Property tax cuts should average five to 10 percent across the province by the year 2000 through the provincial-municipal swap of services, Municipal Affairs and Housing minister Al Leach pledged last week.
But others are calling that statement false, accusing the government of merely “passing the buck” to municipalities.
Terry Mundell, president of the Association of Municipalities of Ontario, charged the province was being “irresponsible” to suggest that kind of tax cut—especially since municipalities have little or no control over what’s being passed down.
He stressed AMO, along with municipal members of the transition teams, have not signed off on the figures released by the ministry.
What Leach’s announcement last week failed to take into account, he added, was the loss of $667 million in grants and the $225 million annual bill once provincial highways are transferred over to municipalities.
Mundell claimed municipalities would have to find about $900 million in annual savings just to avoid tax increases.
“It’s not going to be cost-neutral. There’s no way,” echoed NDP leader Howard Hampton, stressing taxpayers will have to pay, on average, an additional 25 percent on property taxes—or face cuts to services—to deal with the changes.
“I have said from the beginning that what the province intends to do is they’re going to put municipal councils in the position of being the bad guys,” he fumed.
The provincial Liberals were more conservative in their estimates, claiming the downloading would mean about a five percent hike in local property tax.
“This government’s plan goes against what everyone is saying about downloading, including David Crombie, who chaired the ‘Who Does What’ panel,” said John Gerretsen, the Liberal critic for municipal affairs.
Hampton felt rural Ontario would be hit harder hit, predicting any increase would be double or triple the average.
But Noble Villeneuve, minister of agriculture, food and rural affairs, argued downloading would mean a better opportunity to tailor services at a lower cost to rural taxpayers.
“The ‘Who Does What’ initiative will reduce costs for northern taxpayers as we provide the tools for northerners to make local decisions about local efficiencies,” noted Chris Hodgson, minister of northern development and mines.
Still coming are details on the allocation of the $500 million Community Reinvestment Fund, the $70 million in additional Transition Assistance, or the $800 million Municipal Capital and Operating Fund.