Quinte West calls for new municipal funding arrangement in ’24 budget
The City of Quinte West is the latest in a series of groups to call on the Ontario government to review its provincial-municipal fiscal framework as part of the March 26 provincial budget.
In early January, the Association of Municipalities of Ontario (AMO) highlighted the need for a social and economic prosperity review as part of its pre-budget submission to the government.
The city says the fiscal framework that municipalities rely on to deliver infrastructure and services is broken – failing residents, small businesses, and major industries. Unlike the province, municipal revenues do not grow with the economy or inflation. New realities, including the pressures of growth, economic factors like inflation and interest rates, social challenges, and provincial policy decisions, are pushing municipalities to the brink.
“The City of Quinte West is experiencing many of the same financial pressures and challenges as all of Ontario’s municipalities,” said Mayor Jim Harrison. “It is important for Quinte West to join AMO’s efforts to encourage a provincial review of how to better align the provincial-municipal fiscal framework with core service responsibilities to meet the needs of our communities.”
Last adjusted in 2008, a review of provincial-municipal financial arrangements is long overdue, the city says. Municipalities continue to subsidize the provincial treasury by almost $4 billion each year by paying for provincial responsibilities such as social housing, long-term care, public health, childcare and social services. Ontario’s property taxes are already the second highest in the country, while provincial spending per capita is the lowest in Canada. Property taxpayers, including small business owners and seniors on fixed incomes, can’t afford to keep paying provincial costs.
As Ontario grows, major investment in essential municipal infrastructure is required to achieve the province’s ambitious target of building 1.5 million new homes by 2031. However, the city says, Bill 23 created a $1 billion annual hole in municipalities’ ability to fund this foundational new infrastructure that will help the province grow.