2% tax hike needed to pay for mega-hospital, report says

A 2.19 per cent property tax increase is on Windsor's horizon, after city administration hammered out a tentative deal with the county to pay for the local portion of the region'sproposed$2-billionmega-hospital.

Windsor andEssexCounty have been asked to collectively pay $200 million for the construction, should the provincial government approve the final plan.

Windsor city staff have worked with EssexCounty administration to come up with acost-sharing methodology that will require Windsor to pick up about $108 million of the local bill, while the county pitches in an estimated $92 million.

The city's new CAO, Onorio Colucci, recognizes the tax increase may be difficultfor Windsor residents to handle, considering council's ability to freeze taxes for years.

"This is not something that can be found by savings," he told CBC News. "There's no logical way for us to come up with $108 million within the existing envelope.It would essentially decimate the services."

A city staff report recommends councilraise the funds "by way of a one-time dedicated property tax levy increase of $8,450,000 (2.19 per cent) starting in 2016, which would be reduced to $3,500,000 in 2026 and eliminated in 2028."

While the city will start collecting the money as early as 2016, it won't be transferred to the hospitals until "certification of substantial completion of the underlying project components for which the funds are being transferred, but in no case before Jan. 1, 2026."

In the meantime, the city will "hold and invest" the money in a dedicated reserve fund.

The mega-hospital plan also includes upgrades at Htel-Dieu Grace downtown and a new facility at the site of the former Grace Hospital in west Windsor.