Waterloo region asks feds for cash as revenues plummet and costs rise
'We are now providing services at a municipal level that the tax base was never created for': Redman
Waterloo region has sent a formal request to the federal government asking for more financial assistance to help the municipality through the COVID-19 pandemic.
Regional Chair Karen Redman says while the federal government has offered some extra money to municipalities from the gas tax, it's not enough, and the region needs more to cover costs it is incurring.
"Our revenues are plummeting, and our costs are rising as we manage this pandemic," Redman said during a media briefing on Monday.
The region declared a state of emergency on March 25.
Regional revenues have dropped off for a number of reasons, including transit fares being cancelled and dumps being closed, until recently. The region is waiving late payment charges on water and wastewater utility bills, as well as all other residential and non-residential accounts.
The region is spending more on personal protective equipment for workers who deal with the public, and it has picked up the tab for things like emergency child care. The province has said it would fund child care, but the region has not been told when that money is coming.
"There's always been a sense that we are now providing services at a municipal level that the tax base was never created for," Redman said.
Can't run a deficit
To cover the costs at a municipal level, the region would have to do one of three things: increase property taxes, raise the cost of user fees for services and/or reduce services.
The region is not allowed to run a deficit under provincial rules. Regional CAO Mike Murray says even if the region was allowed to, it wouldn't want to go in the red — even as a temporary measure.
"If we run a deficit, we need a path out of the deficit. If we created a big hole for ourselves, one of the questions on everyone's mind is how would we ever dig out of that hole," he said.
The region can't borrow money to run a deficit and, Murray noted, "the exit from a deficit would be intensely challenging for municipalities."
Redman said other groups, including the Federation of Canadian Municipalities, are advocating on behalf of municipal governments who are feeling the financial pressure of the pandemic.
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