Mayor Tory eyes reserve funds to balance Toronto budget

Mayor John Tory’s budget plan balances the books with $51.8 million in one-time funding.

Thestar.com
Jan. 18, 2016
By David Rider

Mayor John Tory wants to hike spending and keep property taxes low with help from more than $50 million in one-time funding including reserve accounts.

Councillor Gary Crawford, the budget chief, called the administration’s spending blueprint “the right thing to do.”

“We can’t do it all but we can make a real difference in the lives of the people of this city while keeping life affordable,” he said after unveiling the proposal Monday.

It would limit the residential property tax hike to 1.3 per cent or, for the owner of an average detached home, $34 plus another $15.34 for the Scarborough subway surcharge.

The Tory administration wants council to fund almost $29 million in services from a list of $67 million identified by council as priorities for which there is no funding source.

The plan would: add $5 million in poverty reduction efforts including warming centres open 24 hours a day in January and February, TTC improvements including increased streetcar reliability, an arts funding boost and TCHC spending on new secure door systems for more buildings.

Items the Tory administration says the city can’t afford include better bus maintenance and service reliability, improved parks trail maintenance and the introduction of urban park “rangers.”

The plan balances the books with $51.8 million in one-time funding.

That includes taking $12.5 million from a rainy day reserve fund for housing and $4.6 million from a daycare reserve.

Toronto police would be ordered to find $3 million in savings. The TTC, while receiving money to boost specific services, would also see its base operating budget cut by $5 million.

The city would demand “special dividends” totalling $10 million from the city parking lot operator and an agency that leases property in the Port Lands. The city would bank on an extra $5.5 million in payments by senior governments in lieu of property taxes.

Councillor Gord Perks said the mayor’s plan papers over the fact that, without bigger tax hikes and new revenue sources, Toronto can’t afford to pay for the services it wants.

Reliance on one-time funding compounds the problem because next year the reserves will need to be replenished, and other revenue found for the ongoing expense, Perks said. Meanwhile low-income parents are getting no help paying for daycare.

“We must either cut services or increase taxes. There is no other way,” Perks told reporters.

“The only way a budget like this can be healthy for the city of Toronto is if there is a clear commitment - we’re going to do the work to bring the long-term revenues in so we can backfill these holes and keep the services.”

He wants Tory to commit to a frank debate on revenue tools - new fees and taxes - to put on a sustainable footing budgets for next year and beyond. A briefing note surveys council’s options, including the Toronto-specific sales tax favoured by Perks and former city manager Joe Pennachetti.

Crawford acknowledged the one-time spending but said it’s necessary in a “transitional” budget as the administration restores some funding cut in the Rob Ford years.

As for revenue tools, the budget chief would only say “that’s a debate council will have to have.”

Social Planning Toronto, part of a group including the United Way and Toronto Region Board of Trade that endorsed a poverty-fighting plan, said the new spending and previously budgeted items fall far short of the $75 million needed to make a big impact.

“Very, very little of the items on (our) list and have made it into the proposed budget and that's very concerning,” said Sean Meagher, Social Planning Toronto executive director.