2008 Budget & Tax Policy Overview Flamborough

1. 2008 Budget & Tax Policy OverviewFlamborough May 7th, 2008

2. 2008 BUDGET

3. 2008 Budget • Tax Budget • Total $1.1 billion • Amount raised in taxes = $630.1 million • Average residential taxes = $2,657 ($3,204 with educ) • Water and Sewer • Total $163.4 million • Average bill (260m3) = $569; (300m3 = $648) • Capital Budget • 10 year - $1.4 billion • 1 year - $150 million • Annual impact $76.8 million (6.7%)

4. 2008 Tax Budget by Department ($ millions) DRAFT; Note – All figures rounded

5. City Services • Planning & Economic Development $16.2 M • Building / Licensing • Economic Development / Tourism • Parking / School Crossing / Animal Control • Long Range Planning / Downtown Renewal • Public Health $8.7 M • Medical Officer of Health • Health Protection / Family Health / Healthy Living • Community Services $158.1 M • Employment & Income Support / Benefit Eligibility • Social Development & Early Childhood Services • Social Housing • Macassa & Wentworth Lodge • Culture & Recreation (area rated)

6. City Services • Hamilton Emergency Services $81.6 M • Fire (area rated) • Ambulance (Emergency Medical Services • Emergency Preparedness / Corporate Radio System • Public Works $162.2 M • Roads / Traffic / Winter Control / Parks • Transit (area rated) / DARTS • Waste Management • Fleet & Facilities • Capital Planning Implementation • Corporate Services $34.6 M • Mayor / Council • City Manager / Legal / Audit / Human Resources • Finance / Taxation / Customer Service / Clerks / IT

7. City Services • Net General Revenues ($69.3 M) • Community Reinvestment Fund (CRF) • One-time Provincial special funding • Slot Revenues / Investment income • Hydro dividends ($6.5 million) • Payment-in-Lieu of taxes / supplementary taxes / penalties + interest • Provincial Offences Act (POA) • Capital Program $76.8 M • Boards & Agencies $161.2 M • Police ($116.1 M) • Library ($25.3 M) • HECFI / MPAC / GO transit / Conservation Authorities ($14.7 M)

8. New Initiatives - 2008 Strategic Capital Investments $8.0M Land ambulance $6.0M Red Hill / Hwy 6 $3.0M Economic Development $1.5M Transit services $0.5M National Child Benefit (NCB) $0.3M Tree trimming $0.3M Integrity Office $0.05M

9. 2008 Total Taxes$806 million $176.0 million $507.1 million $29.0 million $29.2 million Area Rated 16% $122.9 million $64.7 million

10. 2008 Residential Tax Impacts* (based on City-wide average) City-Wide Municipal Only 4.6% * includes transit where applicable

11. 2008 Residential Tax Impacts* (based on Municipal average) City-Wide Municipal Only 4.6% * includes transit where applicable

12. 2008 Residential Tax Impact Ward 14 (Flamb only) Ward 15 (Waterdown) General increase 2.9% 2.9% Transit 0.0% 1.2% Fire 1.3% 1.3% Slot revenues 4.5% 4.5% TOTAL TAX IMPACT 8.7% 9.9%

13. Cost by Service – 2007/2008 * Ward 14 (Flam) does not pay for transit ** 2008 = -$24 from slot revenues in general levy (net impact = +$177) * ** Based on a home assessed at $293,000; 2007 restated

14. 2008 Tax Impacts by Property Class

15. Residential Tax Rates (in the Transit Area) 2007 2008 Hamilton 1.596% 1.646% Dundas 1.443% 1.481% Ancaster 1.404% 1.472% Stoney Creek 1.425% 1.461% Flamborough 1.306% 1.435% Glanbrook 1.356% 1.388% Note: includes education tax rate (0.264%)

16. Residential Tax Rates (outside the Transit Area) 2007 2008 Hamilton N/A N/A Dundas 1.422% 1.459% Ancaster 1.386% 1.453% Stoney Creek 1.399% 1.434% Flamborough 1.306% 1.420% Glanbrook 1.325% 1.356% Note: includes education tax rate (0.264%)

17. 2001 - 2008 Approved Capital Project Ward 14 & 15

18. 2001 - 2008 Approved Capital Project Ward 14 & 15

19. 2001 - 2008 Approved Capital Project Ward 14 & 15

20. Per Capita Municipal Comparisons 2006 FIR, Census Population

21. Per Capita Municipal Comparisons 2006 FIR, Census Population

22. Per Capita Municipal Comparisons 2006 FIR, Census Population

23. Assessment per Capita (unweighted) 2007 Municipal Study

24. HISTORICAL

25. 2001 – 2007 Key Budget PressuresCity-wide Impacts 2001 – Amalgamation savings maintained levy at less than inflationary increase. 2002 – Waste Mgt; Emergency Services; Transit; Public Health 2003 – Police Services; Capital 2004 – Police Services; Capital; Winter Control; Transit 2005 – Winter Control; Homes for the Aged 2006 – Social Services; Waste Mgt 2007 – Social Services; Waste Mgt; DARTS; Tax Write-offs

26. Historical Average Residential Tax Impact Average Residential Tax Impacts (2001 – 2008)

27. Historical Average Residential Tax Impact Breakdown of Flamborough Average Residential Tax Impacts (2001 – 2008) 2001 – without area rating, Flamborough would have experienced an average tax increase of 27%

28. 2000 Municipal Taxes $28.5 million Flamborough – 2000 Taxes 2000 Total Taxes $44.0 million $6.7 million $21.8 million $6.7 million $15.5 million $21.8 million

29. 2007 Total Taxes $62.8 million Flamborough – 2007/08 Taxes 2008 Total Taxes $70.5 million $1.5 million $15.8 million $5.4 million $45.5 million $16.8 million $48.3 million

30. 2000 Municipal Taxes $452.7 Million Share of Municipal Taxes2000 vs 2008 2008 Municipal Taxes $630.1 Million Includes both Local and Regional Municipal Levy

31. AREA RATING

32. Background • O’Brien commission report recommended area rating as a means to mitigate differences in services and costs. It specifically mentioned Fire & Transit • City/Region joint submission recommended area rating fire, library, recreation and transit • At amalgamation, Bill 25 provided for the creation of special service levies. This authority to add area rated servicesunder Bill 25ended in 2002 • Once remove service from area rating, must adhere to “special service” definition to be able to area rate again

33. Background • Area rating was used as a means to mitigate differences in: • Services and service levels • Cost to deliver the service • User fees for same service • Tax increases due to amalgamation

34. Background • Municipal Act allows municipalities to area rate “special services” • “Special Service” is defined in the Act as “a service or activity of a municipality…that is • not being provided or undertaken generally throughout the municipality, or • being provided or undertaken at different levels or in a different manner in different parts of the municipality” • Decision to area rate is at the sole discretion of the city council (reviewed annually)

35. Background • Prior to amalgamation, the former Region of Hamilton-Wentworth area rated the following services: • Transit (50/50) • Wentworth Library (SC, GL, AN, FL only) • Waste Management (tonnage) • Storm Drainage (Hamilton only)

36. Background • In 2001, Council adopted the following area rated services: • Transit (Flam = $0) • Fire (Flam = $1,181,260) • Culture & Recreation (Flam = $781,900) • Storm (Flam = $0) • Senior’s Tax Credit (Flam = $0) • Slot Revenues (Flam = $615,000) • Financial Adjustments (Flam = $300,000)

37. Background • Since 2001, Storm, Senior’s Tax Credit and Financial Adjustments have been removed from area rating • The City of Hamilton area rated the following services in 2007: • Transit • Fire • Culture & Recreation • Slot Revenues • Area rate by former area municipality

38. Slot Revenues (2001 - 2008) • Since 2001 a total of $27.8 million in Slot Revenues was directed to Flamborough • $12.8 million to lower tax impact • $15.0 million for Borer’s Creek

39. 2008 Residential Taxes Differences in Area Rated Services Based on home assessed at $293,000)

40. Area Rating - Council Direction • The following motion was approved by Council (Sept 26/07) “That, “with the exception of the Flamboro Downs slot revenues”, the City of Hamilton maintain the current area rating tax policy for 2008, and the City of Hamilton begin a thorough review of the implications of eliminating area rating after the budget process, and for it to be presented to Council for June 2008.”

41. 2008 Slot Revenues – Options • Option 1: Maintain 2007 $ allocation to Flamborough and Ancaster, with the increase being applied exclusively to the General Levy • Option 2: Prorate the increase in slot revenue to Flamborough, Ancaster and the General Levy based on 2007 allocation • Option 3: Five-year phase-out of the slot allocation to Flamborough and Ancaster • Option 4: Ten-year phase-out of the slot allocation to Flamborough and Ancaster • Option 5: Five-year phase-out of the slot allocation to Flamborough and full elimination of the slot allocation to Ancaster • Option 6: Full elimination of the slot allocation to Flamborough and Ancaster (entirely on the General Levy in 2008)

42. REASSESSMENT & TAX POLICY

43. Reassessment Schedule * Commencing in 2009, reassessments will be conducted every four years, coupled with the implementation of a mandatory phase-in program

44. Impact of Reassessments – Residential Class Average Change In Property Values due to Reassessment Resulting Average Tax Impacts due to Reassessment * Incorporates offsetting reassessment tax shifts between property classes

45. Tax Policies • No reassessment in 2008 • Next reassessment in 2009 (3 years between valuation dates) • impacts unknown • many changes pending • 4-year phase-in for all property class • possible changes to capping program

46. Recommended 2008 Tax Policies • Relief to Low-income Seniors & Disabled – continue existing deferral program (no change) • Rebates to Charities – continue existing program (40%) • Vacancy Rebates – continue existing program (30% commercial; 35% industrial) • Legions / Veterans Exemption – no change, 3yr term established in 2006 • Seniors Tax Rebate – continue existing program, update criteria: • Income = $30,170 ($29,600 in 2007) • Assessment = $266,300 ($265,100 in 2007) • Rebate = $156 ($153 in 2007)