Norfolk’s 10-year capital budget tops $1 trillion

Norfolk County is facing a daunting 10-year capital budget.

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For the first time in its history, the county’s capital plan is projected to top the $1 billion mark.

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The county is responsible for maintaining a variety of significant capital assets, including roads, bridges, water and wastewater infrastructure, facilities, vehicles and equipment.

Norfolk’s budget committee will begin discussions on the 2024-2033 capital plan on Wednesday. It includes infrastructure investments related to water ($235 million), wastewater ($177 million), roads and bridges ($298 million) and facility needs ($93 million).

Also being considered for approval is the 2024 capital budget of $166.6 million.

“Bringing this budget forward was a challenge for staff,” Amy Fanning, Norfolk’s director of financial management and planning, said in a preamble to the capital budget being considered by the committee. “When the 2020-2029 capital plan was finalized just a few short years ago, the total 10-year forecast was $541 million. This represents an increase of nearly $500 million in four years’ time, as well as the projected exceedance of the county’s internally imposed debt limit.

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“Challenging times are here and it will take many years of difficult decision making to overcome those challenges.”

Factors contributing to the funding challenges for municipalities, said Fanning, are aging infrastructure, asset management implications, skyrocketing construction costs, changing regulations, staffing issues, supply chain challenges, inflation, and interest rates remaining higher than anticipated.

Fanning said the next steps for Norfolk are to “very seriously consider the service levels that are currently provided to the community” to see where efficiencies can be found and improvements made. Also imperative, she said, is that reserve contributions be increased “in a manageable way for the foreseeable future” and pursuing funding from the provincial and federal governments “as persistently as possible.”

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About 58 per cent of the proposed 2024 capital budget is recommended to be funded through debt, “largely resulting from the county simply not having sufficient rate capital reserve balances, grant opportunities, or availability of other sources to fund the rate capital requirements any other way in the short term.”

On the positive side, a report being presented to the budget committee on Wednesday says “difficult decisions made by council over the last several years have remarkably improved Norfolk County’s financial position.”

One of the primary drivers of the 10-year capital budget is $148 million worth of projects that had to be re-budgeted due to lack of funding. The new budgets for the projects represent an $82.5 million increase over the original estimates.

Among the major projects are:

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