Blood on the table — city ‘agglo’ taxes set to soar

By P.A. Sévigny

Prior to last month when the Tremblay administration finally revealed its new budget for 2010, the island’s suburban mayors already knew their cities were in for some very bad news. As of last week, the news only got worse. Unless the Charest government does something about

Montreal’s finances, both the city and its suburbs can expect more tax hikes in their not too distant future.

“At this point, we’re looking at a six percent increase in taxes for residential properties and up to an 11 percent increase for commercial and industrial properties,” said TMR mayor Vera Danyluk. “Frankly speaking, there’s not much we can do about it.”

As for Westmount’s new budget, city councillor Tim Price, the city’s finance commissioner, was forced to wait until the last week of January before releasing his own figures which demonstrate how the owners of an average single-family dwelling can expect an increase of at least eight to nine percent over last year’s taxes. In his presentation, Price told the city council the tax hike was due to a 12.5 percent increase in the city’s agglomeration fees for regional services which adds up to $5 million more due as compared to last year’s fees.

“This increase in Westmount’s contribution is completely unacceptable, given the rates of inflation, our current economic situation and the reality of our city,” said Price.

As the president of the island’s Association of Suburban Mayors (ASM), Westmont Mayor Peter Trent prepared the ASM’s minority report in which he singles out nine serious points for future discussions with the central city authorities. As a successful businessman, Trent still can’t understand why the city’s budget process fails to reflect any concrete objectives nor does it display any kind of coherent guidelines for future projects or possible emergencies. During the recent municipal elections, the report cites how Mayor Tremblay often said the city’s future tax hikes would only reflect regular inflation rates but nothing was said about the agglomeration’s budget. Following the recent municipal election, the city’s so-called minority partners are now forced to deal with a 12.6 percent increase in their “agglo” rates which the ASM report denounces as both financially and politically unacceptable. The report also denounces Mayor Tremblay’s autocratic approach to “agglo” concerns when he made it clear there would be no changes made, or even considered for the 2010 budget. Thus were the suburbs effectively cut out of the budget’s discussions even though the city’s independent suburbs finance almost 20 percent of the city’s budget without any serious participation in the process. As for the budget’s actual figures, both Mayor Tremblay and executive committee member Alan DeSousa will have to explain the 9.4 percent increase (excluding debt repayment) in the city’s operational spending habits. Apart from the fact this means the city will be spending a combined $190 million more than it spent last year, Mayor Tremblay will have to explain why that total includes an additional $91.9 million which must be paid into the city employees’ pension funds along with another $62.2 million going to the STM and the island’s AMT — the island’s beleaguered suburban train service. Considering the city’s already difficult economic situation, the island’s suburban mayors consider the increase to be completely unacceptable.

Apart from the fact two of the city’s three largest departments, as defined by the SPVM (Service de la Police de la Ville de Montréal) and the city’s SIM (Service des Incendies de Montréal) happen to represent 40 percent of the agglomeration’s total budget, the ASM report bitterly denounces their absence from the agglomeration’s budget process. Apart from their vociferous complaints about both the SPVM and the SIM being absent from their budget consultations, the ASM report also condemns the new budget’s lack of any kind of so-called “trend analysis” because in this case, such information would demonstrate how the central city’s bill for regional police and fire services are being increased at roughly three times the normal inflation rate.

Other issues include several millions of dollars worth of hypothetical revenues for the STM —the city’s public transport system — which could easily become deficits if such revenues turn out to be nothing more than wishful thinking. The report also condemns similar confusion about assorted tri-annual infrastructure investments.