Municipal subsidy report Prepared by Fred Mueller November, 2006

FINANCIAL SUBSIDIES

MUNICIPALITIES IN THUNDER BAY DISTRICT

 

2005*

 

Budget Size

Municipality

Total Budget

Direct Taxes

Provincial Subsidy

 

 

(Millions)

(Percentage)

(Percentage)

1

Thunder Bay

320

38%

31%

2

Greenstone

25.3

38%

38%

3

Marathon

10.3

47%

24%

4

Oliver-Paipoonge

8.2

37%

49%

5

Shuniah

6.3

40%

44%

6

Terrace Bay

6.2

55%

31%

7

Manitowadge

5.2

44%

42%

8

Red Rock

4.5

47%

27%

9

Nipigon

4

45%

40%

10

Schreiber

3.9

36%

31%

11

Neebing

3.5

34%

57%

12

Dorion

1.1

35%

51%

13

O’Connor

1.1

33%

56%

14

Conmee

1

44%

57%

15

Gillies

0.7

26%

67%

 

Source:  Ontario government, www.csconramp.mah.gov.on.ca/viewfir2005.htm

 

Notes:

  1. The numbers are rounded off for simplicity.
  2. The remainder of the budgets which are not included in direct taxes or provincial subsidies are mainly user fees.
  3. A large commercial tax base (such as a paper mill) in a small town tends to skew the direct taxes because the commercials are so heavily taxed.  Towns such as Neebing, O’Connor, and Gillies show a more realistic taxation level because most of the tax base is residential (i.e. the voting public).  Even Thunder Bay is closer to this category. 

Conclusion:  Residential property taxes contribute about one-third (33%) to the total municipal budgets.  Contrast that with the provincial subsidy numbers.  My guess is that not even Marathon raises as much in residential property taxes as they receive from the provincial coffers.

 

There is no township in the unincorporated areas of Thunder Bay District which has a budget anywhere near the size of the smallest municipality of Gillies.  From looking at the last few entries in the chart above, it seems reasonable that the provincial subsidy for the unincorporated areas would be two-thirds (67%) or more.  This is clearly not the case.  Below is a summary for the unincorporated township of Lybster for 2005 as a comparison:

 

COMPARISON CHART:

UNINCORPORATED AREA PROVINCIAL SUBSIDY

2005

Unincorporated

Total Taxes*

Direct Property

Provincial

Provincial

Township

(For a $100,000 property)

Taxes

Subsidy**

Subsidy (Percent)

Lybster

$1,234.00

$951.00

$283.00

23%

 

 

 

*  Total taxes include:

Provincial Land Tax (PLT)  

$50.00

 

 

 

Education and interim-PLT

$498.00

 

 

 

Local Roads tax

$283.00

 

 

 

Provincial Road subsidy

$283.00

 

 

 

Local Service Board tax

$85.00

 

 

 

Dump fees

$35.00

 

 

 

Total

$1,234.00

 

 

 

            ** The only provincial subsidies received by Lybster are provincial matching funds (one to one) for direct road taxes.

 

 

Conclusion:

Every municipality in the District of Thunder Bay receives a greater percentage of provincial subsidies than the unincorporated example set out above.  Since all taxpayers contribute equally to the provincial funds, it appears that the unincorporated areas are subsidizing the incorporated municipalities.

 

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