The City of Brampton is undertaking its 2023 municipal budget, an annual process to allocate more than $1.3 billion in expenditures, that the Brampton Board of Trade participates in and provides suggestions and feedback that reflect business community concerns and priorities.
Municipal budget review and analysis by the business community is led by a sub-committee of subject matter experts that are members of Brampton Board of Trade’s Policy & Government Relations Committee. This year’s areas of focus for our analysis and feedback are expected to be:
1. Property Tax Rates: The City is planning to collect 7.3% more this year than last for its share of taxes. That translates into an overall 5.8% property tax increase for local businesses and homeowners when combined with Region and School taxes. This surprise increase should really not be a surprise at all. The Brampton Board of Trade has been warning its members to anticipate a huge spike given 3 years of 0% from 2019-2021 and a 1% increase in 2022.
At a recent city budget consultation with the business community, it became clear that, as of yet, City Council has not asked staff for a set of recommendations to reduce this increase to a more palatable level for businesses and residents. It appears no options are being presented to Council. Why not?
Also, while other municipalities such as Mississauga and Peel help businesses prepare by providing multi-year property tax forecasts, the City of Brampton will not. It would be very helpful for Brampton businesses to have an idea of estimated property tax rates over the next 2-3 years to offer investment predictability. Peel can do this for 3 years. Mississauga does it for four years. Why not Brampton?
One interesting item that Brampton Board of Trade notice noticed was $25 million in reserves related to COVID. It still seems to kept in a reserve, but no detail on a future allocation. It can be argued that the business community is still in COVID-recovery and that using that reserve for economic recovery by lowering the tax increase is an eligible use of this reserve. Brampton Board of Trade expects Council to give direction to staff to ask this important question. When you consider that each percentage of property tax increase represents $4.9 million, can this be used to reduce or eliminate the tax increase?
2. Capital Project Expenditures: Brampton has a long history of budgeting for projects that are often delayed. This puts burden on taxpayers well in advance of seeing the actual projects built. In the 2023 proposed budget, there is approximately half a billion dollars budgeted but it is not reasonable that all of that will be spent in that year. Staff even showed in the budget documents that Brampton expects to spend only $200 million in 2023 for all projects, including ones previously approved. The amount of approved but unspent capital continues to grow annually, sometimes as much as by $200-300 million, with the total sum now over $1.2 billion. With the proposed budget from staff this will exceed $1.5 billion at the end of 2023. Wow!
In its upcoming pre-budget submission, Brampton Board of Trade will encourage Council to require a plan – with deadlines – from staff to get approved projects built and to identify why capital continues to be approved at a rate much greater than can be expected to be spent. Is a reasonable unspent capital number $750 million? Staff should be able to provide more detail, verification and targets for Council otherwise no one will believe the city’s capital budget expenditure forecasts.
3. Signature Projects (Main Street LRT Extension / Centre for Innovation / Downtown Public Washrooms):
Council is assuming that there will be no property tax impact for the LRT extension. Is this a reasonable assumption?
Additional clarity around the business case and funding allotted for the Centre For Innovation should also be requested by Council. $172M appears in the capital budget for CFI. Does Council plan to build it on spec, without a tenant?
Another issue that has been brought forward by the business community is the need for public washrooms for festival goers and others that visit downtown Brampton.
It is important to have clarity on the business case, deadlines, targets and assumptions of funding commitments to ensure there will not be future funding gaps and that milestone projects like these can be completed.
