Over the past few weeks, I've had a number of people ask how I plan to improve Norfolk County's finances. My original plan was to write one comprehensive article covering everything from budgeting and capital projects to debt, economic growth, reserves, and the Legacy Fund.
The more I thought about it, the more I realized that Norfolk County's financial picture isn't one issue—it's the sum of many parts. Trying to cover everything in a single article wouldn't do justice to the discussion.
Instead, I'm going to break it down into a series of articles, each looking at one important piece of Norfolk County's financial future and how those pieces fit together to create a stronger, more sustainable County.
I decided to begin with the Legacy Fund because Council recently received both an update on the Fund's performance and a presentation on its investment strategy.
The report showed strong investment performance, and that's encouraging. The Legacy Fund is one of Norfolk County's most valuable financial assets. It was created from the proceeds of the sale of Norfolk Power, with the intent of preserving the original investment while using the income it generates to help fund municipal capital projects.
But reading the policy raised a larger question for me.
What does it really mean to preserve the Legacy Fund?
Is it enough to simply protect the original dollar amount?
Or should we also be protecting its purchasing power so that future generations inherit the same financial strength—not just the same number of dollars?
I believe that's a conversation worth having.
Protecting Purchasing Power
The Legacy Fund Policy focuses on preserving the original principal, and that makes sense. Protecting the original investment is an important objective. But it also raises an important question that isn't discussed in the policy.
Imagine putting $100 under your mattress twenty years ago. You would still have $100 today—but it wouldn't buy nearly as much as it did back then. While the dollar amount hasn't changed, its purchasing power has.
The same principle applies to the Legacy Fund.
The Fund was established with an initial value of $67.7 million. The policy is designed to preserve that original amount while allowing investment earnings to help fund capital projects.
However, inflation doesn't stop simply because we've preserved a number on paper.
Over the past five years alone, inflation has reduced the purchasing power of every dollar. A fund that preserves only its original dollar value will gradually lose its ability to deliver the same benefit to future generations.
That's why I believe we need to think beyond simply protecting the principal.
We should be asking whether the Legacy Fund is maintaining its real value after inflation and after withdrawals. In other words, will future residents inherit the same financial strength that previous generations intended, or will they inherit the same dollar figure with significantly less buying power?
This isn't just an accounting exercise. It's about responsible stewardship.
In my view, Council should receive an annual report showing not only the original principal and investment performance, but also how the Fund compares to its inflation-adjusted value. That simple addition would give both Council and residents a much clearer picture of whether we are truly preserving the Legacy Fund—or simply preserving a number.
| Year | Annual CPI | Cumulative Inflation | Required Fund Value |
|---|---|---|---|
| 2020 | 0.7% | 0.7% | $68.2 million |
| 2021 | 3.4% | 4.1% | $70.5 million |
| 2022 | 6.8% | 11.2% | $75.3 million |
| 2023 | 3.9% | 15.5% | $78.2 million |
| 2024 | 2.4% | 18.3% | $80.1 million |
| 2025 | 1.7% | 20.4% | $81.5 million |
Note: The inflation figures shown are based on Canada's annual Consumer Price Index (CPI) and are intended to illustrate how inflation affects purchasing power over time. They are not a calculation of the Legacy Fund's required balance under its investment policy, nor do they account for annual withdrawals, investment returns, deposits, or other changes to the Fund.
In other words, a Legacy Fund worth $67.7 million in 2020 would need to be worth approximately $81.5 million today simply to have the same purchasing power.
Opportunity Cost
The Legacy Fund isn't just a savings account—it's an investment that generates income for Norfolk County year after year.
That means every time Council withdraws money from the Fund, there is more at stake than the amount being spent. There is also the opportunity cost of the investment income that money could have generated for years to come.
A recent example is Council's decision to use approximately $5 million from the Legacy Fund to help fund the purchase of automated waste collection containers.
I would not have supported that decision.
This isn't because I'm opposed to reducing waste. In fact, when I served on Council, I supported initiatives to reduce the amount of garbage going to landfill. I continue to believe we should look for practical, cost-effective ways to improve waste diversion.
My concern is that spending $5 million from one of Norfolk County's most important long-term financial assets was not the best way to achieve that goal.
Once that money is withdrawn from the Legacy Fund, it no longer earns investment income for Norfolk County. Those future earnings are gone forever. Every withdrawal reduces the amount of capital working on behalf of taxpayers.
Assuming long-term investment returns of approximately 4% to 6%, a $5 million investment has the potential to generate $200,000 to $300,000 in investment income each year. That income could help fund roads, bridges, parks, community facilities, or reduce future borrowing.
Instead, that earning potential has been permanently reduced.
This is why every withdrawal from the Legacy Fund should be evaluated not only on what it buys today, but also on what future income Norfolk County taxpayers are giving up.
Before using the Legacy Fund, I believe Council should always answer two questions:
- Is this the best possible use of a long-term public asset?
- Do the long-term benefits outweigh the long-term investment income we are giving up?
Good financial stewardship isn't simply about whether we can afford to spend the money today. It's about understanding what that decision costs tomorrow.
A Better Way Forward
I believe Norfolk County should manage the Legacy Fund with the same discipline that successful families, businesses, universities and foundations manage their long-term investments.
The Legacy Fund doesn't belong to today's Council alone. It belongs to the residents of today and to future generations who will rely on it to help build roads, replace infrastructure and invest in our communities.
That means every decision to withdraw money from the Fund should be made with a full understanding of both the immediate benefit and the long-term cost.
As Mayor, I would advocate for greater transparency by expanding the annual Legacy Fund reporting. In addition to reporting investment returns and the current balance, I believe Council and the public should also see:
- The original principal of the Fund.
- The inflation-adjusted value required to maintain its purchasing power.
- The actual market value of the Fund.
- Total withdrawals made since the Fund was created.
- An estimate of the annual investment income foregone because of those withdrawals.
Providing this information wouldn't change how the Fund is invested, but it would give both Council and taxpayers a much clearer understanding of the long-term financial impact of today's decisions.
Financial stewardship isn't about avoiding every withdrawal. There will always be projects that justify using the Legacy Fund. The important question is whether those projects create greater long-term value than the investment income we give up.
That's the standard I believe Council should apply to every request to use the Legacy Fund. We owe it to future generations to ensure that when we use the Fund, we do so wisely, strategically, and with a full understanding of both the benefits and the costs.
Looking Ahead
This article is only one piece of a much larger conversation about Norfolk County's financial future.
Over the coming weeks, I'll be sharing more articles on capital planning, infrastructure delivery, economic growth, reserves, and modernizing how Norfolk County manages its finances.
These issues are all connected.
A strong financial future isn't built through a single policy or one budget decision. It's built by making hundreds of good decisions over many years.
My goal is simple: leave Norfolk County financially stronger than we found it.
That means protecting our long-term assets, investing wisely, growing our tax base, delivering the projects we approve, and ensuring every dollar entrusted to Council delivers the greatest possible value for taxpayers.
Because good government isn't measured by how much it spends.
It's measured by the results it delivers.