No Matter the Issue, It's all about the Money

Growth, new investment, business attraction, and the renewal of aging infrastructure are priorities every candidate in this election identifies as essential. I agree. These are critical issues Sarnia City Council must confront.

But in every election, long‑range promises often overshadow the practical steps required to achieve them. Many candidates describe the destination. Few address the journey.

That journey begins with the city’s finances.

Sarnia’s approved 2026 budget includes a $196.4 million operating plan with a 4.21% increase to tax‑supported expenses, and $65.5 million in capital spending.

Although taxes rose, council relied heavily on withdrawals from our shrinking reserve accounts to soften the impact. Over this council term, more than $30.2 million has been taken from reserves to avoid higher tax increases. In the 2026 budget, $8.2 million has been allocated from reserves to that end.

Reserves are complex, but their purpose is straightforward: they provide stability. Operating reserves cover unexpected costs such as severe‑weather overruns or emergency responses. Capital reserves fund major projects: roads, sewers, facilities, and fleet purchases, reducing the need to borrow.

Using reserves occasionally to ease tax pressure is understandable. Using them routinely is not. Long‑term depletion of reserve accounts is a poor strategy and contrary to their intended purpose.

Sarnia’s $30.2 million in tax‑offset draws over a single council term is unusually high and widely considered risky. The City Treasurer has already warned that the capital reserve will be severely depleted by the end of 2026, creating a significant shortfall and effectively necessitating a major tax increase in 2027. The next council will face this immediately.

Compounding the challenge is Sarnia’s stagnant growth. While cities such as London, Strathroy, Chatham‑Kent, and Windsor continue to expand and grow, Sarnia remains largely flat. With the same number of taxpayers supporting rising costs, aging infrastructure, and expanding service needs, the per capita burden intensifies.

This leads to the most serious financial challenge of all: Sarnia’s annual infrastructure underfunding.

According to the City’s Corporate Asset Management Plan, Sarnia owns approximately $4.6 billion in municipal assets. To maintain them in acceptable condition, the city should reinvest 1.8% of their value each year (about $83.8 million). Currently, we invest roughly $65 million.

That leaves a $19 million annual shortfall. Many cities are operating at similar levels of deficit financing for infrastructure. Sarnia stands out for two reasons: 

• We carry an unusually large infrastructure load for a city our size, driven by our heavy industrial footprint and the systems required to support it.

• No other Ontario municipality has relied on capital reserves the way Sarnia has over the past four years to offset tax increases, a practice that has now left those reserves critically low.

Over ten years, this becomes a $190 million gap, not including inflation, rising construction costs, or emergency failures. The city already reports a $291 million (2025) backlog of known infrastructure work that has been deferred.

This is the definition of an infrastructure deficit: assets aging faster than the city can repair or replace them.

This deficit affects every priority candidates talk about:

·        attracting new businesses

·        supporting growth

·        maintaining roads and sewers

·        ensuring safe neighbourhoods

·        keeping facilities usable

·        preparing land for development

·        modernizing core infrastructure

You cannot grow a city on deteriorating infrastructure. Every goal depends on financial capacity that is becoming increasingly scarce.

When you combine:

·        $30.2 million in reserve draws to soften tax hikes

·        a capital reserve projected to reach zero

·        a major budget shock anticipated in 2027

·        a substantial levy increase projected by the Treasurer

·        a $19 million annual infrastructure shortfall

·        a $291 million backlog (2025 figures)

·        and flat population growth

you get a financial picture that cannot be solved with small adjustments or optimistic promises. These challenges developed over many years, and they will take years to correct.

There is, however, good news. According to BMA Municipal Reports, highlighted in a June 28, 2025 article by Livio Di Matteo, Sarnia had the second‑lowest per capita municipal debt of all reported Ontario cities. Based on 2023 figures, our per capita debt was $24.00. My understanding is that it later fell to $14.00, and with modest borrowing in the 2026 budget, has risen slightly.

The average provincial per capita debt in the study was $913.00. Kingston topped the list at $3,284.00, while Markham was lowest at $20.00. Mid‑sized cities such as Peterborough, North Bay, and Thunder Bay exceeded $1,500. London’s per capita debt was just under $500.00 in 2023 and is likely higher now.

This is a positive sign. Recent councils have worked hard to eliminate debt, unlike many cities that rely on borrowing as a central part of their budgeting and growth strategies. There may be a connection between more assertive use of debt and the growth seen in cities like London.

I submit that while eliminating debt is admirable, pairing it with heavy reserve use to soften tax increases is good for today but compromises tomorrow. We must rebuild our reserves and begin addressing the infrastructure rehabilitation for which we are already behind.

Infrastructure enhancement is a key factor in promoting growth and attracting investment (more on that in a future report).

As a first step in this journey, I believe that given our exceptionally low debt load, Sarnia must consider moderate borrowing and mandatory budget freezes for all departments in the next budget cycle.

Each $1,000,000 in debt equates to about $14.00 per capita in Sarnia. Borrowing up to 7% of a city's own-source revenue (property taxes, fees, etc.) annually is considered safe by municipal standards. A 5% borrowing level in 2027, approximately $5 million, would add about $70.00 per capita, still far below the provincial average. It is not a cure‑all, but it is a responsible step. A five‑year plan using this approach is sensible.

With strategic borrowing, a one‑year departmental budget freeze, incentives to streamline operations, and a more aggressive pursuit of grants and subsidies from upper‑level governments, Sarnia can begin a forward‑looking path toward the goals every candidate is promoting.

Cities cannot build tomorrow’s infrastructure with yesterday’s tools. Municipalities that embrace disciplined, strategic debt, London is a clear example, are the ones where roads are rebuilt, cranes rise, and growth becomes self‑sustaining. Borrowing 5% of our tax levy annually for five years is not reckless; it is prudent. It spreads costs fairly over time, protects reserves, and finally allows us to tackle projects that have been deferred year after year.

This strategy alone will not solve every challenge, but the shift in mindset it represents is an essential first step.

Acknowledging the difficulty of the task should not diminish the ambition to address it. It underscores why a realistic, steady, and transparent approach is necessary.

Sarnia cannot move toward growth without stabilizing its financial foundation and repairing what has been neglected. We cannot attract new businesses without reliable infrastructure. We cannot improve services without addressing the structural issues that limit our ability to fund them.

I am committed to pursuing these long‑range objectives with honesty about the challenges and clarity about the steps required. Success will not come overnight. It will take time, careful planning, a committed and cohesive council, and a willingness to make difficult decisions. That is precisely why the work must begin now, thoughtfully, responsibly, and with a clear understanding of the journey ahead.

Chris Oram

Sources: The Fraser Report: "Municipal Debt Rising substantially for some Ontario Cities'" Livio Di Matteo, Sarnia 2026 Budget, BMA Municipal Reports, Sarnia Observer, Sarnia Journal