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Support for ‘Local Share’ plan to fund infrastructure

UPDATE OCT 23 – Following much debate, council supported the Association of Municipalities idea of raising funds specifically for infrastructure by raising the HST by one per cent.

If the AMO were successful in lobbying the idea, the County could stand to gain about $6.5 million a year to be used for needs related to roads, bridges and transit.

OCT 12 – Most of the County’s councillors are interested in a ‘Local Share’ plan proposed by the Association of Municipalities of Ontario (AMO) to raise funds for infrastructure by hiking the HST by one per cent.

Committee of the Whole approved support of a motion by the AMO that aims to reduce the pressure on property tax increases while providing a more diverse source of revenue to build communities.

Matthew Wilson, AMO senior policy advisor explained the idea now starting to be pitched to more than 400 municipalities across the province. The one per increase to the provincial portion (now eight per cent) would move the HST rate to 14 per cent – a combined rate Ontario has seen previously.

The County could stand to gain about six million annually.

Incorporating property taxes, user fees, provincial and federal monies, Wilson said a funding gap of about $4.9 billion is projected annually for the next 10 years to maintain current service levels and finance infrastruture needs.

In August, all three provincial parties dismissed the idea of the tax hike aimed at helping municipalities raise billions of dollars needed to fix roads, bridges and transit.

Mayor Robert Quaiff, who is also an AMO director, said it’s a good resolution for municipalities to get behind and to show the provincial government support for an idea.

“Every municipality is struggling and the County itself would need more than $30 million per year for the next 10 years to bring roads up to standards,” he said.

“AMO’s role is working on our behalf. We always get told by various ministries and others to think outside the box, come up with some funding mechanisms, come up with alternatives for us. And this is what AMO has done. They have given this idea for any level of government to look at and say ‘maybe we should consider that as a revenue generator’.”

Not all councillors agreed with the plan. Diane O’Brien said she sees it as another tax hike on the ratepayer and Councillor David Harrison agreed.

Councillor Kevin Gale had reservations for ‘vulnerable residents’ unable to handle an increase and didn’t want to let upper levels of government off the hook because they’re not spending their money appropriately.

“There’s a segment of our population that an extra one per cent more on necessities (heat, hydro etc) would be a big deal,” said Gale. “The governments have the money, it’s just about where they’re spending it.”

“We’re tabling this idea for the long term, and includes rebates for low-income people,” said Wilson. “The other option is an eight per cent increase per year, for 10 years, in property taxes,” said Wilson. “We think this is the affordable option to spread the base over a wider group of individuals,” he said, noting the AMO has polled Ontario residents three times and most support the idea of the one per cent of funding if it goes directly to local municipalities who ‘understand their fiscal challenges’ and not to the provincial government.”

The resolution will go to a council meeting for final approval. The AMO is continuing to seek member support throughout the province.

Filed Under: Local News

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