Report finds Northern Ontario municipalities serving more residents than they can tax
By: Pam Fedack, Local Journalism Initiative Reporter
Source: Kenora Miner & News
A new report from the Northern Policy Institute (NPI) suggests that many municipalities across Northern Ontario are bearing the cost of providing services to residents living outside their boundaries who do not contribute to municipal property tax revenues.
The report, titled Serving More People Than You Can Tax: The Fiscal Impact of Municipal “Fringe Populations” in Northern Ontario, examines the financial impact of residents living in nearby unorganized areas who rely on municipal services despite living beyond municipal limits.
According to the study, municipalities with larger fringe populations tend to spend more per resident on several key services, including police and fire protection, recreation and cultural programs, and social and family services.
Researchers found these municipalities generally face higher service costs even after accounting for other factors that can influence spending.
The findings support concerns long raised by municipal leaders in Northern Ontario communities are shouldering expenses for people they cannot directly tax.
The report notes this situation can create financial pressures on municipalities, potentially leading to higher taxes for local residents or service reductions. At the same time, residents of unorganized areas may face challenges because they often depend on municipal services while having little or no input into local decision-making.
Author William Dunstan said addressing the issue will require collaboration among municipalities, residents of unorganized areas and the provincial government.
“Municipalities, residents of unorganized areas, and the province should work together to ensure people across Northern Ontario have access to adequate services, pay their fair share for these services, and have a voice in decision-making,” Dunstan said.
The report outlines several possible solutions, including annexing some unorganized areas into neighbouring municipalities or creating a regional government system like British Columbia’s regional districts.
The full report is available on the Northern Policy Institute’s website.
