Strategic reserve funds dropping from $200 million to $9.5 million could mean a tax hike in Brampton

Brampton Mayor Patrick Brown speaks to reporters flanked by members of the city council on December 12, 2023.

Brampton’s strategic reserve funds have fallen by $190 million, to less than $9.5 million over three years, with some of that spending going on projects that would normally benefit the province.

The figures come from a report to council in May showing the status of Brampton’s $200 million strategic reserve fund, which was set aside in 2021 following the sale of Brampton Hydro.

Council initially planned to maintain funding, but the report shows the reserve was depleted to less than $9.5 million by the end of 2023.

Major expenditures include $40 million in real estate purchases, $7.3 million on the Algoma University expansion and more than $27 million on the new Toronto Metropolitan University Brampton School of Medicine.

A 2023 report to council said any spending on the TMU school posed a risk “that could lead to future pressure on tax rates.”

Post-secondary spending is a provincial responsibility – an area the report shows Brampton has already spent significant money in recent years. The city also donated the $48 million Bramalea Civic Center to TMU for the new medical school, leading to the eviction of the Chinguacousy Library branch.

The council said the council has “actively used these funds for their intended purpose, rather than allowing their value to be eroded by inflation,” according to a report from the CBC.

Brampton Mayor Patrick Brown implemented a property tax freeze after he was elected in 2018 — a move that has led to lower bills for residents at the cost of less revenue for the city. The freeze was lifted in 2023 and property taxes could see a spike amid dwindling reserves and the province’s plan to shift key services from the region to municipalities.

Brown and the city boast that the school is expected to create more than 7,000 direct and indirect jobs in the Peel region, and could also generate between $1.2 billion and $2.6 billion in economic activity over the next decade.

The reserve report shows the city wants to replenish the fund to an “uncommitted” balance of more than $62 million, but no plan has been proposed by the City Council to achieve that goal.

The report also shows that the city’s other reserve funds had a balance of $583 million ($1.2 billion of which $687 million was “offset by commitments”). The city has also received $114 million from the federal government through the Housing Accelerator Fund.

Requests for comment sent to Brown and the city regarding the strategic reserve fund were not immediately returned.

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