Mixed reviews on the budget.(NEWS)

With major tax reform, billions in infrastructure dollars, an increase in the minimum wage and the harmonizing of sales taxes, the 2009 Ontario budget is getting mixed reviews.

"From a municipality point of view we are pleased," said North Bay. Mayor Victor Fedeli, explaining the province matched federal stimulus dollars previously announced.

The Ontario budget sets aside $32.5 billion for infrastructure developed including roads, hospitals, schools and social housing.

"As long as North Bay gets our fair share.".

Funding should be distributed expeditiously based on a project's merit, he said, and it is important for the initiative not get mired in politics.

Fedeli highlighted four "shovel ready" projects that will be submitted for government funding; $7 million in upgrades for McKeown Avenue to facilitate commercial development, $3 million project on Front Street for an 18-unit townhouse complex, $3 million for a street light green energy project, and a sports complex. On the downside is the harmonized sales tax, Fedeli said. "I personally agree with a harmonized tax, but I think the timing is off."

The switch should have taken place in smoother economic times, he said.

"Putting it in when people are out of work and there is nothing but uncertainty in the national economy, it's the right move, wrong time," Fedeli said.

In simple terms the harmonized tax means eight percent on all homes, that's $32,000 on a $400,000 home, he explained.

"In the heyday an extra $32,000 wouldn't have mattered, but now every penny counts."

The city is thankful the harmonized sales tax will be revenue neutral for municipalities, Fedeli said.

"That's something we needed to hear because it would have been an extra $4 million in payments on our capital budget alone."

The harmonized tax was also a miss for the Canadian Federation of Independent Businesses(CFIB), said Ontario vice-president Judith Andrew explaining that the lack of consultation caught the Ontario business community by surprise.

"We're starting behind the goal line. There's a lot to be done to educate businesses on how it will affect them," she said.

Overall, the budget gets a mixed review from the CFIB, Andrew said. "There are some things we give them an 'A' for and others a 'D' or an 'E'"

The best news in the budget is knowing "taxes will be going down over the next two years," Andrew said.

However, the government is taking dollars away from business with the other hand, Andrew said.

"The increase in the minimum wage (to $10.25 by 2010) comes out of the pocket of business," she said. "We thought it was a negative thing in the current economic climate."

There is very little in the budget to "weather the storm," Andre said.

Most of the budget is geared towards 2010, she said. "The government would argue infrastructure projects are stimulative, but it's very hard to get shovels in the ground right away"

The Ontario forestry sector had a major stake in the 2009 budget. The entire industry breathed a "collective sigh of relief" on March 26, said Jamie Lim, president and CEO of the Ontario Forest Industries Association.

"We were concerned about the 2009 budget year and the tough decisions the provincial government would be faced with," she said.. "We could ask for the moon because there is a lot we need and could ask for," she said. "But now is not the time to ask for more, but to ask the government to maintain the programs already in place."

By JAMES NEELY

Northern Ontario Business

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