Richmond Hill council is confronting an uncomfortable paradox: the city’s books are currently in good shape — but its financial trajectory may not be.
A Financial Master Plan prepared by Hemson Consulting Ltd. and presented by Craig Binning indicates that the City of Richmond Hill is not in debt and remains financially stable for now. That finding echoed a recent analysis by Strong Towns Richmond Hill, which, using the Strong Towns Finance Toolkit, had similarly concluded the city is not facing an immediate fiscal crisis.
The report’s tone, however, appeared to catch the mayor and several councillors off guard.
While the city’s current position is “OK,” the modelling warns that maintaining the existing pace of spending will create significant structural gaps in the years ahead. Without adjustments, future budgets could face mounting pressure.
$200M in New Parks Spending Questioned
Among the most visible flashpoints was roughly $200 million earmarked for new parks projects. Some members of council raised the possibility of slowing, phasing, or reconsidering portions of that spending as part of a broader effort to rein in capital commitments.
The report also flagged a potentially catastrophic external risk: a provincial decision to eliminate Development Charges for new infrastructure. Such a move would significantly erode a major revenue tool municipalities rely on to fund growth-related costs.
Tax Hikes or Borrowing?
Council explored possible responses to future revenue shortfalls.
One option discussed was increasing property taxes. Several councillors pushed back strongly, arguing residents are already stretched by high mortgage payments and cost-of-living pressures. Asking homeowners to shoulder additional tax increases, they said, would be unfair.
The Deputy Mayor raised another structural concern: the vast majority of Richmond Hill’s property tax revenue comes from residential properties, leaving the city heavily reliant on homeowners rather than commercial or industrial assessment.
Borrowing and debt financing were discussed at greater length. Strategic debt financing is now formally included as part of the city’s long-term financial sustainability framework. Councillors examined tools such as bond issuance, although it was noted that Richmond Hill does not have the ability to issue bonds directly.
Some members asked whether reserve funds could be used to avoid taking on debt. Binning responded that Hemson’s financial modelling already accounts for reserve usage, and even with reserves factored in, debt appears unavoidable if current spending levels continue.
Councillor Shiu floated the idea of leveraging artificial intelligence to help solve the city’s financial challenges. Binning responded that such technological solutions were beyond his personal expertise, though he acknowledged AI tools are used within his firm in preparing analytical reports.
Council Endorses Strategic Direction
Despite the sobering projections, council ultimately received the report and endorsed a strategic direction aimed at long-term sustainability.
According to the meeting minutes, council:
- Received staff report SRCFS.26.002 regarding the Financial Master Plan.
- Received the Financial Master Plan prepared by Hemson.
- Approved a strategic direction that includes:
- Continued refinement and prioritization of major capital investments;
- Strengthened financial management through enhanced reserve and reserve fund policies;
- Consideration of prudent debt financing within future capital budgets;
- A gradual increase of the Capital Asset Sustainability (CAS) levy toward a 3 per cent target over time to balance infrastructure needs with affordability.
Councillors thanked Hemson for shedding clearer light on the city’s financial reality — one that is stable today, but increasingly constrained by long-term infrastructure obligations and policy uncertainties beyond municipal control.
For now, Richmond Hill is not in debt. The debate at council suggests the larger question is how long that will remain true — and what trade-offs residents may soon be asked to accept.