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ISSUES: Newmarket bracing for inflation squeeze on budget

Poll shows tax rate top issue in election, mayor says town likely to avoid service cuts
money inflation
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Issues is a series of articles exploring top issues impacting the town and the 2022 Newmarket municipal election, talking with experts and local candidates about their perspectives.

Newmarket is bracing for a challenging budget pressured by inflation as residents rate fiscal management and taxes as a top issue.

Nearly half of respondents to a NewmarketToday poll rated taxes and fiscal management as the top issue for them in the upcoming municipal election. With the election year, the town pushes back its budget process and aims to pass it in the first quarter of 2023 versus the end of the calendar year. 

Newmarket Mayor John Taylor said all towns and governments are dealing with inflationary pressures and it is something with which the new council will have to quickly engage.

“We’ll have to roll up our sleeves,” he said. “It’s apparent to anybody in private or public sector, there’s going to be pressure.”

The 2022 budget saw a 1.99 per cent municipal tax increase on Newmarket’s side. Tax rate increases on the town end have hovered between two and three per cent in the past term, with a 2.95 per cent increase in 2019, a 2.24 per cent rise for 2020 and 1.98 per cent for 2021. These exclude the regional and educational portions of the property tax rate.

The town has boasted about keeping its tax rate about 10 per cent below the GTA average. Newmarket was in the top-10 lowest for 2021 property tax rate according to an analysis of Ontario cities by real-estate brokerage Zoocasa.

Still, Newmarket residents are feeling the sting of affordability under inflation, with the annual rate at around seven per cent in August. Deputy Mayor Tom Vegh said it has been the No. 1 issue he is hearing about during the campaign.

“Everybody knows that inflation is huge,” he said. “Everybody felt it — grocery bills, back-to-school shopping. They’re worried that ‘oh my God, inflation affects the municipality also.’ We’re not immune to that.” 

The town said it is too soon to say what direction the budget might take.  

“Like all municipalities, we will be facing the significant challenges of inflation. It’s a bit too early to provide a detailed outlook,” the municipality said. “The full budget package, including any information on remuneration, will come forward to the new council following the election.”

But despite the pressure, Taylor said he does not believe there is a public desire for any service cuts.

“I go into every budget trying to reflect on what I believe is the majority will of the public,” he said. “The town in general would like to see service levels maintained … Right now, I don’t think service cuts are on the menu yet, but we’ll see where the budget takes us. The goals would be to maintain our service levels.” 

He suggested the town may instead need to be looking at its capital budget timelines instead. 

“It goes to the council table,” he said. “They always bring in various options and ideas and concepts for addressing the impact. Honestly, it's a little early to say where it’s going to go.”