accepted.

Hence the report by staff to be considered in September.

Mayor Davis, “Council has a much better understanding of the 10-year capital plan and how it will be financed, and staff have a better understanding of council’s priorities. After today’s cuts in certain projects…the remaining shortfall will be addressed by an increase in the debenture limit and/or removing further projects.”