Decreasing the municipal burden in Sault Ste. Marie

How do you calculate the relative affordability of local government from place-to-place within a province such as Ontario? For residential taxpayers, one of the important measures to look at is something called the “municipal burden.”

While property taxes are the biggest part of the municipal burden, water and sewer costs are also an important part of the equation. When you add together property taxes with water and wastewater costs, you have what is referred to as the “total municipal burden.”

Each year, the BMA Municipal Study collects financial and spending data about a large cross-section of Ontario municipalities. BMA calculates the municipal burden for residential homeowners in each community by taking the average cost of residential taxes and adding the costs to use 200 cubic meters of water annually.

How does Sault Ste. Marie rank?

The 2015 BMA study calculated that Sault Ste. Marie’s total municipal burden was $3,669—$2,830 of that being property taxes and the remaining $839 being water and sewer charges. In absolute dollar terms, we actually trended low for the total burden, ranking 19th lowest out of 98 participating municipalities. The file linked below has the full rankings, sorted by the total burden.

BMA Study, Ontario Municipalities – Total Municipal Burden 2015

The good news is that according to the 2016 BMA study, the total municipal burden in Sault Ste. Marie actually dropped between 2015 and 2016—falling from $3,669 to $3,423. That is the 5th lowest total out of the 102 municipalities that provided data for the 2016 study.

BMA Study, Ontario Municipalities – Total Municipal Burden 2016

Much of the improvement in Sault Ste. Marie’s municipal burden figures from 2015 to 2016 is the result of changes to our water and wastewater rates. Both City Council and the PUC Board took steps late in 2015 to decrease water costs for residents and businesses in Sault Ste. Marie. City Council made the move to decrease the sewer surcharge from 100% to 62% for residential users—bringing it to the lowest level since 1982.

water-costs_2016

The PUC board also did its part to help ratepayers. The board elected to forgo increasing water rates in 2016 and instead opted to keep them at the 2015 level. This was done at a time when many other municipalities were increasing their water rates by as much as 7 per cent.

As a percentage of household income, Sault Ste. Marie’s municipal burden in 2016 stood at 4.2% – the lowest it has been since we began participating in the survey in 2005. The chart below shows the changes since 2009.

muni_burden

When it comes to keeping the cost of local government affordable for residents, property taxes understandably get most of the focus. However, it bears remembering that water and sewer charges are a significant part of the equation as well. I’m pleased that both City Council and the PUC were able to make decisions that have had a positive impact for citizens, the significance of which we are now starting to measure.

–         CP