Council backs goal of budget freeze, kills stormwater fee
Mayor John Tory is flooded with criticism over plans to ask all city divisions and agencies to keep spending at 2017 levels and to shelve a change to stormwater fees.

TheStar.com
May 25, 2017
Betsy Powell and David Rider

Council backed a budget freeze target while killing efforts to implement a stormwater fee as the second, rainy day of the meeting was consumed by the two debates.

A 30-14 vote directed all city divisions and agencies to present ways to keep their budgets at 2017 levels next year.

When inflation is factored in, that’s the equivalent of cutting two per cent from the $11-billion operating budget.

Mayor John Tory and his council allies rejected an attempt by the left flank to exempt some programs from that target, including services for vulnerable residents, such as the overburdened shelter system, poverty-eduction programs and staff levels at long-term care homes.

Tory stated repeatedly a freeze is just a starting point and gave examples where spending increased this year — such as the TTC and Toronto Public Health — despite a request for a citywide 2.6-per-cent reduction in 2017.

Tory told council he feels reassured he has taken a “balanced approach” as he is facing criticism from two extremes: those who call him a “wreckless spender” and others who label it “an austerity approach.”

The city faces an initial budget shortfall of $343 million in 2018 if property taxes are not raised by an amount above an estimated two per cent rate of inflation, something Tory and his allies will not support.

While the city has faced budget challenges in the past, what staff have outlined as one-time solutions won’t be available again during this budget cycle.

In the evening, council nixed a plan to bring more fairness to who pays the rising costs of stormwater runoff and protection against basement flooding.

With a 27-16 vote, council followed the recommendation from Tory’s executive committee to “receive,” or shelve, a city staff recommendation to go back to the drawing board and return to council in 2019 with a proposed framework for stormwater fees.

Currently, the $275 million annual cost of dealing with runoff water is funded by a charge on water bills, so residents and businesses that use more water pay a bigger share of that cost.

Chief financial officer Rob Rossini said creating a new, dedicated levy would allow staff to base the charge on the amount of owners’ hard surfaces, including buildings, paved areas, driveways and walkways, that direct more stormwater into city sewers that need to be treated, and could potentially flood basements.

City staff told council that, under the proposed charge, “many” suburban residents would pay more than they currently do through the water bill.

The big winners would be owners of apartment and condominium buildings, where users consume water with a much smaller hard-surface footprint. They would overall pay $33 million less through the proposed stormwater charge.

Rossini said the current system unfairly distributes the burden, with owners of property with big parking lots, such as shopping malls, getting the biggest break.

“It’s unbelievable the extent to which this council will go to try to protect the interests of large commercial parking lots. I’m flabbergasted,” Councillor Gord Perks, a former Greenpeace activist, said ahead of the vote.

The new fee would still collect $275 million, but would, overall, boost revenue from residential owners by $14 million, by $16 million for 1-hectare-plus large properties, and by $3 million for industrial and commercial owners.

Rossini noted that consultations with owners of various kinds of properties found unhappiness with several aspects of the plans, so staff asked executive committee to let them refine the plan and come back with a new one in spring 2019.