As reported last week in The Leader, South Dundas Mayor Steven Byvelds floated an idea during the 2022 budget municipal deliberations to add a levy to property tax bills, specifically for infrastructure. The idea was supported in principle by Councillors Lloyd Wells and Archie Mellan and council will discuss this idea at a future meeting. At the end of the budget meeting, Byvelds invited feedback on the idea. Here is our feedback – no thank you.
The levy, pegged at a possible five per cent above and beyond the 2.82 per cent residential tax increase this year, is not for any specific infrastructure project. Instead the goal is to build a reserve fund to pay for future infrastructure needs. Saving for a rainy day, and we acknowledge there is much rain in the forecast.
Many municipalities use levies to pay for specific projects over and above regular taxation. This happens in many larger cities where community infrastructure costs are shared by those in that community or section of the city. But South Dundas is a municipality of 11,000 citizens and not a city like Ottawa with 1,000,000 citizens.
Separate levies to pay for infrastructure and other needs are not unheard of in South Dundas. Water users in Morrisburg and Iroquois in the late 2000s had a $2,000 levy towards the capital costs of that infrastructure. Those users had the option of paying in one lump sum, or installments over five years. In that instance the levy was for a specific and defined piece of infrastructure, paid for a specific period of time. An infrastructure levy with no specific goal, no end date, and no target is unfair.
The idea of an infrastructure levy puts money in the municipal bank account for future infrastructure needs, and that is the wrong place for it to be. Tax money should stay in people’s pockets until such time as it is needed. Building reserves at a time when the financial resources of citizens are already stretched to and beyond their means is unacceptable.
There are many tools in the municipal toolkit for paying for infrastructure and other capital needs. These include debt financing, general taxation, and development charges. South Dundas does not have specific development charges, yet neighbouring municipalities have implemented these, to their benefit.
This council during this term has accomplished many infrastructure updates after prior years of neglect. Neglected infrastructure such as the continuing landfill situation and a soaring bridge infrastructure deficit does need to be dealt with. When those projects are undertaken, taxation is the way to pay for those projects.
Considering businesses and families are still trying to recover from the COVID-19 pandemic which is now in its third year, and that the local economy will take a large hit after the impending closure of Beavers Dental, is now the time for this levy? No.