Budget - Capital Financing and Other Financial

With the 2025 budget, staff identified that there would be insufficient funding available for capital requirements for 2026-2029 and recommended increasing the capital financing policy for 2026 and 2027 budgets. As a result, council approved an increased capital financing policy of 2% for 2026 and 3% for 2027. The 2026 budget includes this increased capital financing which adds $4.55 million to the operating budget. 

Highlights

Debt and Capital Levy

The $3.1 million Capital Levy provision represents the amount of money raised in the 2026 Operating Budget to directly finance the 2026 Capital projects. Additional details are provided in the 2026 Capital Financing Supplementary Information section of the Budget Book. 

The $23.8 million amount for 2026 for Tax Supported Debt Charges represents principal and interest to be paid on tax supported debt that has been issued, or that may be issued during 2026 from current or previous years’ approvals. Tax Supported Debt Charges exclude debt service payments recoverable from other non-tax sources such as Development Charges, Court House lease payments, Arena user fees and the Wastewater Reserve Fund.  

The Capital Financing Plan, approved by Council based on Report CPFS12-011 and updated with Report CLSFS21-024 and CLSFS23-033, is intended to address the need to move forward with much needed capital works. For 2026, the increase for additional capital financing through the Capital Financing Policy is at 2.0% as approved by Council with the 2025 budget. At the same time, the capital financing for 2027 was approved to be 3%. 

Transfers to Reserves and Reserve Funds

A $1.9 million portion of the 2026 regular Capital Levy is being transferred to the Capital Levy supported Flood Reduction Master Plan Reserve (FRMP) to fund specific FRMP Capital projects. A $4.3 million amount raised through the Stormwater User Fee, new in 2025, is being transferred to the Wastewater Reserve Fund to fund stormwater Capital projects.

This represents the $0.62 million allocation for 2018, 2019, 2020, 2022, 2023, 2024, 2025 and 2026. In 2021, there was a one-time reallocation of the $0.62 million to tax supported debt.  

COPHI Dividend

This dividend is used to bolster the annual capital levy provision. For the 2026 budget, the amount is estimated at $4 million.  

Legacy Fund

The proceeds from the sale of PDI assets to Hydro One were used to establish a Legacy Fund. The 2026 budget includes $1.5 million of the investment income earned on the Legacy Fund to be used to support the capital budget. 

Casino Gaming

Casino revenues have continued to rebound after the pandemic and the 2026 budget includes $2.5 million of funding from OLG based on actual receipts in 2025. The Casino revenues are contributed in their entirety to the Casino Gaming Reserve to fund various capital projects as approved by Council.