The Municipality of Chatham-Kent will not apply for Phase 2 of the Safe Restart Agreement Fund, after Council approved staff recommendations from a report at their electronic meeting held on Monday, October 19, 2020.
As recommended by administration, Council directed staff that Phase 1 Safe Restart Funding be used to cover any COVID-19 related 2020 operating deficits with remaining funds brought forward for Jan 1, 2021 to March 31, 2021 Covid-19 operating deficits.
Council also endorsed sending a letter to Steve Clark, Minister of Municipal Affairs and Housing, requesting the following immediate COVID 19 actions:
– Change the eligibility of Phase 2 Safe Restart Agreement Funds for unconditional use in the 2021 municipal budgets to keep property tax increases to a minimum
– Fund 100% of COVID-19 expenses for land ambulance, long term care and public health without impacting property taxes
– Increase funding to municipalities to cost share in creating new affordable housing
– Work with municipalities and the Federal Government on new revenue opportunities or share of the HST as we move to a more digital economy
– Work with municipalities and the Federal Government to declare broadband internet an essential service and increase funding
Gord Quinton, the chief financial officer in Chatham-Kent, said while some information has flowed from the Province in regards to COVID-19 funding, they have yet to approve a 2020-2021 budget and details remain lacking.
“With estimates based on current information, a more accurate deficit is likely in the $2-million to $3-million range,” Quinton said in a report.
“The Province has provided $5,817,800 to cover the 2020 operating deficit. Any remaining funds from this grant are to be carried forward for early 2021 COVID-19 operating deficits, with reporting back to the Province required by March 31, 2021.”
Quinton said in discussions with Provincial staff there are restrictions against providing direct property tax relief with the funds.
“The funds can only cover direct Covid-19 operating expenses or revenue losses,” he said.
“In addition, providing property tax relief to any one group of taxpayers could be challenged by Section 106 of the Municipal Act, 2001.”
Quinton said administration participates in bi-weekly discussions on COVID-19 matters with the Ontario Regional and Single Tier Treasurers (ORSTT), a group representing over 75% of Ontario’s population.
“Only Ottawa has indicated to date a need to apply for Phase 2 funding due to the Federal Government shutdown impact,” Quinton said.
“Similar to Chatham-Kent, ORSTT municipalities have indicated that on average only 50% to 75% of the Phase 1 allocations was needed to cover the allowed 2020 Covid-19 direct deficits.”
Quinton added: “The ORSTT group is recommending all municipalities provide a similar message to the Province on the need for unconditional funding to assist 2021 Budget preparations to keep the tax increases as low as possible for property taxpayers and consider new revenue streams for future years.
Quinton said in his report Chatham-Kent and the Province are dealing with “one of the most severe shocks to hit a modern economy in decades.
“COVID-19 has stressed the economy and the Municipality’s citizens and institutions, and will continue well through 2021. Chatham-Kent needs to press the Provincial Government to help mitigate the property tax impact of Covid-19 by providing predictable funding prior to 2021
budget deliberations,” Quinton said.
The Municipality has received COVID-19 related funding from the Province through other streams to support transit, land ambulance, social services, public health, long term care and emergency shelter operations, Quinton said, adding that discussions are ongoing with the Province on the details.
He said the 2020 October variance report will be delivered to Council at the December 14 Council meeting, where an estimate of remaining Phase 1 funds will be determined prior to 2021 Budget deliberations.
