Central Manitoulin passes 4.91 mill rate increase

Draws $350,000 from reserves to balance budget

CENTRAL MANITOULIN—The Municipality of Central Manitoulin council passed its budget for 2017, and despite the best efforts of pencil sharpening by staff, a significant drop in the total assessment values in the municipality has resulted in this year’s residential mill rate rising by 4.91 percent.

“We really had hoped we could whittle it down to a zero percent like last year,” said Mayor Richard Stephens, “but in the end we had to settle for what was possible.”

The mill rate is the amount per thousand dollars of assessment that each property owner has to pony up on their tax bill.

The total operating budget for the municipality tallied in at $6.496 million, up from $6.252 million in 2016. The total budget, including operating and capital, came in at $9.9 million, but a significant slice of the capital portion of the budget is dependant on funding from the upper tier level of government.

Last year, the mill rate saw a 16.9 percent decrease, resulting in the lowest mill rate in several years.

“We had brought the mill rate down 25 percent over the last four years,” said Mayor Stephens, “so it should be taken in that context.”

One of the main culprits in this year’s rise is the drop in overall assessment experienced by the municipality. Taxes are levied on properties based on their individual values and the class of property (residential, commercial or industrial) they fall under. The mill rate rises in inverse relation to the total assessment. If total property values in a municipality drop, mill rates must rise in order to raise the same amount of money. Mill rates also rise if more money must be raised from the same total property values. Actual tax bills can vary, rising or falling, dependant on that individual property’s assessment.

“The practical impact of that drop (the total assessment in the municipality) is about $60,000 in dollar value,” supplied Mayor Stephens. That meant the mill rate would have had to rise just to raise the same amount of money as last year.

“Among the big things we have had to account for was the increase in our share of the Manitoulin Planning Board (MPB),” said Mayor Stephens. The withdrawal of the Northeast Town from the MPB resulted in a $40,000 drop in that municipality’s budget line, but it was left up to the other municipalities still in the board to make up a significant portion of that tally.

Of course, as any homeowner is all too aware, other bills don’t tend to go down. That can impact the municipality as well. “There are higher hydro costs, although I understand the province is trying to bring those increases in,” said the mayor. “It remains to be seen what that will mean.”

As to the $350,000 withdrawal from reserves, Mayor Stephens said he was not that concerned. “We do still have substantial reserves with about 1.25 to 1.5 million dollars in surplus.”

Councillor Pat MacDonald noted that it had been a difficult budget process. “We did work hard to come up with it,” she said, adding that there were compromises that had to be made. “Some of the things I thought were important had to be given up,” she said.

Councillor Derek Stephens said that although he was not happy about having to dip into reserves, “I am glad we are keeping road work and getting roads ready for next year. I am glad we went that extra bit.”

Mayor Stephens supplied that two percent of the mill rate increase was associated with road work.