Budget and Finances

The Capital Budget includes summary listing by function and the capital project detail.

The City of Kenora Capital Budget consists of a 2026 investment of $6.168 million and 5-year plan of $57.769 million, excluding Solid Waste and Water and Wastewater. The Net Tax Levy allocation to capital is $1.355 million.

Reserves are used to stabilize and fund annual capital expenditures. The City has established a number of reserves and reserve funds for specific purposes. 

View the 2026 Capital Budget.

Water and Wastewater and Solid Waste utility operations do not form part of the overall City budgets, although they have been included with City operating and capital budget. The Utility operations are independent and self‐supported through user fees and do not impact the tax levy.

View the 2026 Utility Budgets.

The Operating Budget consists of the City services categorized in functions including a description, three-year budget and actuals by major account categories, full-time equivalent, revenue and expense variance explanations, and sub services within the function. The Operating Budget Summary provides the total Tax Levy required and the corresponding Tax Levy Impact as a percentage of prior years’ Budgeted Tax Levy.

The 2025 operating budget has total operating expenditures of $46.556 million including capital expenditures (tax supported amount), reserve appropriations and debt payments.  The summary highlights budget decisions and provides explanations for the changes from the 2024 Adopted Budget to the 2025 Budget.

The City will require $33.853 million through general Tax Levy, the Tax Levy is the City’s most significant funding source, representing 72.6% of combined operating revenues. The Provincial operating grant is $3.362 million.

View the Operating Budget starting on page 16 of the 2025 Adopted Budget.

The City budget includes the functional costs with the external organizations representing the largest portion followed by Transportation and Recreation.

External organizations are:

• Ontario Provincial Police
• Northwestern Health Unit
• Kenora District Services Board
• District of Kenora Home for the Aged

There are transfers to other external organizations, Kenora Handi‐Transit, Kenora Public Library, and The Muse (Lake of the Woods Museum and Douglas Family Arts Centre). The budget allocations are at the discretion of the City of Kenora.

View the Net Program Cost and External Organizations on page 11 of the 2025 Adopted Budget.

The total approved operating expenditure budget for 2026 will be determined once the 2026 Operating Budget is adopted. 

This budget funds the City's programs and services, maintains and improves infrastructure, and covers uncontrollable costs such as insurance, fuel, utility rates, and provincially and federally mandated fees to essential external organizations. The City Council and Administration prioritize maintaining existing services while addressing future needs, ensuring residents have access to resources for a safe and connected community.

The 2026 budget is centered on maintaining existing levels of service and programs, as well as preserving essential infrastructure. Our primary aim is to ensure that residents have access to resources that promote a safe, healthy, and connected community. We are committed to sustaining the services and programs vital to our community while also addressing the needs of future generations. The budget outlines how the City will fund these essential services and manage over $1.2 billion in critical infrastructure.

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. Our goal is to provide residents with resources that promote a safe, healthy, and connected community. We are pleased to announce a significant capital investment of $13,500,031 for 2026, focused on enhancing our infrastructure and services.

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

Road paving: We are allocating $2,060,000 for paving municipal roadways (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) 

We’re also investing $5,344,376 for Lakeview Drive Winnipeg River East Bridge to Winnipeg River West Bridge and enhancing Parsons Street and Minnesota Street intersection (scope amended in 2025 and supported through the Provincial Housing Enabling Core Servicing Stream).

Rural road enhancements: An investment of $576,000 to improve both hard surface and loose top roads, ensuring better connectivity for residents.

Water and wastewater program: With a budget of $3,800,000, we’re enhancing vital water and wastewater services (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: We're investing $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.

Water Treatment Plant: An allocation of $435,000 to a Air Scour Compressor at the plant supporting the ongoing reliable water filtration process.

Fire vehicle replacement: Investment of $1,144,000 in Fire Service with a replacement Pumper Truck.

The City is committed to investing in our community through a 10-Year Capital Investment Plan exceeding $200 million, which encompasses essential utilities and infrastructure improvements.

Notable future projects include:

Water and wastewater redundancy: Planned for 2029, this project will enhance our infrastructure with a $20,290,000 investment, ensuring reliability in our water and wastewater services.

Water and Wastewater Treatment Plant upgrades: We will invest a total of $49,600,000 over the next 10 years in essential upgrades to our Water Treatment Plant, commissioned in 1980, and the Wastewater Treatment Plant, commissioned in 1979 and currently 47 years old.

Details to follow once the 2026 Operating Budget is adopted.

In preparing the 2026 budgets, we faced several challenges, including:

• Increased fees to essential external organizations, for which the City is mandated by federal and provincial regulations
• Uncontrollable costs related to insurance, fuel, utility rates, and repairs for fleet vehicles and equipment
• Municipalities face significant challenges in funding capital projects due to limited revenue sources and increasing demand for services.
• Ontario municipalities are still using 2016 property values for taxes because property reassessments were delayed during COVID-19. Since 2022, municipalities and others in the business community have called for regular assessments to ensure fair tax distribution based on current values.
• Inflationary pressures
• Geopolitical instability

It's important to note that Kenora is not alone in facing these challenges. Municipalities everywhere are grappling with increasingly complex issues, such as homelessness, climate change, uncontrollable costs, inflation, rising interest rates, and labour shortages, while lacking an increase to revenue sources to effectively address them. 

City Administration and Council have dedicated significant effort to lessen the financial impact on taxpayers. We recognize the challenges residents are facing post-pandemic, compounded by rising inflation and living costs. To address these issues, we have focused on identifying cost-saving measures and exploring alternative funding sources, aiming to minimize the impact on the residential tax rate while ensuring future sustainability.

Municipalities primarily generate revenue through property taxes and by applying for provincial and federal grants. Additionally, they raise funds through various means, including user fees (such as water bills), and licenses and permits.

Provincial and federal grants play a crucial role in financing capital projects. These collaborations enhance municipalities' ability to undertake significant infrastructure improvements.

It's important to note that securing these funding initiatives requires substantial administrative effort, and their availability can vary from year to year.

As of 2026, municipalities in Ontario are still using property assessments from January 1, 2016, for tax calculations, with no indication from the province on when a new assessment will take place. Property assessments for the 2025 property tax year will continue to be based on fully phased-in January 1, 2016 current values (Municipal Property Assessment Corporation).

This delay, worsened by COVID-19, impacts economic competitiveness and creates uncertainty for both businesses and residents concerning future tax liabilities. Additionally, it limits the potential revenue that could be generated from a current and accurate assessment, which is essential for municipalities to fund the maintenance and improvement of infrastructure, services, and programs.

Between 2016 and the present day, Canada’s other nine provinces will have reassessed property values more than six times on average, emphasizing the need for Ontario to return to a regular assessment cycle to ensure fairness and equity in the taxation system (Association of Municipalities of Ontario).

Ongoing uncertainty around infrastructure funding, coupled with evolving municipal responsibilities and rising costs, threaten municipalities' ability to make informed long-term budget decisions. As municipalities begin their annual budget planning, these factors significantly impact their financial outlook and service delivery capabilities.

Recent economic instability unprecedented inflation put pressures on municipal budget, just like homeowners (e.g. increase in vehicle, building materials) not immune to those increasing, managing those best we can.  responding as best we can to external and internal pressures. Those pressures felt by residents are also felt by the City of Kenora.