The City is responsible for delivering services to citizens and for maintaining infrastructure that is used every day. The money received through sources like property taxes are spent on these services and infrastructure, and also saved in reserves and reserve funds for future spending.
How the City spends money
The City’s services are organized into different areas. Each year, these areas present their proposed budget and objectives to the Budget Committee for review and approval.
The 2021 proposed budget is allocated in the following ways:
In addition to providing services, the City is responsible for maintaining infrastructure. Infrastructure includes equipment and structures owned by the City and used by everyone.
Infrastructure includes roads, bridges, stormwater drains and sewers, sidewalks, streetlights, traffic signals, community centres, libraries, fire stations, pools, arenas, parks, trails, playground equipment, theatres, buses and bus shelters.
Infrastructure must be maintained in order to avoid excessive future repair costs, put safety first and make sure that Mississauga continues to be a great place to live, play and do business.
In total, the City owns about 60% of the total infrastructure in Mississauga, which is worth about $12.4 billion distributed as follows:
The good news is Mississauga’s infrastructure is in pretty good shape. However, it is taking more money to keep it that way. Here’s how the condition of our roads, bridges and buildings looks:
Very good: Infrastructure is in very good condition (typically new or recently repaired)
Good: Infrastructure is adequate, but show some signs of deterioration which require attention
Fair: Infrastructure show signs of deterioration and require attention
Poor: Infrastructure is in poor condition (mostly below standard), with many elements approaching their end of service life
Very poor: Infrastructure is below standard with many elements deteriorating, reaching the end of their service life and require urgent renewal
Reserves and reserve funds are established by Council to assist with long-term financial stability and financial planning in the City.
Reserves and reserve funds are an important element of the City’s financial plan. By maintaining reserves, the City can accumulate funds for future needs or contingent liabilities, a key element of sound long-term financial planning practices.
Reserves and reserve funds provide stability in times of unexpected shifts in revenues and expenditures, provide funding for one-time expenditure requirements, and minimize fluctuations in taxes caused by cyclical conditions.
Credit-rating agencies consider municipalities with higher reserves to be more advanced in their financial planning.
The City maintains operating and capital reserves and reserve funds. See more details of all reserve activity for the City.
The City’s infrastructure is funded from property taxes and other sources like the Federal Gas Tax or development charges. The City is facing challenges to fund the maintenance of infrastructure over the coming years due to something called the ‘infrastructure gap.
The City’s infrastructure is worth $12.4 billion. The annual depreciation expense represents the minimum amount that is required each year to replace infrastructure in the future.
The City is investing $118 million in its infrastructure while the annual depreciation based on historical costs is $137 million. The gap between what is funded and what is needed is $19 million based on historical costs. When the depreciation expense is adjusted to reflect the estimated replacement costs in today’s dollars, it’s $409 million, making the real infrastructure gap $291 million.
Despite help from federal and provincial government, we still need to continue to apply the 2% Infrastructure and Debt Repayment Levy to manage our infrastructure.
Climate change and extreme weather events can add additional pressure to the City’s stormwater management. To help combat this pressure, a stormwater charge was approved for 2016 to increase the City’s investment in the stormwater program.
Due to the COVID-19 pandemic, many City services, facilities and programs were put on hold resulting in a budget deficit. We’re planning our 2021 finances to build a business plan and budget that reflects the needs of the community.