Municipal taxes and development charges form the City’s (lopsided) revenue model

Ontario lost a political giant in the passing of Hazel McCallion, two weeks shy of celebrating her 102nd birthday. The twelve-time Mayor of the City of Mississauga was affectionately known as 'Hurricane Hazel', having spent decades as a whirlwind champion of municipal government. People from all strands of life, including leaders from every political party, sought her advice and wise counsel.

Mayor McCallion once pronounced that in Canada, “… we have three distinct levels of government: the federal government which has all the money, the provincial governments which have all the power, and municipal governments which have all the problems.”

Building on the Mayor's perspective, let's look at the situation in Hamilton. Our city has control of only 46% of total budget expenditures. The other 54% of costs, including things like public health, social services, social housing, etc., are mandated by the two senior levels of government.

As Ontario's Minister of Municipal Affairs & Housing, I had frequent contact with Hazel. I once asked her how she went about setting development charge fees for new municipal growth. The always candid Mayor said, “if after setting out your charges, the developers aren’t suing you, then you haven't done your job!”

Hamilton has a lesson to learn. The city’s two major sources of revenue generation come from property taxes and the fees paid by developers in relation to urban expansion. That said, those funding models are not balanced. Did you know, Hamilton's industrial/commercial to residential property tax ratio is 14% to 86%? That's a problem. It forces residential taxpayers to balance the scale and pay relatively more compared to residents in other municipalities. Add to that equation Hamilton's $3.4 billion cumulative infrastructure deficit, much needed water/sewer improvements, and necessary expenditures on policing, fire fighting, EMS, snow removal and waste collection. Combined, we get a stark grasp of the fiscal challenges facing our city in the near term.

Looking ahead, as Councillor my focus will be getting better value per tax dollar in ward 15, while supporting a greater emphasis on industrial / commercial growth in Hamilton, to balance the ledger for ratepayers. That’s not an easy task, but it is one I will focus on intently moving forward.