Mayor Valérie Plante is facing tough questions after raising taxes beyond what she had promised during the election campaign.
Her administration's budget, she said, will allow the city to catch on "decades of under-investment in our infrastructure and our road and public transportation networks."
To help pay for the upgrades, taxes to homeowners are going up an average of 3.3 per cent when taking into account increases to both the property tax rate and the water tax. The latter tax is going up for the first time since 2013.
Commercial property taxes are also going up an average of three per cent when considering the water tax increase.
The owner of the average Montreal home, valued at $427,500, will see their tax bill rise to $3,729 — an increase of $118 over last year.
During last fall's election campaign, Plante had promised she wouldn't raise the property tax rate above inflation, which is expected to be at 2.1 per cent, according to the Conference Board of Canada.
On Wednesday, Plante maintained she hadn't broken her promise.
She said the increase in the water tax was the "responsible thing to do," and should be seen as separate from the property tax increase, which averages 1.9 per cent.
The additional revenue from the water tax will go toward upgrading the Montreal's deteriorating water pipes, sewer lines and treatment plants, which had a maintenance deficit of $3.5 billion in 2017, according to the Plante administration.
The borough of Rosemont—La Petite-Patrie will see the highest tax increase, up 5.6 per cent, while LaSalle will see the lowest increase at 0.7 per cent.
Last year, under former mayor Denis Coderre, residential property taxes went up an average of 1.7 per cent, while commercial property taxes increased 0.9 per cent.
Where is your money going?
The 2018 budget totals $5.47 billion, up 5.2 per cent from last year.
Plante called it a "transition budget" in attempt to move on from the previous administration.
She said it is meant to build on "tomorrow's Montreal," putting a focus on economic development, mobility and affordable housing.
Here are a few highlights:
- The money set aside for public security totals slightly more than $1 billion. The increase takes into account the new collective agreement reached with police and firefighters, as well as building maintenance.
- Municipal roadwork gets $138.4 million, including $96.4 million for boroughs.
- Snow removal expenditures total $163.3 million, up $6 million.
- An increase of $27.7 million in contributions to the Autorité régionale de transport métropolitain, the new regional transit organization.
- There was no money specifically set aside to study the Pink line, a key proposal floated by Plante during the election campaign.
- $30 million toward economic development, including compensation for business owners in construction zones.
- $21 million toward affordable housing, including $1 million earmarked for inspectors for unsanitary housing.
- Recreation and culture-related activities will receive an additional $9.8 million.
Tax increases will hamper development, opposition says
Lionel Perez, leader of the opposition at city hall, said the Plante administration broke one of its "main electoral promises" with the tax increase.
Perez said higher taxes are going to make it more difficult to attract and retain families in Montreal, and demonstrates how the Plante administration is "disconnected" from the challenges facing small businesses.
The Chamber of Commerce of Metropolitan Montreal also expressed concern about the increase in the property tax rate, saying it "is obvious that this increase harms the business environment and reduces the attractiveness of the city for businesses."