2024 Budget

Peterborough, ON – The City of Peterborough 2024 Budget was adopted during the City Council meeting on Monday, December 11, 2024, outlining investments in infrastructure and municipal services, including roads, policing, Transit service improvements, municipal law enforcement, and snow removal.

Through its budget deliberations in November and December, Council made a series of recommendations to reduce the all-inclusive rate to 7%.

This has been called a course correction budget, said Councillor Andrew Beamer, Council’s Finance Committee Chair, commenting on how the City has been falling behind in terms of maintaining its roads and other infrastructure as well as providing services.

“We do need to make key strategic improvements in the community to ensure that we are not falling behind and that we are moving forward,” he said. “This has to be a one-time budget situation. This can’t become the norm. We need to work together for a more manageable budget next year."

Inflationary increases and pressures on costs necessary to maintain existing service levels as well as the growing infrastructure needs for the community featured prominently in the 2024 Budget document.

The Draft 2024 Budget that was initially presented by City staff on November 6, 2023 outlined a proposed 9.59% all-inclusive rate. Council recommended several changes to whittle the number down including, but not limited to, the following:

• Increasing the tax ratio for commercial and industrial property classes to 1.65, which would shift approximately $3 million of the net tax requirement away from the residential property tax class
• Using $1.31 million from the Legacy Fund Income Reserve – revenue generated from the investment of the principal amount received from sale of Peterborough Distribution Inc. to Hydro One
• Using $200,000 from the Casino Gaming Reserve – revenue that the City receives as a host community for a casino
• Creating a new service fee for Sewer Lateral Rodding – unplugging sanitary sewer lines – on private property at a rate of $250 during business hours and $350 during evenings and weekends, which would generate an estimated $85,000 a year in revenue
• Increasing transit fares to generate an additional $100,000 in revenue
• Deferring $150,000 from the Sherbrooke Street Reconstruction Class Environmental Assessment project and making the associated reduction to the 2024 Net Tax Levy Requirement

A 7% all-inclusive rate equates to an increase of $10.17-per-month, or $122.02 for the year, per $100,000 of property assessment for the typical residential property.

The 2024 Budget includes $359 million in operating expenses, with $171.9 million from property taxes and the remainder funded by other revenues such as grants from other governments, user fees, and service charges.

On the capital side, the 2024 Budget includes almost $128 million for 147 projects, including $10 million toward the Wastewater Treatment Plant, $9.42 million for the infrastructure project on Brealey Drive between Lansdowne and Sherbrooke streets, and $5.5 million for pavement preservation work throughout the city.

The City started the 2024 Budget process in March with community consultation, including a survey and public meetings. Council held Finance Committee meetings in May and June to review information and consider input from the community. In August, Council held meetings to hear detailed breakdowns of budget implications for services and capital projects before setting a guideline for putting together the Draft 2024 Budget.

Under the new Strong Mayor Powers, Mayor Jeff Leal presented the 2024 Budget for Council's consideration on December 11, 2023. The mayor's budget incorporated all the changes recommended by Council during its deliberations.

Budget highlights

How the municipal portion of taxes is spent (cost per $100,000 of residential assessment), estimated:

24.6% goes to external organizations, including:

• Peterborough Police Service $271.47
• Peterborough Paramedics $49.39
• Peterborough Public Health $14.23
• Fairhaven Long-Term Care $12.74
• Peterborough and the Kawarthas Economic Development $7.86
• Otonabee Conservation $6.62
• Peterborough Humane Society $3.54
• Downtown Business Improvement Area $1.37
• Greater Peterborough Innovation Cluster $1.13

23.2% goes to community services, including:

• Community Services Administration $17.48
• Arts and Culture $14.06
• Recreation and Parks $43.40
• Fire Services $147.85
• Peterborough Public Library $29.11
• Social Services $96.71

21.2% goes to capital levy to finance the City’s capital/infrastructure projects, debt payments, and other financial expenditures, including:

• Capital Financing Costs $274.25
• Property Taxation Costs $18.37
• Other Revenue and Expenditures $25.84

17.5% goes to municipal operations, including:

• Office of the Commissioner Municipal Operations $2.20
• Public Works $74.40
• Transit $105.10
• Environmental Services $62.43
• Peterborough Airport $17.93

5.5% goes to finance and corporate support services, including:

• Financial Services $17.96
• Strategic Communications and Service Peterborough $7.39
• Facilities and Property Management $15.13
• Corporate Information Services $33.77
• Emergency Management $4.47
• Materials Management $4.32

4.4% goes to infrastructure, planning and growth management, including:

• Office of Infrastructure, Planning and Growth Management Commissioner $1.82
• Engineering and Capital Works $29.98
• Asset Management and Capital Planning $16.12
• Planning, Development and Urban Design $18.51
• Building Inspection and Protective Services $0

1.8% goes to legislative services, including:

• City Clerk $8.81
• Court Services -$0.67
• Municipal Law Enforcement $10.05
• Realty Services $1.25
• Legal Services $6.85

1.3% goes to chief administrative officer activities, including:

• Office of the Chief Administrative Officer $4.90
• People and Culture $14.35

0.4% goes to City Council activities, including:

• City Council $6.73

Highlights of the 2024 Budget include:

• Increases for insurance premium costs have been substantial in recent years, rising some 113% for the City during the 2020-2024 renewal periods as market conditions responded to catastrophic worldwide natural disasters. Insurance costs are expected to increase a further 10% in 2024.
• The 2024 Capital Budget includes $2.5 million of Casino Gaming Reserve Revenue to fund a portion of the capital program.
• The 2024 Budget includes an estimated $1.5 million of investment income being earned on the Legacy Fund investments from the proceeds from the sale of Peterborough Distribution Inc. assets to Hydro One.
• The 20 largest capital projects in 2024 account for $87.6 million of the City’s overall $127.7 million capital budget.
• Investments in housing and homelessness will increase by 22.5% or $5.4 million in 2024 for a total of $29.4 million. Provincial and other sources of revenue for housing and homelessness will increase by 40% or $4.6 million in 2024, resulting in a 5.7% or $347,859 increase in the net requirement to the City. Housing and Homelessness includes support for approximately 2,000 social housing units, rent supplements, the operation of four emergency shelters and winter overnight drop-in centre.
• Peterborough Transit will add six new positions in 2024, including four transit drivers that would support increased bus frequency on busy routes as a way to improve transit service.
• The City will add five new municipal law enforcement positions as it invests in a new Municipal Law Enforcement Services Division to better respond to needs related to by-law enforcement.
• The City will add four new firefighter positions in 2024 as part of a multi-year plan to improve the depth of response for Peterborough Fire Services.
• Council will pre-commit $2.39 million in the City’s 2025 Budget to implement Phase 2 of the Bonnerworth Park redevelopment project plus $250,000 in the City’s 2025 Budget to support the initial design of active transportation and related road improvements to support Bonnerworth Park enhancements.
• The City will increase its annual contribution to the Accessibility Improvements capital project to $50,000 in 2024 from the traditional $25,000 annual funding level.
• Council will defer a $200,000 renovation to a City Hall building.
• Council will remove a $200,000 project to develop a Central Area Parking Strategy, with the funding returned to the Capital Levy Reserve fund.
• The City will implement a $50,000 graffiti management pilot program.
• Council will direct that a report be presented to the Transit Liaison Committee to consider Transit fare increases and other options.
• Increasing service grants to certain community organizations by 1.5% compared to 2023 service grant amounts, which would be an increase of $43,800 from what was included in the initial Draft 2024 Budget with the additional funding coming from the General Contingency.
• Setting aside $226,021 in Reserve for physician recruitment in 2024 until a report is considered by City Council in the first quarter of 2024 about hiring a physician recruiter.

Further details on the 2024 Budget are available at peterborough.ca/budget including the budget documents, a breakdown for each program area, and a listing of the top capital projects.

Background

Tax ratios

Tax ratios are used to determine the relationship that the industrial, commercial and multi-residential tax rates have to the residential rate. Tax ratios determine how the tax burden is shared among the property classes (i.e. industrial, commercial, multi-residential, and residential).

During previous Council terms, Councils established a program to gradually shift the tax ratios over several years with the goal to reduce the industrial and commercial tax ratios, which were 2.6 and 1.84 respectively in 2008, to 1.5 times the residential tax ratio. The 1.5 tax ratio was achieved for the industrial tax class in 2021 and for the commercial tax class in 2020.

Legacy Fund Income Reserve

The Legacy Fund Income Reserve was established from the proceeds of the sale of Peterborough Distribution Inc. to Hydro One.

The $56.7 million in principal remains unspent, with 50% earmarked for City of Peterborough Holdings Inc. for a future investment. The principal has been used for investing to earn interest on the principal.

The Legacy Fund has benefited from recent successive increases in interest rates, assisting with the generation of revenue from the principal.

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Peterborough, ON – City Council received for information the City of Peterborough Draft 2024 Budget during its Finance Committee meeting on Monday, November 6, 2023 ahead of a series of public meetings that will be held in November and December before Council considers adopting the 2024 Budget on December 11, 2023.

Draft 2024 Budget information is posted at peterborough.ca/Budget.

A public meeting with a brief presentation on the Draft Budget followed by an opportunity for residents to speak with City staff will be held from 6 p.m. to 7:30 p.m. on Thursday, November 9, 2023 at the McDonnel Street Community Centre, 577 McDonnel St.

There will be an informal drop-in opportunity to speak with City staff and the Finance Committee Chair and Vice-Chair about the Draft 2024 Budget from 4:45 p.m. to 5:45 p.m. on Tuesday, November 14, 2023 in the main foyer of City Hall, 500 George St. N.

A formal meeting of City Council’s Finance Committee will be held starting at 6 p.m. on Tuesday, November 14, 2023 in the Council Chambers at City Hall for Council to hear from registered public delegations on the Draft 2024 Budget.

Visit peterborough.ca/delegations or call 705-742-7777 ext. 1820 to register as a delegation. Registration is open until 11 a.m. on the day of the meeting.

Council will hold a series of Finance Committee meetings that are scheduled for November 20 to 23, 2023 to review, discuss and debate the contents of the Draft 2024 Budget. There are no public delegations during the Finance Committee meetings November 20 to 23. The meetings are open to the public to attend and can be watched live at peterborough.ca/WatchCouncil.

The Draft 2024 Budget outlines the City’s plan for investments in services and infrastructure next year.

The Draft 2024 Budget meets Council’s direction to draft a budget with an all-inclusive rate increase of up to 5.5%, with additional Council approved directions, external organization requests and service delivery enhancements that have been identified by Council as priorities raising the all-inclusive increase to 9.59%.

A 9.59% increase would equal a $13.92-per-month increase for $100,000 of property assessment, or $167.09 for the year.

Factors affecting the 2024 Budget above the baseline 5.5%, which is largely based on inflationary cost increases, include proposed investments in policing, City employee compensation, Transit service improvements, enhancing municipal law enforcement services, changes to snow removal operations, and improving customer service.

The Draft 2024 Budget includes a number of cuts to spending, increase in revenue estimates and use of reserves to reduce operating expenses by $2.5 million, partially offsetting the increases in other areas. The tax requirement for the capital budget was reduced by $11.9 million by delaying projects until future years, reducing investments in capital programs such as sidewalk installations, and the use of reserves.

The Draft 2024 Budget includes $359 million in operating expenses, with $173.9 million from property taxes and the remainder funded by other revenues such as grants from other governments, user fees, and service charges.

On the capital side, the Draft 2024 Budget includes $128.2 million for 147 projects.

The City started the 2024 Budget process in March with community consultation, including a survey and public meetings. Council held Finance Committee meetings in May and June to review information and consider input from the community. In August, Council held meetings to hear detailed breakdowns of budget implications for services and capital projects before setting a guideline for putting together the Draft 2024 Budget.

Upcoming public meetings on the Draft 2024 Budget

• Public meeting, brief presentation and opportunity to ask questions, 6 p.m. to 7:30 p.m., Thursday, November 9, 2023, at McDonnel Street Community Centre, 577 McDonnel St.
• Informal drop-in opportunity, 4:45 p.m. to 5:45 p.m., Tuesday, November 14, in the main foyer, at City Hall, 500 George St. N.
• Finance Committee meeting, registered delegations presenting to Council, starting at 6 p.m., Tuesday, November 14, at City Hall, 500 George St. N.
• Finance Committee meetings, presentations from invited local boards and agencies, no public delegations, Wednesday, November 15, at City Hall, 500 George St. N.
• Finance Committee review, discussion and debate on the Draft 2024 Budget, no public delegations, scheduled for November 20 to 23, 2023, at City Hall, 500 George St. N.
• City Council considers approval of 2024 Budget, registered delegations can present to Council, Monday, December 11, 2023.

2024 Preliminary Budget Guideline

In June 2023, Council approved requesting presentations from department Commissioners in August on options for a 3%, 5.59% and 7% Guideline for each of their departments, which is a new, additional step in the budget process to present additional options for Council's consideration.

Setting the 2024 Budget Guideline gives direction to the City on putting together the Draft 2024 Budget, which is then reviewed by Council prior to considering approval of the final document toward the end of the year.

Consultation on the 2024 Budget was conducted through two drop-in style sessions that were part of a community engagement approach that also included a survey and the traditional interaction between Council, City staff and the community that takes place outside of organized consultation.

The current draft 2024 Budget Guideline information reflects that the current estimate for setting the 2024 Budget to maintain current levels of service and meet previously approved directions from Council would require an all-inclusive rate increase of 5.59% in 2024, which would add $97.45, or $8.12 per month, per $100,000 of assessment for residential properties.

Factors related to the potential increase include employee compensation, annualization of new police hires in 2023, general inflationary costs, insurance costs, fuel prices, the new Green Bin service (source separated organics collection and composting) and the Transit budget.

Personnel costs are a major component of the operating budget. Contracts for ATU L169, CUPE L126, CUPE L504, and CUPE L1833 are currently under negotiation. Contract increase placeholders have been built into the budget to facilitate the budget process. As contracts are settled the contract rates will be incorporated into the budget.

Next steps:

• August, date to be determined - Finance Committee meeting to consider 2024 Budget Guideline
• August/September, date to be determined - City Council considers approving 2024 Budget Guideline
• November 6 - Draft 2024 Budget presented to Finance Committee
• November 9 and 14 - Public engagement drop-in sessions
• November 14 - Public meeting on Draft 2024 Budget
• November 15 - Outside organizations attend Finance Committee Budget deliberations
• November 20 to 23 - Finance Committee deliberates on the Draft 2024 Budget
• December 11 - City Council considers approving the 2024 Budget

The City engages with residents each year as it prepares the draft budget for Council’s consideration. The City consults with the community throughout the budget process – at the beginning when setting the guideline, when the draft budget is released, and before Council considers approving the budget.

The annual budget survey is one way the City engages with residents alongside other consultation opportunities, including public meetings and interactions between the community and Council and City staff through in-person conversations, phone calls and emails. Input from the community engagement is considered with other budget inputs such as legislated requirements and financial pressures.

The budget survey is a consultation tool – a way for residents to provide their opinions and comments for Council’s consideration. To reduce barriers and to encourage participation in the survey, registration was not required. It is not a scientific sample survey that is statistically defensible. It does not necessarily reflect the opinion of the population. The survey should be considered as a feedback tool that assists the conversations around budget priorities, City services, levers the City can use to pay for municipal services, and service level expectations.

The budget survey was open from March 28 to April 21, 2023. The survey offered broad, high-level topics and questions as one way for residents to engage in the budget process at this early stage of drafting the budget. There were 415 responses to the survey, up from 274 in 2022.

The survey was hosted on the City’s online community engagement platform, Connect Peterborough, at connectptbo.ca. To date, there have been approximately 1,200 visits to the 2024 Budget project page, with about 450 visits arriving from direct traffic from people who entered the website address, about 640 from social media links, about 85 from referrals from other sites, and about 30 from search engines. Hard copies of survey were available upon request and were available at the in-person, drop-in meetings held on April 13 and 21, 2023.

The budget survey and budget drop-in meetings were promoted through local media with coverage through television, radio, newspaper and online news outlets as well as on social media and through the City’s website.

Survey participants were asked how much they value various municipal service groups using a scale of very important, important, moderately important, slightly important and not important. Results showed that across all categories respondents find municipal services to be important, with the following categories receiving the highest number of Very important responses.

• Enabling affordable housing
• Social services
• Sewers, water, stormwater management
• Fire prevention, police, paramedics
• Environment protection, support for green projects

When asked to rank a list of issues, the average rankings placed the options in the following order:

1. Housing/accommodations
2. Social issues
3. Health/public health
4. Cost of living
5. Physician recruitment
6. Environment/climate change/sustainability
7. Economy/jobs/economic issues
8. Health and vitality of the downtown
9. Arts, culture and heritage
10. Infrastructure/transportation
11. Crime/criminal activity
12. Governance and transparency
13. Provision of recreation facilities

Participants were asked to consider some of the broad tools that the City has available for balancing its budget, as required by law. They could select multiple options (previous year’s response in brackets).

• Introduce new user fees for some City services that currently have no fees – 49.2% (54%)
• Increase user fees for City services that currently have fees – 48.5% (47%)
• Increase property taxes – 40.4% (30%)
• Reduce service levels – 34.6% (38%)

Respondents indicated what they think the property tax change should be in 2023 based on their expectation for infrastructure and service levels. Based on the information available at the time, assumptions were made on what each option meant in terms of increasing, maintaining, or decreasing service levels to help inform the selection by participants.

• Generally, maintain existing levels of service, 3.5% increase – 27.5%
• Increase investments in infrastructure/services, 3.6% to 4% increase – 22.7%
• Reductions in services and infrastructure when accounting for inflationary increases, 1% to 3.4% increase – 14.9%
• Greater investments in infrastructure/services, greater than 4% increase – 10.9%
• Other (please specify) – 10.9%
• Substantially reduce services and infrastructure maintenance, 0% increase – 8.6%
• Drastically reduce services and investments in infrastructure, decrease property taxes – 4.5%

Outside of the specific questions in the survey, the survey included several opportunities for respondents to provide other comments on the budget. Respondents provided comments on topics such as the cost of living/inflation, housing, addictions, mental health issues, setting strategic goals for the City, the health of the downtown, reducing City expenses, finding efficiencies, maintaining infrastructure, police services, transit, roads, the environment and nature areas.

In addition to the Budget Survey, the Finance Chair and Vice Chair along with Council members hosted two casual drop-in style meetings and April 13 and 20 for residents to share their comments and ideas as an alternative to the more formal consultation option provided by appearing as a delegation at a Council meeting. About 30 people attended the two meetings. New to the budget process this year, the Finance Chair and Vice Chair will also be hosting two drop-in meetings after the Draft 2024 Budget is released to provide another opportunity for conversations and questions when the details of the draft budget are available.

Attendees at the two drop-in meetings in April spoke about priorities road conditions, sidewalks, cycling infrastructure, the trail network, arts funding, arts grants process, housing, homelessness, climate change, a social innovation centre for marginalized people, empowering marginalized people, the economy, and the downtown.

Summaries of survey questions are posted on the 2024 Budget project page:

• Municipal service importance
• Service delivery
• Issues facing the City
• Options for balancing the budget
• Property tax changes
• Where did you hear about the survey
• Familiarity with the budget
• Interest in the budget process
• Ways to engage with residents

Survey participants were asked how much they value various municipal service groups using a scale of very important, important, moderately important, slightly important and not important. Results showed that across all categories respondents find municipal services to be important, with the following categories receiving the highest number of Very important responses.

• Enabling affordable housing
• Social services
• Sewers, water, stormwater management
• Fire prevention, police, paramedics
• Environment protection, support for green projects

  
  

  

Survey participants were asked to rate municipal services based on how well they think the municipally-funded services are being delivered by indicating their response using the following scale: very satisfied, satisfied, neutral/neither satisfied nor dissatisfied, dissatisfied, and very dissatisfied. The following categories received the most very satisfied and satisfied responses:

• Garbage and landfill
• Sewers, water, stormwater management
• Recycling
• Fire prevention, police, paramedics
• Providing access to recreation facilities and delivering recreational programming

Participants were asked from their perspective, and recognizing that not everything is within City control, what are the most important local issues facing the City at the present time (On a scale of 1-13, with 1 being the most important)? The average rankings placed the options in the following order (average rank for each option in brackets):

1. Housing/accommodations (4.3)
2. Social issues (4.79)
3. Health/public health (5.49)
4. Cost of living (5.75)
5. Physician recruitment (5.97)
6. Environment/climate change/sustainability (6.92)
7. Economy/jobs/economic issues (7.33)
8. Health and vitality of the downtown (7.35)
9. Arts, culture and heritage (7.49)
10. Infrastructure/transportation (7.52)
11. Crime/criminal activity (7.56)
12. Governance and transparency (9.48)
13. Provision of recreation facilities (9.91)

Participants were asked the following question:

To balance the 2024 Budget as required by law, the City of Peterborough has a number of options to consider. Which of the following options would you prefer the City use to balance its budget? (Note: User fees are monies you would pay to the City to access specific services, facilities and utilities, such as licences, permits for using City-owned facilities such as arenas and recreation centres, and sewer surcharge for stormwater management.) Please select all options that you think should be used. You can select multiple options.

Summary of responses:

• Introduce new user fees for some City services that currently have no fees – 49.2%, 195 responses
• Increase user fees for City services that currently have fees – 48.5%, 192 responses
• Increase property taxes – 40.4%, 160 responses
• Reduce service levels – 34.6%, 137 responses
• Other – 24.2%, 96 responses

Respondents indicated what they think the property tax change should be in 2023 based on their expectation for infrastructure and service levels. Based on the information available at the time, assumptions were made on what each option meant in terms of increasing, maintaining, or decreasing service levels to help inform the selection by participants.

• Generally, maintain existing levels of service, 3.5% increase – 27.5%
• Increase investments in infrastructure/services, 3.6% to 4% increase – 22.7%
• Reductions in services and infrastructure when accounting for inflationary increases, 1% to 3.4% increase – 14.9%
• Greater investments in infrastructure/services, greater than 4% increase – 10.9%
• Other (please specify) – 10.9%
• Substantially reduce services and infrastructure maintenance, 0% increase – 8.6%
• Drastically reduce services and investments in infrastructure, decrease property taxes – 4.5%

“Other” responses included suggestions such as increasing development charges, charging tolls for use of roads, comments on the residential tax rate level, City staffing levels, and finding efficiencies.

Participants were asked a series of voluntary questions about their knowledge of the budget process, how they found out about the budget consultation, how they prefer to get information about the budget, and demographic information to help inform how the City engages with the community about the budget.

How did you find out about the 2024 Budget survey?