Heather Wright/The Independent

Petrolia residents will be paying three per cent more for their municipal taxes, despite the efforts of one municipal councillor to give them a break.

Town council completed budget talks Nov. 26. It included that three per cent tax increase – about $97 more for the average home assessed at $194,000. 

One of the big drivers of the increase was the cost of policing. The town’s 2025 OPP contract increased 21.4 per cent – about $240,000 more than 2024 – boosting the cost of policing over $1 million.

Three days later, the province announced it would spend $77 million to help rural communities pay for the increasing costs which were spawned by a new contract the province struck with the OPP Association.

 In Petrolia, that announcement is expected to bring in another $206,2020 in revenue.

When the 2025 draft budget came to the council table Monday, Councillor Chad Hyatt wondered why that money wasn’t factored into the document.

“I’m just curious on why we chose not to include any of the Ontario OPP offsetting updates in this budget,” he asked

Mayor Brad Loosley responded “Until we get something in writing and the cheque has come, we’ll deal with it then.”

Hyatt pressed the matter. “I think we’re putting $1.4-something million into reserves, but this $200,000 you’re getting up to 1.6 million in reserves (in 2025). So I thought it would be good to give some of that back to the community.”

Hyatt calculates the $200,000 OPP relief funding should reduce the bottom line by 2.2 or 2.3 per cent. “I thought that we should align our tax rate with that.”

Loosley argued against the move saying “what they told me over the phone, I’m hoping it will be what we get.”

“Do we with the province is not going to come out with this money,” Hyatt asked. “there are 300 municipalities all over this province expecting this money, do we think the province is going to say ‘Sorry, were just going to forget it?’”

No, Loosley said. “It’s like applying for a grant and putting it in and we don’t get it…I’m just going to wait until we get it.”

But Hyatt tried anyway, asking council members to approve the budget with a two per cent tax increase increase instead of the three which council approved during budget deliberations. No one on council agreed.

He tried again, asking to adopt a budget with a 2.25 per cent increase. Still no takers.

Hyatt asked again with a 2.5 per cent tax again with no support from other council members.

Loosley said it was time to move on and deal with the OPP relief money when the province handed over the money.

“So we’re going to approve the taxes now and we can amend the taxes at a later date,” Hyatt asked.

“No, no,” replied Loosley adding “we’re approving it as is.”

But Hyatt made one more attempt, asking fellow councillors to pass a budget with a 2.75 per cent increase instead of three.

Councillor Bill Clark noted the town used reserve money for some projects in the 2025 budget – about $250,000 in all for roads and sidewalks – and added “if we are successfully getting money returned to us from the province,  we should put it back into the reserves for when we do really need it.”

CAO Rick Charlebois added that since the draft budget was approve “another significant expense” has come in and it will be dealt with in January. He added “stuff happens every day, up and down” in agree that the money should be sent to reserves.

Hyatt disagreed.

“Every year we seem to run a surplus…we seem to run one, two, three per cent higher for annual surplus on top of the $1.4 million in reserves,” he said. “I still think there is some financial room to offer a tax break to the residents.”

Council did not agree, also turning down Hyatt’s proposal for 2.75 per cent tax increase instead of three.

Hyatt admits he was a bit surprise no one on council agreed with lowering taxes in the wake of the provincial funding. “I thought I have a few takers – someone to join in.”

Council then voted to approve the budget, complete with a three per cent tax increase.

The town will bring in $9,089,763 in revenue about 3.2 per cent more than last year without the OPP relief grant from the province. 

It plans to spend $6,817,297, about five per cent more than last year.
If the town follows through on the financial plan, it will put $1,491,297 into the working capital reserve, for capital projects. That fund at $2,968,520 at the end of 2023. The town expects to put another $1,277,935 at the end of this year.

In all, at the end of 2022, the town had reserves of almost $7.2 million and about $6.9 million at the end of 2023.

This isn’t the first time extra provincial funding came after the draft budget was approved.

In 2021, a planned two per cent tax increase was eliminated when the CAO said the Ontario Community Infrastructure Fund grant was about $500,000 more than expected after council had finished budget deliberation. That was applied to the budget and there wasn’t a tax increase that year.