Niagara-on-the-Lake passes 6.75% operating budget increase—highest of region’s lower-tier municipalities

With the March 26th Council approval, Niagara-on-the-Lake became the last of Niagara’s thirteen municipalities to approve its 2024 operating budget. The $48.5 million represents an increase of just over $1 million from the 2023 Operating Budget—or 6.75 percent—taking into account assessment growth.

For the average homeowner with a property assessed at $544,000, the increase amounts to an additional $89.63 on the tax bill, with a further $1.21 for those within the urban area who receive a stormwater levy charge.

“Town Council thoroughly discussed the Capital and Operating Budgets, aiming to address residents' needs and preferences, budgets are a reflection of community priorities,” Mayor Gary Zalepa stated in a press release. “Acknowledging the impact of inflationary increases and infrastructure investment, Council believes it has balanced financial sustainability and community benefit.”

West Lincoln approved a 6.55 percent increase and St. Catharines saw its lower-tier share go up by 1.78 percent. The upper tier regional municipality of Niagara approved its budget with an increase of $38.6 million in 2024 amounting to a 7.02 percent property tax increase on the Regional portion of the bill, which is approximately 40 percent of the overall property tax bill, on average, for homeowners across Niagara (the lower-tier portion, on average, represents about 40 percent as well, and the provincial education portion makes up the remaining 20 percent, approximately).

Average tax increases resulting from the Niagara-on-the-Lake approved 2024 budget.

(Niagara-on-the-Lake)

With the Bank of Canada’s 2023 annual rate of inflation at 3.9 percent, a half dozen of Niagara’s municipalities (St. Catharines, Welland, Lincoln, Thorold, Port Colborne and Pelham) had levy increases below that rate. Niagara Falls Council, perhaps chastened by public criticism over its 2023 increase of 7.9 percent, approved a 3.95 percent increase for 2024. 

Ultimately, the municipal operating levy is just one component of the total of a resident’s property tax bill, which also includes the local capital budget increase, the overall Regional levy (capital and operating combined), the provincial education levy for school boards and, often, special levies, for example, to help pay for a new hospital, another particular piece of infrastructure or to cover general infrastructure needs outside the base budget. 

A breakdown of spending in the Niagara-on-the-Lake capital budget. 

(Niagara-on-the-Lake)

In 2023, while the municipal tax levy increase in St. Catharines was a modest 1.07 percent, with the Regional portion of the bill increased due to the uploading of transit services, St. Catharines residents’ tax bills rose by 10.5 percent, triggering a backlash. This year, as per a media release from the City of St. Catharines, with the Region and education levies, the total property tax bill for the average homeowner will rise 3.83 percent or $160.56 for a house with the average assessed value, for the year.

The input of the public in the budget process varied from municipality to municipality. For most, public outreach consisted solely of a survey on the municipality’s website. Niagara Region staff had promised a robust public engagement but their survey and series of focus groups did not occur until the Council was well underway in their budget process. St. Catharines had the most extensive budget engagement, with two public open houses, a telephone town hall, kiosks throughout the community and an on-line survey.     

Like many municipalities, the first discussion of the 2024 budget at Niagara-on-the-Lake Council occurred mid-summer 2023. Staff had prepared a report setting out a schedule for the Budget Review Committee, made up of the entire Council. The budget meetings commenced in September, with a hoped for approval of budgets in December.

At the time of the summer meeting, staff asked for Council’s endorsement of their plan to work toward an operating levy increase not exceeding 6.5 percent. Councillor Nick Ruller asked whether the proposed limit was sufficient. Treasurer and Director of Corporate Services Kyle Freeborn responded that even with a 6.5 percent increase, the operating budget would be best described as a “maintenance” budget, one that would maintain existing service levels. A motion, moved by Councillor Sandra O’Connor, was passed that also directed staff to prepare a budget with a lower levy increase limit of three percent.  

When deliberations began in earnest in the fall of 2023, staff outlined such budget pressures as inflation, insurance increases, and the still-to-be-finalized employee bargaining agreement. As a result, staff recommended against the three percent increase option, outlining that such an increase could only be achieved through service level cuts.  

Staff also advised that the proposed budget with a 6.5 percent increase did not include 20 “business cases” for proposed new staff hires and contract conversions, along with some studies and transfers to reserves. If approved, the business cases would add 14.5 percent to the levy.  

At a Budget Committee meeting in November, the Council members approved six of the business cases adding the positions of Fleet Mechanic, Climate Change Coordinator, Senior Planner - Policy, Municipal By-Law Policy Coordinator, By-law Officer and a Recreation Program Assistant. At a subsequent meeting, the Lord Mayor defended the additions, arguing that the municipality needed to be “properly resourced”.  In addition, five contract positions were converted to full-time and the employee bargaining group wage adjustments were finalized.

December and January passed without meetings of the Budget Review Committee but during that time period two of the five members of the Town’s Senior Management Team, Chief Administrative Officer Marnie Cluckie and Director of Operations, Rome D’Angelo, left the Town for other employment opportunities in Hamilton.

When the Budget Committee reconvened on February 29th a number of mitigation measures were approved.  The measures included budgeting the six new hires at 50 percent for 2024 to align with expected recruitment timelines, reducing line items to align with historical actuals, deferral of the reduction in transit funding subsidy from the parking reserve, and the use of a number of one-time reserve transfers.  With the mitigation measures, the municipal tax levy increase rested at 6.75 percent, a quarter of a percent higher than what staff had committed to back in July. 

One matter that unexpectedly came up at the February budget committee was a motion by Councillor Maria Mavridis to increase councillors’ wages by an additional 2.4 percent, for a total increase of 4.9 percent. It was explained at the meeting that the Town has a policy in place that council wage increases are tied to the lower number of a Consumer Price Index category and any negotiated wage settlement. As a result, Niagara-on-the-Lake councillors were already scheduled to receive a 2.5 percent increase in 2024.  

Councillor Wendy Cheropita seconded the motion calling it “brave” and arguing that the Niagara-on-the-Lake members were paid lower than most of their comparable colleagues. Lord Mayor Zalepa asserted that while he had no issue with a “review through a holistic process”, he could not support such a motion being brought up “on the floor of a committee budget meeting.” The motion was defeated.

The approval of the operating budget was then brought forward at a Special Council meeting on March 26th. The related staff report noted that Town Staff and Council had met ten times to discuss and deliberate over the budget, totalling 30 hours of public meetings.  

The Council received a presentation from Chamber of Commerce and NOTL Tourism President and CEO Minerva Ward requesting $67,935 for a number of community events that her organization has undertaken over the years.  The request was an approximate $8 thousand increase from funding Council had approved in 2023, however, since that time monies flowing from the MAT (Municipal Accommodation) Tax have been remitted to NOTL Tourism. As a result, Councillor O’Connor had a motion that she had proposed at the prior Budget Committee Meeting “that the Town does not fund Tourism NOTL because they receive 50 percent MAT for such activities.”

Councillor O’Connor’s motion was unanimously approved, which was quickly followed by a motion finally putting Niagara-on-the-Lake’s 2024 operating budget to bed.

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