It’s time to cap City spending and tax hikes

Hamilton city councilor Brad Clark wants to put a cap on future tax increases.

Scott-Radley

By Scott Radley Reporter

Scott Radley is a columnist with the Hamilton Spectator focusing on sports and politics. Reach him at sradley@thespec.com.

There’s a chance that when council gathers Wednesday for its last real opportunity to trim the 2025 budget, it could have some success bringing down the looming tax increase a bit.

Mind you, after Friday’s seven-hour attempt at finding savings saw the coming hike whittled all the way from 5.7 per cent to 5.6 per cent, it feels like there’s a better chance of spotting the Loch Ness Monster in Hamilton Harbour than seeing the final number drop by much.

So perhaps it’s time to do this whole thing differently.

Coun. Brad Clark believes it’s time to stop asking city staff what they need and then hiking taxes to cover that amount. Instead, it’s time to give them an amount they can have and tell them to live within it. Require them to find efficiencies and redundancies and make it work.

On Wednesday, he’ll bring a motion asking to have staff report back on how it could operate within a 2.5 per cent increase next year. The cost of inflation, basically.

Something has to be done, he says.

Spending went up 19 per cent last year, he points out. It’s up another eight per cent this year. Capital spending is up monumentally. Water rates are way up. A stormwater fee is coming.

The nearly 18 per cent levy increases that have resulted from this council doing so much spending in just three years have been “a horrendous penalty” to taxpayers, Clark says.

The only reason taxes haven’t risen more than that is because city reserves have been heavily mined to cover many of the costs. These accounts aren’t bottomless pits, though. That’s unsustainable.

A few weeks ago, Coun. Matt Francis declared that this council has a spending problem. At the same meeting, Coun. Jeff Beattie said people are at their limit. Coun. Ted McMeekin said he hears from many folks about the increases. Other councillors have also spoken about the situation.

It’s not a secret why it’s all happening, Clark says.

“This is a bureaucracy that sees a council that is willing to spend excessively,” he says. “And so the general managers are coming forward and saying, ‘I need 10 more (employees), I need 20 more, I need 100 more.’ And they just keep adding. And the council keeps saying yes.”

The answer? If neither side has shown it has the self control to restrain itself, maybe a cap will help.

It’s not the first time something like this has been proposed. Not even the first time this term. Last year, McMeekin suggested a four per cent maximum increase on city spending. It had some support, but it never came to a vote before the budget process wrapped up.

On Friday, Francis introduced a motion to see what would be involved in capping this year’s tax increase at the Consumer Price Index level of 3.44 per cent, essentially reducing it to the level of a typical household’s cost increases.

That idea was rejected, in part because the items measured by CPI and the items purchased by the city aren’t an apples-to-apples comparison and also because it was too late to ask staff to create a whole new budget at this stage of the process.

Clark says his plan wouldn’t be for this year — it’s too late for that — but a different approach is needed going forward, he insists.

“At some point in the future, we’re no longer going to have the reserves,” he says. “We’re no longer going to have the financial gimmicks. You’re going to have to either make significant cuts and find significant efficiencies or you’re going to increase the taxes to the point where people are saying, ‘Hamilton is too high, I’m not going to live there anymore.’”

Residents are angry, he says. Some are feeling vulnerable because their costs are rising faster than their ability to pay. Some fresh thinking is needed.

Will his motion pass? He doesn’t know.

But he’s quite sure continuing along this path won’t lead anywhere good.

“I truly fear that we’re hitting a point where there will be a taxpayer revolt.”