Hamilton mayor pitches 2026 budget that would see average homeowner pay $230 more

Hamilton Mayor Andrea Horwath has put forward a 2026 budget that includes a 4.25 per cent residential tax increase – about $228 for the average home assessed at $387,100.

Now councillors have 30 days to review it and propose amendments before it’s a done deal.

At a city hall press conference on Tuesday, Horwath said staff were able to get the tax increase down to 4.25 per cent, the rate she set in October as a target.

She said that amount would allow the city to continue investing in infrastructure and avoid big cuts, while also being mindful of the financial pressures a bigger tax increase would put on many households.

"Holding the line doesn't mean doing less. It means making disciplined, thoughtful choices, choices that meet the needs of today while continuing to fuel Hamilton's momentum," she said. 

The budget increase being proposed is lower than the increases of the past two years, with 2025 seeing a 5.6 per cent tax increase, a reduction from 5.8 per cent in 2024.

This year’s tax increase was initially forecast to be 8.5 per cent, a number proposed during last year’s budget deliberations. Staff increased that to 8.9 per cent in September in a budget outlook report.

By December, staff had whittled that number down to a projected 5.5 per cent tax increase for 2026.

The increase now on the table, 4.25 per cent, represents a tax levy increase of $70.8 million of a total tax-funded budget of $2.9 billion. Of that, $1.3 billion would come from property tax payments, according to the city. 

New money to city-funded boards and agencies would account for a 1.2 per-cent tax increase, including $239 million more than last year for the Hamilton Police Service, an $18.6 million increase to the Board of Health and a $40 million increase to the Hamilton Public Library. 

The proposed tax budget dips into city reserve funds less than it did last year, aiming to use $34 million this time compared to $63 million in 2025.

Where did staff find savings?

The mayor said the city will see slightly more money coming from user fees, and from interest on its reserve funds, and also found savings in the way it budgets for projects, including reallocating funds from where they were no longer needed.

According to a report that will come before councillors at Friday's General Issues Committee budget meeting, the first of several budget-specific meetings over the next few weeks, the city is adopting a “revised financing approach that supports affordability by leveraging surpluses from capital projects and phasing capital investments over multiple years without jeopardizing completion or operationally-required delivery dates.”

It will also defer repayment of loans from the Hamilton Future Fund for 2026.

“City departments undertook a comprehensive line-by-line review of their 2026 budgets to identify cost-saving or revenue generation opportunities,” says the report, saying this exercise produced about $24.7 million in savings.

“These actions include adjusting budgets to reflect current cost realities, such as reduced fuel expenses due to pricing and carbon tax changes.”

Big investments include paramedic station and HSR garage

Horwath said the budget continues funding to tackle the city’s infrastructure deficit. Last year, city officials said the difference between money needed to maintain city roads, buildings and other property and what has been allocated was somewhere between $3.18 billion and $7.42 billion.

Horwath said council has since worked with staff to establish an asset management plan to close that gap. 

"When investments are not made over a number of years, then eventually, the piper has to be paid,” she said. “Wouldn't it be terrible for us to do the same thing that we got stuck with as a council?”

Investments in the proposed budget include:

• $124.7 million for roads, bridges, sidewalks and traffic signals.
• $116.3 million to facilitate the completion of a Hamilton Street Railway maintenance and storage facility and additional fleet vehicles.
• $49.7 million in technology following the 2024 cybersecurity incident. 
• $33.9 million to acquire new park land.
• $21.1 million to expand the Macassa Lodge B-Wing. 
• $10.1 million to build a central reporting station for paramedics.

What happens next

As dictated by the strong mayor powers afforded to Hamilton’s mayor by the province, Horwath is required to put forward a budget draft by Feb. 1 of the budget year. Council then has 30 days to propose and vote on amendments.

The mayor then has 10 days to veto amendments. If she does so, council can override her veto only with a two-thirds majority.

Following this timeline, the budget will be adopted sometime in February or March.

Newly elected councillor Rob Cooper, who replaced John Paul Danko in Ward 8 after a byelection in September, says the strong-mayor system can make it feel like there’s not much left within a councillor’s control.

“The way the strong mayor powers have been set up is that unless you're the strong mayor, you actually can't influence the budget,” said Cooper, who ran on keeping property-tax increases at a similar rate as inflation. Canada’s Consumer Price Index, a widely-used inflation measure, was at 2.4 per cent in December. “We're on the sidelines."

Cooper is weighing a run for mayor in this fall’s election, and says he will decide based on how the budget process goes. 

“I'm happy to put in speed bumps in if we need them,” he said. “But my goal in being [on council] is not to do speed bumps.”