Montreal property taxes going up

Residential property owners in Montreal will see their property taxes increase by an average of 5.3 per cent in 2010-2011, according to a city budget released Wednesday.

The city presented its $4.3 billion budget Wednesday morning. The highest property tax increase will be in Lachine, which will see a 7.8 per cent increase.

LaSalle is the only area that will see a tax decrease, as rates there will go down by 1.6 per cent.

Montreal Mayor Grald Tremblay said Wednesday that the economic crisis was one of the main reasons the city had to increase taxes. The poor performance of the citys pension plan and the rising cost of public transit, police andfire services, and water infrastructure also contributed to the increase.

"The challenge that we have in the days to come is to convince our citizens that their money will be properly invested to improve the quality of life, and most of that money will be invested in public transit," Tremblay said.

Montreal will use roughly $38 million from its fiscal reserves to balance the budget, something the city is required to do by law.

City to increase transit spending

The city said it will increase spending on public transit, with the Montreal Transit Authority slated to receive roughly $390 million in funding, 17 per cent more than it received last year. The money will be used to upgrade transit service, the city said.

The city said it will also contribute $44 million in funding to help finance commuter train service.

The city also plans on introducing a new tax on non-residential parking lots. It hopes the new measure will bring in up to $20 million in additional revenue for public transit.

Tremblay also said he wants a share of the provincial gas tax to flow to the city. He said if he doesnt get it in the next budget, hell have no choice but to install some toll booths to help cover the citys costs something the opposition has been pushing for.

The city said it will reduce its spending on infrastructure projects while it reviews the management of public contracts at city hall.

Opposition, business owners reject budget

The Tremblay administration is heading in the wrong direction by pairing the biggest tax increase in nearly a decade with a cut in infrastructure investments, said Opposition leader Louise Harel.

"This combination is what will put the brakes on Montreals economic development. It is a mistake," Harel said.

The Vision Montreal Party leader said she had been hoping that rather than increase taxes, the city would go ahead with a plan to implement road tolls.

Business owners expressed concern about the fact commercial property taxes will rise an average of six per cent.

A new tax will also be appliedto non-residential parking lots.

The budget is not aimed at stimulating the citys economy, said Mike Parente of the Association of Commercial Development Corporations, which represents more than 14,000 small and medium businesses in the city.

"It does everything but that," Parente said. "Taxes on the residents, taxes on the business people and there doesn't seem to be any additional services."

Parente is calling on the mayor to scrap the budget and look for new ways to increase revenues.

Demerged municipalities angry

The amountdemerged municipalities pay Montreal for regional serviceswill rise by as much as 13 per cent in the coming year, said Westmount MayorPeter Trent.

That cost will likely be passed on to residents of those municipalities, who will see similar increases in their taxes, Trent said.

"We are all in the same boat right now," Trent said, pointing out the Tremblay administration continues to increaseits spending at a higherrate than inflation."We're all now victims of the same bad management of the city of Montreal."

The demerged municipalities are also willing to work with Tremblay to get more money for public transit from the Quebec government and off-island municipalities, Trent said.