CORNWALL, Ontario - The city has managed to keep pace with inflation when it comes to potential tax increases in Cornwall - thanks to funding being provided by senior government programs.
A recent report completed by the city finance department suggests that over the last eight years municipal taxes have jumped by nearly 13 per cent - which resulted in an extra $273 being shelled out by property owners.
But, over that same time if one were to use the inflation rate instead, taxes would have jumped by 14 per cent, or $307.
It has left some councillors wondering how the city can continue to remain in the black if inflationary costs are not being met with the same increase in revenue via taxpayers.
The answer, it would seem, comes from a drop in the amount of money the city spends on capital projects like street and sewer repairs, that are funded by the tax base, said city finance manager Maureen Adams.
"We're doing less on the capital side. We're not investing as much into our capital as we used to," she told city councillors at a recent budget meeting.
This year the tax base will cover about $1.5 million worth of capital projects - with another $4.2 million being paid for by gax tax payments from senior levels of government, for a total of close to $5.7 million.
In 2013 the entire capital project budget, which totalled $5.2 million, was funded solely from the tax base.
Gas tax funding pays for repairs to city streets.
"If we didn't have that our streets would be in dire shape," said Adams.
Despite the fact that tax hikes appear to be less than inflation increases, Coun. Elaine MacDonald has voiced concern.
"It's not magic we can get more for less," she said, pointing to worries about rising costs to the corporation via salaries and the like. "We're down kind of a dangerous path. We don’t storm the grocery store when the price of bread goes up. We just kind of accept it.
"If we're not keeping pace with inflation, I kind of feel a little bit alarmed."
City council has made it clear in the past that it wants to be able to argue that if a tax hike is warranted, it will keep pace with inflation.
Taxpayers will be on the hook for around $1.5 million in capital projects this year, which includes items like HVAC replacement, vehicle leasing, playground structure construction and the like.