Owen Sound is advocating for a review of the provincial-municipal fiscal framework.
Mayor Ian Boddy was part of a delegation from Owen Sound that met with Minister of Finance Peter Bethlenfalvy at the 2024 Rural Ontario Municipality Association (ROMA) annual conference.
Boddy said the city joins calls from almost all Ontario Municipalities for a Social and Economic Prosperity Review, which he said is long overdue.
"We met with the minister and what we discussed is the fact that it's the municipal financial plan with the province, I think was done in 2008. And it set a term to 2018. And so it needs to be updated," explained Boddy. "From our point of view, being somewhat of a small city, but a regional city, we can face costs like court security, and other things that really covers the whole region, but it's the city that's carrying it."
The City has budgeted approximately $400,000 for net court security costs this year, a service that could be paid for by the province with a new funding model. Boddy pointed out the city covers a disproportionate share of costs related to core infrastructure and social infrastructure as a regional hub.
"Recreation costs that we're providing to the whole area that just the city's carrying," he added. "Those are the types of things that we discussed with him. And looking at a potential new model for provincial and municipal finances."
He added other areas of concern include stable funding and timelines for grants, physician recruitment, and insurance costs. He said the finance minister pointed to grants the city already receives.
"He actually pointed out the OMPF grants that we get some of the other grants that we're receiving already and that they've gone up and rightly so. We appreciate them," he continued. "But there's still a lot of things that fall through the cracks that are missing."
Boddy said there needs to be a new fiscal framework that recognizes and reflects the scale and scope of municipal service delivery today, because property taxpayers, including small business owners and seniors on fixed incomes, can’t afford to keep paying provincial costs.
"The Federation of Canadian municipalities points out that only nine cents of every tax dollar collected was collected through property taxes and goes to municipalities," explained Boddy. "So the other 91 cents is going through income tax sales taxes to the federal and provincial level that that we're not seeing and we're bearing most of the infrastructure costs."
The delegation told the minister that major investment in essential municipal infrastructure is required to achieve the province’s ambitious target of building 1.5 million new homes by 2031. However, Bill 23 created a $1 billion annual hole in municipalities’ ability to fund this foundational new infrastructure that will help our province grow.
"Municipalities continue to subsidize the provincial treasury by almost $4 billion each year by paying for provincial responsibilities such as social housing, long-term care, public health, childcare, and social services," according to a statement from the city. "Ontario’s property taxes are already the second highest in the country, while provincial spending per capita is the lowest in Canada."
The City of Owen Sound invests $42 million in providing services annually to the community.
