Fort Frances council is staring at what could be one of the largest tax increases in many years.

The operating budget shortfall is $877,736, which equates to a 7.1% tax increase.

Mayor Andrew Hallikas admits it is one of the most challenging budget years he has faced.

“It’s important to note that even before going into looking at the budget, that over 40% of our budget is comprised of expenditure over which we have no control. Indeed, two of our largest budget items are the cost of policing and the levy from the Rainey River District Services Board,” says Hallikas.

He adds the town also pays a levy to the Northwestern Health Unit while dealing with higher costs for things as fuel, insurance, salaries and benefits.

The town has also been impacted by a reduction in provincial transfer payment, money provided to municipalities intended to offset the cost of services and programs under the watch of the provincial government.

“Difficult decisions will have to be made. There are only two possibilities. We can pay for the rise in uncontrollable costs by increasing the tax levy, or we can decrease the cost of services by reducing the services that we normally provide,” says Hallikas.

“Neither option is particularly palatable, and the solution to the dilemma that we face today will likely have to be a combination of a tax increase and some reduction in services.”

Administration already plans some cuts.

The town is holding off on hiring an additional labourer to work at the splash park and area parks during the summer.

The museum will also have to make do with three summer students instead of the five requested.

The town is also cancelling the need for contracted dump trucks to remove snow for the rest of this winter.

Interim Chief Administrative Officer Travis Rob feels administration exhausted all options to reduce costs that would have minimal impact on service levels.

Council would like a further cut and has directed administration to find at least another $100,000 in savings.

“We’re not going to cut 877,000 out of the budget,” says Councillor Mike Behan. That’s impossible. But at the same time, I don’t want to cut nothing either, because I think that’s not right either.

“We have to do our due diligence to try and find some savings, so that we do reduce the tax increase as minimal as possible.”

Behan says he would like an increase closer to the 5 to 6% range.

Some of the suggestions offered by council include reducing the contributions toward asset management plan, less spending on council training and a review of operations at the library, museum, Sister Kennedy Centre and Sorting Gap Marina.

The next budget meeting is scheduled for March 4th.