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County adopts 2026 budget after last-minute OPP cost hike

Prince Edward County Council formally adopted its 2026 operating and capital budgets last week following a late change to provincial policing costs that added unexpected pressure to the municipality’s finances.

Mayor Steve Ferguson officially signed the 2026 budget last Tuesday night, marking the end of a process that was largely settled in December, but was reopened after the province subsequently announced an 11 per cent increase to the Ontario Provincial Police budget — nearly double the six per cent increase municipalities had been anticipating.

The OPP hike translated into roughly $390,000 in additional costs for the County. The increase, however, was announced after Council had completed budget deliberations in December.

Before the OPP adjustment, the proposed 2026 tax-supported budget required a municipal tax levy increase of 5.32 per cent. Absorbing the higher policing costs would have pushed the increase to 6.08 per cent.

Rather than revisiting the budget line by line or increasing the tax rate, Council and staff proposed an alternative approach. It would instead reach into reserves and spend refunded cash from the dissolution of the regional recycling board. Specifically, Nieman proposed taking $143,500 from the climate action reserve, $150,000 from the Municipal Accommodation Tax (MAT) reserve, and nearly $97,000 from the newly-created waste diversion reserve.

Interim CAO Adam Goheen said that the tax stabilization reserve would normally be used to offset an extraordinary cost of this nature.

“That reserve, which should have millions of dollars, is almost empty,” said the CAO.

Councillor Chris Braney wanted his Council colleagues to explore alternative solutions to offset the increase in policing costs.

“I can get my head wrapped around the concept,” said Braney. “My concern is that we are always dipping into reserves. Had we known about this 11 per cent OPP budget increase, I believe we may have made some decisions when we were in our closed session [at budget] that would have negated some of these costly scenarios.”

Councillor Phil St-Jean agreed, but said he could ultimately support the motion.

“I think I have been clear over many years that we need to maintain and enhance our reserves,” said St-Jean. “Having said that, we are in a bit of a situation here where we need to find $390,000 for this year. I do not like to draw from reserves, and I do not want to set a precedent. However, I think as a stop-gap measure. I think this is the right thing to do.”

Councillor Bill Roberts agreed.

“Two things can be true at the same time. We are in a sticky situation. It will definitely have to be a one-time deal. We can’t keep draining reserves,” he said.

Mayor Ferguson described the use of reserves as “a reasonable compromise,” adding that it was preferable to reopening the budget process at such a late stage.

Mayor Ferguson said, too, that formal approval of the budget was required to allow the County to move forward on several capital projects, issue more than a dozen tenders, and meet a range of legislative and operational deadlines.

The final 2026 budget was adopted by a mayoral decision on January 13, 2026, using authority provided under provincial legislation. The decision finalized both the operating and capital budgets and allows the County to proceed with its financial plan for the year.

While the approach avoided an immediate tax increase, the decision highlights the County’s growing reliance on one-time reserve funding to manage ongoing cost pressures. With the tax stabilization and climate reserves now effectively depleted, council has fewer financial buffers to absorb future shocks. It leaves the municipality increasingly exposed to senior government decisions made outside its control, raising questions about the long-term sustainability of relying on reserves to balance annual budgets.