Budgets and Finances

The 2026 budget process was shaped by Council priorities outlined in the Strategic Plan. More specifically, staff were directed by the Mayor to prepare a proposed balanced 2026 annual budget based on the following:

1. the City’s annual operating budget reflect a property tax levy for agencies and boards that is separate from municipal services, prior to preparing the 2026 budgets;
2. prepare an operating and capital budget for municipal services based on a property tax increase that is among the lowest of the other large cities in Ontario, and that the increase is no higher than 2.5%, including 1% capital levy;
3. prioritize repair of City roads by including an additional $15 million in dedicated funding in the capital budget, thereby increasing total spending on road repair from $60 million to $75 million in 2026;
4. continue to make further investments in housing solutions, with funding in the capital budget of up to $10 million and operating funds to support new transitional housing and subsidized housing projects;
5. prioritize investments to improve safety, security, and cleanliness in City parks, the downtown core and other public spaces in the community, as well as strategic investments to improve the city accessibility coordination and support for services and programs;
6. include new resources to help facilitate business investment in the City, recognizing that given the uncertain economic outlook both locally and nationally, it is critical for the City to make it easier and faster for businesses to make new capital investments that bring new jobs and prosperity to Kingston;
7. include the necessary debt financing in the City’s long-term capital planning, with existing budget parameters, to enable the construction of a new pool facility at the INVISTA Centre starting in 2027;
8. review existing City services as necessary to identify efficiencies and potential opportunities to redirect fund from areas that do not maximize value for taxpayer dollars or are not aligned with City Council’s current 2023-2026 strategic plan, towards initiatives noted in this budget direction;
9. pause the annual incremental levy increase for the Green CIP program of 0.16% for the 2026 fiscal year as the program continues to have sufficient capacity with the $400,000 currently levied on a yearly basis; and
10. prepare a report and a draft 2026 annual budget to be presented by the Mayor to Council for consideration before February 1, 2026.

Budget planning is a collaborative effort between residents, council, and city staff. 

• Resident input: Starts through community engagement to help council set our strategic priorities and service levels and continues through an annual budget engagement process, which gives residents the opportunity to provide input on the actual budget. 
• Council directives: Mayor and council provide direction on strategic priorities, service levels, and fiscal guidelines. 
• City staff: Our departments develop work plans and budgets to outline how they will achieve council priorities and support municipal programs and services.

Operating funds are transferred to reserves and reserve funds to set aside monies to fund expenditures, similar to having personal savings accounts.

Capital reserve funds are used for capital expenditures by using:

1. A pay-as-you-go method, where we take money from the reserve funds to pay for capital costs directly; or
2. Through the issuance of debt, where we borrow money to pay for the capital costs and then use the reserve funds to pay future debt principal and interest charges

Reserve and reserve funds are also used to manage unanticipated expenses and to support the City’s long-term financial stability.