GUELPH – Wellington County officials are pondering annual tax increases – over and above what has already been planned and possibly for as long as a decade – to help address an $81-million “gap” in funding for infrastructure projects.
At a May 29 county council meeting, Hemson Consulting Limited associate partner Andrew Mirabella presented an amended asset management plan that includes key requirements set by the province.
The plan details all municipal infrastructure assets; identifies proposed levels of services for each of the next 10 years; outlines lifecycle activities required to meet proposed levels of service and the risks/costs associated with lifecycle activities.
Mirabella explained the county has a value of $1.7 billion in assets, which are in good condition overall and have a replacement value of $15,800 per capita.
Roads, bridges and culverts represent over 50 per cent of the $1.7 billion.
“What’s interesting when you look at the revenues versus the cost, is we have sufficient funding to address all our future needs, it’s just … the funding capital relates to the backlog which we are trying to address over the long-term,” Mirabella said.
He offered council two options to address the $81-million funding gap.
“If we were to spread that gap over a 10-year period it’s about $8.1 million per year that needs to be addressed,” he said.
Option one proposes closing the gap over the next decade, with a 1.25 per cent tax levy impact each year.
Option two would close the gap over five years with a 1.62% tax levy increase each year.
Mirabella stated there is one unknown, as no one knows how inflation will track over the next few years.
“The county would have to adjust the gap in terms of the real-term tax levy impacts, plus any inflation or impacts that would arrive on top of that,” he said.
“Generally speaking, the gap is certainly a manageable number and it’s addressing … more of the infrastructure backlog.”
“It’s really a testament to a lot of the good work that the county has done thus far in trying to be pro-active in your asset management program,” Mirabella continued.
Warden Chris White told council, “This is just for information today.
“This will become a part of the bigger budget decision later in the year.”
Council also looked at the total 10-year lifecycle funding at current levels for tax-funded services.
Lifecycle activities include:
- non-infrastructure solutions;
- expansion activities;
- maintenance activities;
- renewal/rehabilitation activities;
- replacement act; and
- disposal activities.
Just under $965 million in funding is available for capital replacements and repairs, operations and maintenance and expansion from 2025 to 2034.
The assumed revenues are largely based on confirmed funding.
Mirabella finished by sharing strategies to adjust the gap moving forward, including:
- continue to seek funding support from upper levels of government;
- monitor levels of service measures in conjunction with financial strategy;
- project co-ordination;
- increased investment in infrastructure;
- improve data quality; and
- advancing risk model.
