It is always an easy answer for city councillors to kick the budget can down the street. (If you want to watch the ultimate professionals at this game, the US Congress has established the gold standard for financial ineptitude and threats to shut down the government. In the simplest of terms, the United States of America, the leading economic driver in the world, has not passed a budget bill in a couple of decades—1997, to be exact. In the past 40 years, Congress has only passed a budget on time four times. Holy guacamole.)

Canada's municipalities, of course, must pass a balanced budget each year. As the Municipal Information Network has been faithfully reporting over the past couple of months, tax increases in many towns and cities have been unusually high this year.

Tax increases close to double digits (eg. Toronto: 9.5%) are not unusual. Increases in the 7% range seem common in this budget cycle.

For municipalities that do multi-year budgets, the projections are shaking local taxpayers. For example, if the city projects an annual 7% increase over the four-year term of that council, the cumulative result for taxpayers is a 31% increase. In other words, if you are paying $3,000 a year right now, in four years you'll be paying nearly $4,000 in property taxes.

Back to the starting point of this commentary—deferring tough budget decisions. That will always come back to haunt a future council.

The pressures on local government in Canada are immense and increasing. The primary source of funding through property taxes is a broken system. It is not working and will not work. It will only make things harder and harder for municipalities and the people who live in them—and that is most of Canada.

The cousin of this misery is the lack of investment in infrastructure. Capital spending is frequently a target of cuts at city council. It looks good to slash the Engineering budget by 5%. The subsequent delays in sidewalk repairs, filling potholes and other maintenance might not be noticed much for the first year—but the cumulative impact becomes significant.

As more road repairs are deferred, or a 'shave and pave' is done instead of a full street fix, the damage gets worse and more expensive to repair, and the ratepayers get angrier.

From public housing that is deteriorating to crumbling dams that were built fifty years ago, municipalities across Canada are facing billion-dollar price tags that they cannot afford.

The lack of sufficient investment in infrastructure is an epidemic that has infected all six orders of government. We do not have a national strategy to overcome this crisis. It is impacting our economic competitiveness; if we don't have an efficient electricity grid, for example, we will not be competitive in the global economy. That means we need to expand, secure and re-build the generation, transmission, and distribution parts of that grid. We aren't investing nearly enough.

In my next column, I'll explore some new capital investment strategies that are emerging for cash-strapped cities.