Ford cuts will cost Toronto $177.65 million this year, city manager warns

Thestar.com
May 10, 2019
David Rider

Ontario Premier Doug Ford’s budget cuts will cost Toronto at least $178 million this year alone, the city manager warns in a new memo to Mayor John Tory and city councillors.

Quantifying the big hole blown in Toronto’s budget finalized in March -- before Ford’s provincial budget unleashed a series of surprise funding clawbacks -- added heat to a war over the cuts between the Progressive Conservative premier and the mayor who used to lead the same party.

Budget cuts by Ontario Premier Doug Ford (right) will cost Toronto at least $177.65 million this year alone, warns the city manager in a new memo to Mayor John Tory (left) and city councillors.

The federal Liberal government joined the fray Thursday, with Border Security Minister Bill Blair taking aim at a Ford cabinet minister who accused Tory of neglecting to recover money owed to the city by Ottawa for housing refugee claimants.

The cutback controversy is growing, said Councillor Joe Cressy, who is leading the fight against a major cut to Toronto public health funding, noting elected leaders across the province are supporting Toronto and warning their residents that provincial downloading will hurt them too.

“There is a growing wave of opposition across Ontario and clearly the premier and his caucus are clearly feeling pressure to reverse these short-sighted cuts and I’m hoping they’ll do so,” said Cressy, chair of the Toronto Public Health board.

At Queen’s Park, Treasury Board President Peter Bethlenfalvy said the PC government has made “made tough choices” and will stand firm that municipalities need to pitch in.

“Everyone’s got to do their part,” Bethlenfalvy told reporters.

Asked about city manager Chris Murray’s tally of $177.65 million in provincial cuts to Toronto this year -- equivalent to an almost 6-per-cent property tax hike -- the minister said there are numerous ways for Toronto to find efficiencies and fill the gap.

“We cannot just pass the buck,” to the next generation with huge deficits, Bethlenfalvy said.

Murray’s email sent Thursday gives an overview of known cuts to provincial transfers to Toronto, estimates impacts on the city and “anticipated and indirect funding changes that may have future implications for the city and are being monitored by staff.”

He breaks down the provincial budget impacts on this year’s budget as:

• $24 million from cancellation of planned provincial gas tax funding.
• $65 million for Toronto Public Health.
• $84.8 million for children’s services
• $3.85 million for Toronto Paramedic Services.

 

The impact of the cuts, if Tory’s pressure campaign on Ford fails to force a provincial retreat, will be greater in future years because most of the cutbacks in the provincial budget take effect April 1.

That means the city is getting reduced funding for nine months of 2019, but will feel the full-year impact of the cuts starting in 2020.

City manager's memo to council

Murray restated some cuts council already knew about, such as the loss of extra gas-tax money that the previous Liberal government had promised Ontario municipalities and which Toronto earmarked for badly needed upgrades and maintenance.

The city manager provided some new issues as well, including the April 26 notification from Ontario’s Health Ministry that Toronto’s grant for ambulances will not, unlike prior years, include an increase to compensate for inflationary costs.

The $3.85 million reduction from what city council was expecting, and included in its 2019 budget set in April, is equal to a 3.5 per cent cut, Murray said.

In a statement Tory, who is leading a film and TV trade delegation to Los Angeles, said: “We will keep making the case that these unilateral, retroactive cuts to child care and public health will hurt residents, especially kids and families, and threaten Toronto’s prosperity.

“I remain open to sitting down and discussing these cuts with the province in a productive manner. We have repeatedly offered to attend any such meeting which could have happened weeks or even months ago.”

He also continued to urge residents to put pressure on PC MPPs in Toronto ridings, saying “they did not seek or receive any mandate from voters to cut child care and public health.”

Murray also warns of other impacts on this year’s city budget he can’t yet quantify. They include the likelihood that provincial belt-tightening on provincial welfare and disability benefits will mean less money for Toronto to administer the programs for local residents.

The city manager also lists indirect cuts, meaning they impact residents and the city as a whole but not the City of Toronto’s 2019 budget. They include the elimination of Tourism Toronto’s $9.5 million provincial funding.

The mayor has escalated his attacks on Ford in recent days, saying Toronto, hit disproportionately hard, will not reopen its budget and the Progressive Conservative premier must put on hold the “damaging” cuts.

Tory hammered Ford this week for moving to reopen an agreement with operators of the Beer Store, potentially costing the province more than $1 billion, while cutting services to low-income children, parents with subsidized child care spots and others.

Ford and his cabinet ministers have been firing back, insisting Toronto and other municipalities can find internal savings to offset the cuts and that residents should feel no impacts as a result.

Ontario’s Minister of Children, Community and Social Services, Lisa MacLeod, accused Tory in a Wednesday letter of not dealing with wasteful city spending and of not lobbying the federal government hard enough to get money to help house “illegal border crossers” -- people who requested asylum.

“While you have found time to hold media availabilities and photo opportunities at City Hall to protest a reallocation of 0.24 per cent of your total budget, you seem to have forgotten about the tens of millions of dollars owed to you by the federal government,” MacLeod wrote.

That prompted a response from Blair, who said the Ontario government has abandoned its role in housing asylum seekers so Ottawa has been forced to deal directly with Tory and Toronto. On Thursday Blair followed his words with another $45 million for Toronto to deal with the spike in newcomers.

Meanwhile, city number crunchers have a daunting task if the nine-figure cut stays on the table.

The impact for this year, if the cuts were offset solely by taxpayers, would require a roughly 5.9 per cent property tax increase on top of an increase already passed in March.

The current 2019 budget raised residential property taxes for homeowners by 3.58 per cent, which will mean $104 more than 2018 and a total bill of $3,020 on the average $665,605 home. A 1 per cent increase would cost the average homeowner about $30.

The budget debate saw council arguing over spending in the six- to seven-figure range, like $1.7 million for 10 new dedicated youth spaces within community centres or libraries or a $655,400 pilot project to pick litter in the city’s ravines. Those motions failed at council without sources to fund those programs from other than pulling from rainy day reserves, cutting other programs, or raising taxes.