At a November 3rd general committee meeting, Peterborough City councillors received a presentation from Financial Services Manager Richard Freymond summarizing the contents of the 2026 draft budget of the City of Peterborough.

The 2026 all-inclusive tax rate proposed by City staff currently sits at 7.43%, though that number remains subject to change by council in their forthcoming budget deliberations.

The initial draft budget book, which was made available to the press that same morning, featured an increase of the all-inclusive tax rate by 7.84%. In the days since its printing, Freymond explained that unforeseen decreases in the benefit payments of Peterborough City and Police Services staffers, as well as greater financial assistance through the Ontario Municipal Partnership Fund had freed up a total of $933,900, for a revised rate of 7.43%.

Pending the approval of the draft budget, this would take the municipal all-inclusive tax rate to just 0.01% below the staff prediction made last June in a presentation to council.

The all-inclusive tax rate for 2025 was 6.72%, or “$10.44 per month per $100,000 of property assessment for the typical residential property,” according to the approved budget. For the median assessed property valued at $260,000, the 2025 rate translated to roughly $27.15 a month, as opposed to $32.03 a month under the 2026 rate.

Under the original version of the draft budget, the 7.84% all-inclusive rate was comprised of a 3.25% increase related to the City’s operating budget (the cost of maintaining its current service levels); a 2.18% increase increase related to financing capital projects; a 1.88% increase to finance various municipally-funded boards and agencies (including the Peterborough police and paramedics services); and a 0.53% increase related to sanitary sewer fees.

In light of the revelations made by Freymond on Monday night, however, the cost of capital project funding would reduce to 2.93%, and that of outside organizations to 1.79%, leading to the new rate increase of 7.43%.

Of that 2.93% for capital project expenditures, the expansion to the Peterborough police station was by far the largest cost line, with a $23 million total cost for the year—more than twice that of the second largest project, the partial renovation of Lansdowne Street West.

The police service was also among the first named sources of the initial 7.84% rate, with a 9.8% increase to its operating budget directed by Mayor Jeff Leal’s use of strong-mayor powers in May. This increase would take the total police budget for 2026 to $41.5 million—a $3.7 million increase from the previous budget year.

This is comparable to other City-funded external organizations such as the newly-merged Lakelands Public Health unit and Peterborough’s City and County paramedics, which could see a 5% (or $95,602) and 7.3% (or $529,630) increase to their budgets respectively. This would take the Lakelands total budget just over the $2 million mark and the City and County paramedics’ to $7.8 million.

The latter was listed as receiving the second-highest budget increase out of the municipally-funded external organizations in the 2026 budget book, making the police service the highest-funded external group by a margin of over 2%, or more than $3 million, though these numbers are subject to change following the reduction in police service benefit costs.

Also in the 2026 budget book, City staff noted that demands for capital funding “far exceeded the available funds.” Over $70 million had to be cut from the initial capital budget presented by various departments, leading to the deferral of two capital projects for which council had pre-committed a total of over $3.5 million in 2026 to the next year: the redevelopments of the Towerhill-Fairbarn intersection and Otonabee river trail.

During his presentation, Freymond spoke to what the budget book’s authors called “difficult decisions” made about capital budgeting in the preparation of this draft.

“The capital program in the 2026 budget is $140 million. It seems like a lot of money. However, if I was doing the right thing by the community, I could bring forward a capital budget of $250 million,” said Freymond.

Many of these decisions also came in the face of heightened budget increase demands from key departments.

“Paramedics, I had estimated 3%. They’re asking for 7.39. Public health—I had estimated 3%—are asking for 5%,” said Freymond.

Another request weighing on the draft budget this year was $1.09 million committed to funding housing and homelessness programming, part of which was attributed to “increasing cost inflation pressures of programs and service needs in the community, as well as a loss of provincial revenue,” according to the budget book.

Freymond’s presentation also included the mention of possible costs of a 1% reduction in the all-inclusive tax rate, likely following the established pattern of councillors seeking to lower the initial draft budget’s tax rate in previous years.

“If council would like to reduce the number even further, to put that into context, to pull it just 1% from 7.4 to 6.4, that number is $2.27 million of tax supported expenditures,” he explained.

Last year, the expected cost of a 2.8% reduction of the initially proposed rate of 7.8% was included in the budget book with an attached “list of further possible reductions,” including measures such as the elimination of the Trinity drop-in program and the defunding of the Art Gallery of Peterborough, prompting widespread outrage.

These possible reductions were presented as a means of meeting council’s request for a 5% all-inclusive tax rate. Ultimately, the 5% demand was not met, with councillors settling for 6.72%.

Though councillors did not place any similar demands on staff this year, Freymond still thought it prudent to frame the draft budget as a staff recommendation, which will be subject to a “consultative process” throughout this budget season.

This consultation process is set to begin with some informal public consultation meetings on the 5th of November at the Healthy Planet Arena and the 10th at City Hall. Starting on November 17th, councillors will engage in a detailed review and discussion of the draft budget for two days leading up to its ratification.