Council Approves 2026 Operating Budget

On February 17, 2026, City Council approved the 2026 municipal operating budget which will see a modest 3.74% net tax levy increase. 

City Council and Administration approach the annual budgets with a focus on maintaining existing services while also addressing the needs of future generations. Our goal is to ensure residents have access to resources that foster a safe, healthy, and connected community. Each budget details how the City will fund essential services and programs while managing over $1.2 billion worth of critical infrastructure.  

The draft 2026 operating budget was thoroughly reviewed by Council on January 22, 2026.  This review process underscores Council and City Administration’s commitment to evaluating project status in alignment with the City’s long-range plans, including the Three Year Operating Budget and the Ten Year Capital Plan.

Operating budget

Municipal operating budgets have two parts: operating and capital. These parts are interdependent, meaning that decisions about the capital budget will affect the operating budget, and, in some cases, vice versa.

The operating budget covers the City’s normal operating expenses and revenues associated with delivering day-to-day services, such as road maintenance, snow removal, parks maintenance, recreation, culture, library, and fire services. 

The City of Kenora’s operating budget increased by only 0.82% (0.56% for Operating Departments and 0.26% for Capital Contribution).  City leadership and Council worked diligently to minimize costs and keep the budget lean while maintaining existing services and fulfilling provincially mandated external obligations. 

The 2026 operating budget for the City is a total of $49.152 million, including capital expenditures, reserve appropriations, and debt payments. The City requires $35.417 million through general tax levy, 3.74% higher than last year.

The tax levy is the City’s most significant funding source, representing 72.4% of the City’s combined operating revenues, with a Provincial operating grant contributing $3.765 million.

78% of the net tax levy increase is due to increases from external organizations, for which the City is mandated by provincial regulations to pay. The external organizations include Ontario Provincial Police (OPP), Pinecrest Home for the Aged, Kenora District Services Board (KDSB), and Northwestern Health Unit (NWHU).

Capital budget 

The capital budget allocates funds for the purchase, construction, repair, and the renewal of key assets such as roads, bridges, equipment, and major infrastructure projects. The capital budget is funded through property tax levy, debt, government grant funding, and reserve funds.

The capital budget includes several critical projects that improve our community. Planned Capital investment for 2026 is $6.168 million, with a five-year projected amount of $57.769 million.

Unlike the utility budgets, which is supported by user rates, the capital budget uses property tax levy, government funding, reserves and debt to fund the budget.

The 2026 capital and utility budgets (solid waste and water/wastewater management), were approved on December 16, 2025. The adoption of the 2026 capital budget contributes only a 0.26% increase of the net tax levy, which is 0.9% less than the 2025 increase. Further discussion will occur in conjunction with the 2026 Municipal Operating budget on the net tax levy impact.

2026 projects

The 2026 budget prioritizes key investments in the core services and infrastructure that our community relies on, ensuring we maintain existing services while addressing future needs. A significant capital investment of $13,500,031 is planned for 2026, focused on enhancing our infrastructure and services.

Here are some key projects that will have a significant impact:

• Road paving: $2,060,000 for paving municipal roadways, including Sixth Street South from Fifth Avenue South to Seventh Avenue South, Sixth Avenue South from Fifth Street South to Sixth Avenue South, and Fourth Avenue South from Fifth Street South to 100m south. $5,344,376 for Lakeview Drive Winnipeg River East Bridge to Winnipeg River West Bridge and enhancing Parsons Street and Minnesota Street intersection.
• Rural road enhancements: $576,000 to improve both hard surface and loose top roads, ensuring better connectivity for residents.
• Water and wastewater program: $3,800,000, we’re enhancing vital water and wastewater services, including at Mellick Avenue from Ninth Street North to Tenth Street North, and the laneway between Third Avenue North and Fourth Avenue North, and Seventh Street South and Fifth Street South.
• Wastewater Treatment Plant upgrades: $800,000 in mechanical and electrical works, as part of a capital needs assessment that will see continued upgrades at the Wastewater Treatment Plant. Additional allocation of $450,000 to replace the Screw Pump Electric Generator a critical part of the Wastewater Treatment Plant. 

Thank you to Hon. Greg Rickford and the Province of Ontario for funding in the amount of $5.2 million, through the Province’s Health and Safety Water Stream. This funding helps to significantly offset the cost of replacing the most critical treatment equipment components that have reached end of life at our Wastewater Treatment Plant.

• Water Treatment Plant: $435,000 to an Air Scour Compressor at the plant supporting the ongoing reliable water filtration process.
• Fire vehicle replacement: $1,144,000 in Fire Service with a replacement Pumper Truck.

The City will continue to seek out opportunities for improvement to deliver more efficient services alongside strong customer service. Council will continue to advocate to other levels of government for the need for investment in critical infrastructure in our community that cannot continue to be burdened on the local taxpayers. 

We recognize City administration for their collaboration with Council in shaping an operating budget that maintains services, strengthens Kenora, and supports Kenora’s future needs.

Media contact

Ryan Marsh, Director of Finance, City of Kenora
rymarsh@kenora.ca