York Region homeowners could see approximately $105 added to their tax bills this year if regional council approves a staff proposal for a 3.9 per cent increase.
The proposed increase, which was pitched to council today, would add $105 to the average property tax bill, or about $84 for the average Newmarket home. The increase includes a 2.9 per cent tax rate increase, plus a one per cent tax levy to help fund the Yonge-North subway extension.
The budget is facing higher inflationary pressure than in other years, along with the pressures of projected population growth, commissioner of finance and regional treasurer Laura Mirabella said.
“The 2023 proposed budget delivers on the region’s key priorities," Mirabella said. “It supports the region's continued response and recovery from COVID-19 while addressing the very real fiscal challenges of inflation, demographic changes, and legislative and regulatory changes.”
The budget still has two weeks of upcoming review by council for potential changes before it is finalized. This increase does not include other parts of the property tax bill, such as the Town of Newmarket additional portion.
The increase is partly driven by the region’s plans to fund a portion of the Yonge-North subway extension. It decided last term to include a dedicated tax levy of one per cent for future years. The levy will fund approximately 20 per cent of the $5.6-billion project.
Inflation was also cited, with the municipal price index above four per cent in 2022 versus between one and three per cent in previous years.
But the 2.96 per cent tax increase could have been bigger. Staff proposes to skip an asset management reserve transfer this year, taking 1.16 per cent off the tax increase. Mirabella said this decision was made to reduce the tax increase.
That garnered some concern from Newmarket Mayor John Taylor and others.
The region is “buying down our tax rate,” Taylor said. “We got to find balance, and we got to respect the taxpayer, but there’s risk involved in all these decisions.”
Georgina Mayor Margaret Quirk said that reserve loss will have to be made up in future years if it goes ahead.
“It will require some deeper thought,” she said.
The budget preview did offer insight into what the region’s tax rate increase in future years could be. Staff project further increases by 3.75 per cent in 2024 and 3.6 per cent in 2025 and 2026.
But none of that includes the impact of provincial Bill 23, which municipalities have said will force tax increases due to a loss of development charge revenue. Mirabella said it remains to be determined how the province might balance that with funding, but the loss of development charges could range between five and 16 per cent, amounting to a shortfall between $497 million and $1.57 billion.
Richmond Hill Mayor David West said he does not think the province wants to see massive tax increases attributed to its legislation.
“When the rubber meets the road,” West said, “we make it very clear what’s going to happen.”
Regional council will have two dedicated committee meetings on the budget over the next two weeks, Feb. 2 and Feb 9. Budget approval is scheduled for Feb. 23.