Westmount holds tax increase to 2%

City surplus shelters residents from provincial downloads

By P.A. Sévigny

As expected, and as a result of the provincial government’s new reductions in assorted transfer payments and sales-tax credits, Westmount’s civic leaders voted to use the city’s accumulated budget surplus to help balance the city’s budget, maintain the city’s services and provide city residents with what city leaders hope will be little more than a two percent tax hike.

“In order to shelter the Westmount tax payers from the [provincial government’s] downloading, the city will finance the entire shortfall by using the accumulated surplus rather than increasing taxes,” said city Councillor Victor Drury.

While he expects that a permanent fiscal pact with the provincial government will help relieve the city from at least some of its obligations beyond 2015, the city must still find the means to cover the loss of revenue ($880,000) caused by a combination of the government’s reduction in assorted transfer payments along with further reductions in the provincial sales tax rebates. While the projected cutbacks were already expected to cause serious problems for the city’s new budget, another series of factors—including the rising cost of road salt—created the usual budget conditions that forced the city’s leadership to consider the usual options that includes everything from cutting civic services to raising taxes in order to raise the revenue they need to balance the city’s budget as required by law.

As almost $84 million ($83,761,000 to be exact) make up the major part of the city’s $97 million budget, the balance of the city’s revenue is produced by a number of assorted revenue streams that include the government’s now reduced transfer payments. Fees for assorted services (parking, assorted recreational activities and other activities) add up to some $4.6 million after which the city collects another $6.5 million in court fines and duties on real estate sales and transfer of property within the city.

However, even after every effort was made to control what the city had to spend in order to maintain all of its services, it still costs the city at least $3 million more to provide its services—including the $51 million it pays for the city’s agglomerated services—than it collects in revenue. As the red ink that defines the city’s total expenses has now broken through the $100 million ceiling ($101 million to be exact), the council’s decision to use the city’s accumulated surplus to balance the city’s budget will certainly provide some immediate relief for Westmount’s taxpayers who must now deal with a minimal (two per cent) tax hike that is well within the council’s guidelines that are meant to limit future tax increases to one percent above the contemporary rate of inflation.
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