During this global pandemic, the Region of Peel increased Your Taxes Again…and apparently, not a single person has asked to cut taxes?
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What Happened?
Last week, the Region of Peel passed a $3.7 billion budget, resulting in increased property taxes for Brampton’s residents and businesses. As the global pandemic wreaks havoc on Canada’s economy, significantly impacting working families and small businesses, Regional Councillors put on their blinders and voted to increase their spending. According to Regional Councillor Carolyn Parrish, “I haven’t had a single person ask for that (cut taxes) other than MBOT (Mississauga Board of Trade).”
As per the Region’s official media release, the 2021 budget represents an overall 1.02% increase in property taxes and only a 12 cents per day increase in utility rates. Not that shabby, don’t you think?
The 1.02% is achieved by “blending” the Region’s 2.5% property tax increase with Brampton’s 0.0% onto a single tax bill. So if you are wondering why your tax bill increased when the City of Brampton passed another 0% budget, look to the Region for an explanation. Putting aside percentages, the real story is the amount of money the Region is actually spending.
The Big Spend
The officials at the Region of Peel do not include the actual increases in regional spending in their media release. For example, with this new term of Regional Council, the chart below illustrates that “gross” expenditures have increased 19.2% since 2018, equating to just over $592 million.
Within three years, Regional Council approved increases to operations by 11.6% ($216 million) and raised water rates by 20% (or $100 million). Then, they subtract federal and provincial funding, user fees, revenue, and reserves, thereby calculating the “net” expenditures that appear on the property tax bill. However, as we all know, all the money comes from the same taxpayer.
From another view, Peel Region’s media release indicates the water rates in 2021 will only increase about 12 cents a day for the average homeowner. The real number, that the regional government increased in their expenditures related to water and wastewater services, is 7.3% (or $42.3 million) for a total of $605 million.
Brampton’s Share
Peel Region raises their taxes by billing its three local municipal governments: Mississauga, Brampton, and Caledon. In turn, the three local municipalities send out a single property tax bill with a combination of local municipal taxes, regional taxes, and education taxes.
The “net” regional costs are allocated to the three local municipalities via a complex funding formula utilizing property assessments. The formula’s result is approximately 4.7% for Caledon, 35.8% for Brampton, and 59.5% for Mississauga (Source: 2019 Financial Information Return). Applying this percentage in 2021, Brampton’s taxpayers will provide roughly $423 million in taxes to Peel Region in addition to paying their water bills. It is then Regional Council that determines how the money is spent.
The Decision Power
Regional Council is currently composed of 25 members: 13 Councillors from Mississauga (which includes the Regional Chair), 7 Councillors from Brampton, and 5 Councillors from Caledon. Recently, with strong opposition from Caledon, Regional Council proposed to the province a reconfiguration, where Brampton would receive two seats from Caledon, making the representation: 13 Councillors from Mississauga, 9 Councillors from Brampton, and 3 Councillors from Caledon. Although the number of Councillors from Brampton increases, Mississauga Councillors firmly remain in control with the majority vote.
With majority voting power, Mississauga Councillors can determine how regional taxes are spent, where to invest in infrastructure, and who to hire in the senior management. For example, with the retirement of their Chief Administrative Officer David Szwarc, Regional Council formed a selection committee to recruit the next CAO. However, rather than follow due process, the Region abruptly abandoned the selection committee process and voted to hire the CAO from the City of Mississauga, Janice Baker.
The initial task to recruit a new CAO was assigned to the Policies and Procedures Committee chaired by Regional Councillor Carolyn Parrish (Mississauga) and 11 other Councillors. But rather than allow the committee to complete their work, Regional Council bypassed the process and directly hired Baker. Voting against the hire was Mayor Thompson (Caledon) and Mayor Brown (Brampton), with Mayor Crombie (Mississauga) and Regional Chair Iannicca (Mississauga) voting in favour.
I Have Not Had A Single Person Ask To Cut Our Taxes
On February 11th, Regional Council met to discuss the budget. Brad Butt, VP of Government Relations and Stakeholder Relations for the Mississauga Board of Trade, presented at the meeting. Not only was he representing the Mississauga Board of Trade, but he was also speaking on behalf of the five Business Improvement Associations across the City of Mississauga. He had an explicit request to Regional Council, “Support a 0% property tax increase for 2021…we know other surrounding municipalities are doing it”. Butt was referring to the City of Brampton, which managed to maintain a zero percent property tax increase in 2021 without cutting services or eliminating capital projects.
Brad Butt’s message is similar to the notice issued by the Canadian Federation of Independent Businesses (CFIB), the national champion of over 110,000 small business members. The CFIB has been asking governments to lower taxes as businesses struggle to manage against the pandemic.
Regional Councillor Michael Palleschi (Brampton) attempted to reduce the property tax burden by supporting a motion from Councillor Saito (Mississauga), which proposed a 0% increase to the capital portion of the budget. To support his request in lowering taxes, Palleschi stated, “We, as a show of good governance, need to support the residents of Peel to give them the best tools and ability to just get through the remaining of this year, and hopefully we come out of 2022 on a positive”. Regional Councillor Carolyn Parrish (Mississauga) responded, “I haven’t had a single person ask for that (cut taxes) other than MBOT (Mississauga Board of Trade).”
Really? Not a single person has asked Councillor Parrish to stop raising property taxes?
Interestingly, Brampton’s Councillors Fortini, Medeiros, and Vicente all voted against Palleschi’s attempt to reduce property taxes. In the end, the vote was tied, with half the Regional Council supporting Palleschi and Saito, and the other half opposed. As per the Region’s Procedural Bylaw, in case of a tie vote, the Regional Chair has the option to break the tie. Regional Chair Iannicca decided against voting, thereby allowing the motion to fail.
With Palleschi/Saito motion lost, Regional Council then considered lowering the capital budget from the initial 1.0% increase to an alternative a 0.6% increase.
This Is Becoming A Real Farce
Before voting on any motion, a Councillor is permitted to ask the Chair to clarify the motion. However, this request for clarification occurs before the vote, and not during the voting. During the budget discussion, disorder occurred when Palleschi attempted to amend the primary budget vote, as evident by the following exchange:
Regional Chair Iannicca: I’ve ruled. We have the main budget (motion) before the Chair. We have already been cascading down the vote. I’m going to rule that I have a motion before me, we’ve had a healthy debate, the second motion (Palleschi’s amendment) never had life at any point, but be as it may, if I made an error I apologize, but I’m going to proceed with the vote, if someone wants to challenge the Chair they can, but we have the final budget and the motion that was put before me now, from Councillor Saito, Councillor Thompson. Madam Clerk, the vote, over to you.
Councillor (not identified): It was not Councillor Saito.
Councillor Saito: Mr. Chair, I’ve had my hand up to ask a question on the motion.
Councillor (not identified): So have I.
Councillor Saito: Do you recognize those of us that have questions please before you take the vote.
Regional Chair Iannicca: Um, we had the motion before the Chair, we’ve exhausted all questions. I have…
Councillor Saito: No we did not, we were discussing my motion previously, we took the vote, and now you have brought another motion forward, and I have a question on it.
Regional Chair Iannica: And I will say it again, you didn’t put it forward when I asked for it.
Councillor Saito: Mr. Chair, this is becoming a real farce. Forget it.
Regional Chair Iannica: Thank you, the motion is before the Chair, Madam Clerk, call the vote please.
Regional Clerk: Thank you Mr. Chair, Councillor Singh? (Councillor Singh responds “no”). Councillor Carlson? (Councillor Carlson responds “no”). Mayor Crombie?
Mayor Crombie: So, just to be clear, I’m voting for the original budget with the 1%…
Councillor Palleschi: Take the vote please.
Mayor Crombie: Excuse me, are you being rude?
Councillor Palleschi: No, I’m just asking, the Chair is pushing the vote, let’s vote.
Mayor Crombie: Councillor Palleschi, Point of Order, you are being rude and indignant. Mr. Chair, may I please have clarification what I am voting on…
Councillor Palleschi: I’m sorry if you feel I’m being rude…
Multiple Speakers
Regional Chair Iannicca: Order, order, Madam Clerk what is the motion before the Chair…Ok, and I will read it as such…(reads the full motion).
And that is how Peel Region approved a $3.7 billion budget. After a 2-hour debate and $3.7 billion in expenditures later, Regional Council raised property taxes, which ignored the Mississauga Board of Trade (and other organizations like the Canadian Federation of Independent Business). Overall, they increased their annual spending by about $70 million (operations and water) in addition to a 0.6% increase in the capital budget.
There was no relief to hard-working families trying to figure out which bills to pay first or any consideration that many businesses in the Region may never re-open when this pandemic is finally over.
