in two classes. As well, those savings will continue indefinitely into future years through the carry forward of a much lower base budget than would have otherwise been the case.

Put in more practical terms, had the annual property tax levy increases since 2008 averaged 2% (generally around inflation), property taxes in the City of Windsor would be approximately 24% higher than current levels. A property owner with a home assessed at $163,000 would therefore be paying approximately $700 more annually than what they currently pay.

The noted constraints also apply to the operating budget contribution levels towards the capital projects that build and maintain our infrastructure, which is valued in the billions of dollars. Funding for capital projects has actually increased significantly over the last dozen years. But, as noted, this funding source will also face a decrease in purchasing power without continual and regular increases to combat the impacts of inflation. Administration has been advised that "senior level of government" funding programs will also require, going forward, strong asset planning methodologies to be in place as well as a local financial commitment in order to receive much needed grant funding. Therefore, in order to keep existing infrastructure at sustainable condition ratings, a 1.2% property tax levy increase related to an Asset Management Plan (AMP) is being recommended in the 2020 Budget. Details of the AMP can be found in Report C 198/2019 – 2020 8-Year Recommended Capital Budget included in the 2020 Capital Budget documents.

Administration will of course always continue to look for ways of minimizing any required levy increase in the future. It is possible that as each budget year is reviewed, options that are currently not apparent will be found to hold the line on taxes in that particular year. However, it is clear based on the foregoing analysis and administration's experience of the past decade that it is becoming increasingly difficult to identify service neutral savings targets within existing base budgets.

Based on the 2020 budget as presented, administration is recommending a modest tax increase in order to sustain operations. It is also likely that, in order to continue avoiding significant impacts on services and to achieve the goals set by Council in its 20-year strategic vision document that future budgets will need to continue to reflect, at minimum, the inflationary pressures that can be expected on an annual basis. Furthermore, should council wish to add services or enhance existing services, it would be necessary for dedicated additional funding to be identified.

Risk Analysis:

At its core, a municipal budget is a projection of inflows and outflows for the coming year. Due to the timing of the budget preparation and approval, many of these projections need to be made with less than complete information. Additionally, these projections need to take into account future events and circumstances, which are often out of the control of the municipality. Therefore, as with any budget, there are risk factors associated with the recommended 2020 City of Windsor operating budget. The following is a list of some of the most important of those risks along with related mitigating measures.

1. Impacts of Provincial changes to municipal grants such as OMPF and Social Services could have significant impacts to municipalities and result in significant lost revenue, impacting municipal operations and service delivery. While some planned reductions in provincial funding have been deferred to 2020 and beyond, there still remains a great deal of uncertainty as to what the impacts to municipalities will be