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October 20, 2010

Municipal Services a Bargain

The other day a candidate for muncipal council came to my door. I live in Kitchener. The candidate started explaining his priorities. Fiscal transparency was top of the list. He pointed out how water rates in Kitchener had leapt by 54% in the past three years.

I am all in favour of fiscal tranparency. But I had to stop and ask him how much his water bill is. He was not sure. Mine is only $450 a year -- and that is after the increase. And the increase was due to upgrades in the system to assure that the water remains safe and an accident like that which happened in Walkerton, Ontario does not happen in my city. Why would I oppose raising water rates to make that kind of investment?

The local paper, The Waterloo Region Record, has led the way in suggesting that municipal spending is spiralling out of control, not only water rates but also municipal wage costs. It led me to look into how big a bite property taxes take out of my family's income. I was surprised to learn how little the impact is. My property tax bill amounts to only 3% of our househould income. And the water bill only 0.57%.

I sent the following letter/article to the Record.

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Municipal services a bargain


Have water bills gone through the roof? And are property taxes spiralling out of control?

Jeff Outhit’s (Sept 20) article on rising water bills and the Waterloo Region Record’s (Sept 28) editorial on soaring municipal wage costs gave me reason to examine how these changes have impacted me and my family. The Record reports that water rates have soared 54% between 2007 and 2010 and that the municipal wage bill has risen 19% between 2006 and 2010.

I do not know my final income for 2010 nor do I have all my water bills come in yet this year, but I was able to compare the 2007 and 2009 figures for our household. Sure enough, the water bill had “soared” 48% in those two years. That amounted to a whopping $150 increase for our household. The cost of clean municipal water ate up 0.57% of our household income in 2009; that is, just a bit more than half a percent. That’s not too alarming.

Outhit’s article explained four reason’s for the steep rise in water rates: “The Walkerton water tragedy, environmental needs, aging systems and water conservation.” Those strike me as compelling reasons for the rise in water rates. Frankly I think it would have been highly irresponsible of municipalities to not make the investments needed to make sure we have a safe and adequate supply of water.

The Record’s editorial suggests that Municipal wages are “spiralling out of control”. Presumably, I fall into the category of the “overtaxed citizen” that the editorial defends. After all, I earn less than the average municipal employee wage. So, I decided to look at the damage my property tax bill has inflicted. Once again, the Record’s calculations have some resonance. My property tax bill rose 6.6% between 2007 and 2009. That meant that my property tax bill ate up 3% of our household income in 2009 compared to 2.5% in 2007. Those numbers do not really ring alarm bells either.

The local Community Foundations recently released their latest Vital Signs report for Waterloo Region. In it they list some of the services the Regional Government delivers: “road systems, transit, community housing, garbage collection, police services, social services, child care services, public health, Regional airport, cultural services, ambulance services, long-term care facilities, and grant to agencies and organizations.” The list is long. It does not include the services delivered by our city and township governments, things like parks, libraries and community centres. Nor does that list include public schools. Property taxes fund all of those services. And it all costs my household 3% of our annual income. That strikes me as an incredible bargain.

When I consider that the GST was cut by 2% and that I have enjoyed income tax cuts by successive federal and provincial governments over the past ten years, I really cannot complain about being overtaxed.

I want to know that the Region, cities, townships and school boards are making stewardly use of public resources. But I am less interested in joining an anti-tax crusade than I am in seeing that the people we elect implement the policies and programs that help make Waterloo Region a safe, prosperous and inclusive community.

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What is your own experience? Do you know how much you pay each year in property tax and for water? How does that compare with your annual income?

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