Key investment areas include affordable housing, long-term care, paramedic services, climate action and core infrastructure.
District Council adopted updates to the 2026 Budget earlier this week. The budget confirms Council’s financial plan and keeps the overall tax increase to 3.85%, below the budget guidelines set by Council. The overall budget includes $251.3M of expenditures to deliver programs and services and $112.8M for capital projects.
“This budget reflects financial realities, while still investing in our long-term vision for Muskoka. We have responded to changing economic pressures, prioritized community needs, and made strategic decisions so that the District remains financially strong. The budget makes significant investments in housing, healthcare, climate action, and infrastructure, while recognizing the need to keep taxes down amid rising costs of living.” said Jeff Lehman, District Chair.
What does this mean for taxpayers?
- General programs and services: The portion of the tax increase that supports the programs and services the District delivers will be approximately 2.75%, which is lower than originally planned.
- Police Services: The District is responsible for paying for OPP policing provided within Muskoka. The cost of policing billed to the District increased by $2.4 million for 2026. This increase would have resulted in a tax rate increase of 2.1% for police services alone, however, recognizing the affordability crisis our residents face, District Council has approved phasing in the impact by using reserves to mitigate this increase in 2026 to 0.70%.
- Health Care and hospital projects: About 0.40% of the tax increase will support hospital redevelopment projects within Muskoka and capital investments in other hospitals that Muskoka residents rely on.
- Water and wastewater: Municipal water and wastewater customers will see a combined user fee and tax increase of 3.2% to address rising chemical costs and maintenance plans. The increase is roughly $77/year for an average household.
- Garbage and waste management: The solid waste rate increase is 2.23% on average, but this rate varies by where residents live and the services available in each municipality. Overall, the rate increases are lower than originally expected.
Addressing Community Priorities: Residents shared the priorities that mattered most to them through the 2026 Budget Priorities Survey. Some of the key investments included in the 2026 budget to address these priorities are:
- Housing: $1M to build more affordable housing in communities across Muskoka – part of Muskoka’s Big Move on Housing.
- Long-Term Care: Funding to hire staff to safely open and operate the new 160-bed Fairvern Long-Term Care (LTC) Home.
- Climate Action: A reserve fund to support corporate projects that will make programs and services more energy efficient and more resilient to climate change.
- Paramedic Services: Hiring paramedics and expanding service in Lake of Bays and Huntsville – part of the Muskoka Paramedic Services 10-year Master Plan for more services and faster response times.
Managing Costs: Both staff and Council have made managing costs a top priority to balance financial pressures while keeping services affordable for residents. OPP policing costs, increases to road maintenance funding and asset renewal timelines are being spread out over years, so costs can rise gradually. Additional savings were made by cutting LTC staffing agency costs and delaying some hires. Boosting revenues from user fees will also help offset expenses. District debt remains well within provincial limits, and the District’s Aa1 credit rating has been reaffirmed.
Future Thinking: The 2026 budget includes $112.8M in funding for capital projects. $55.6M for service areas including Roads, Housing, technology (IT) and fleet vehicles, $9.4M to improve landfill and transfer stations, and $47.8M to upgrade water and wastewater systems. The District continues to advance major capital projects, including the Fairvern Long-Term Care home build, and decommissioning of the Mountview Wastewater Treatment Plant in Huntsville, a new 44-unit affordable housing project and the Silver Bridge Rehabilitation in Bracebridge, a new paramedic station in Georgian Bay, major community improvement projects including Bay and Beyond in Gravenhurst and the revitalization of the 117 Corridor in Lake of Bays, and continued construction to restore the community space at the Port Carling Locks in the Township of Muskoka Lakes. Many of these projects are funded through reserves and grants to avoid taking on new debt.
“The updated budget is about planning responsibly while keeping the needs of our communities’ front of mind. It not only improves the tax outcome from the original plan, it also focuses on investing in the programs and services that residents told us are most important to them,” said Suzanne Olimer, Commissioner, Finance and Corporate Services.
Learn more about the 2026 budget by visiting www.muskoka.on.ca/budgets.
