Minimizing the financial impact

Per City of Waterloo policy, we use a 12-month average of the Core Consumer Price Index to guide our base budget and operating impacts of capital and growth. This was trending at 4.28% on a 12-month average as of September 2023 data. While inflation has improved compared to this time last year, the City of Waterloo continues to faces challenges related to price escalation, and recognizes the impacts on the community as well. Our beginning base budget and operating impacts of capital and growth amounts to support existing services in 2024, 2025 and 2026 is 3.82%, 3.86% and 3.55%, which is less than the trending inflation rate of 4.28%.

This base amount below the rate of inflation, includes $1.6M in efficiencies, equivalent to 1.75% in property tax savings.

To support new services, we add additional funds to this base amount for council consideration, following the community priorities of our strategic plan. These include expanding the fire department (a matter of community safety, with potential impacts to residential fire insurance rates), improving winter sidewalk conditions (a key community ask during the 2023 budget process), and adding more planning resources to help address local housing concerns (needed to advance our affordable housing strategy, and to meet our provincial housing goals). Council endorsed these services when staff presented reports on them in 2023, but they can still decide to make adjustments. The increases for new services are 2.64%, 2.44% and 1.89% for 2024, 2025 and 2026.

Council have access to a list of menu items for potential additions or reduction to these new service levels. The menu items include a total of $2.4M in reduction opportunities (equal to a 2.5% property tax reduction) that Council will consider and may choose to use as part of their deliberation process, which could change this amount.

The 1% final addition for infrastructure costs, including needed updates at our facilities to reduce greenhouse gas (GHG) emissions in this climate emergency, is also something Council can consider and may choose to adjust as part of their deliberation process.