Will the city’s “duct tape” solutions pay off? This was the question councillors were asking after the city manager presented a 118-slide powerpoint breakdown of the 2016 Toronto budget Tuesday morning.
The 2016 city budget is essentially a set up for 2017, meaning council is hoping that by spending now, they can save later. Toronto has committed to a number of transit and infrastructure projects over the last few months, despite the fact they don’t have the money for it.
And city staff are well aware of it.
According to the preliminary budget overview, “The budget outlook for 2016 and forward is challenging. The demand for public services is rising, especially in the areas of public safety, transit, housing and poverty reduction. The city also has substantial capital needs for both new infrastructure and state of good repair; a significant portion these capital projects remain unfunded.”
Throughout the presentation Tuesday, the city manager was open about the unsustainability of the 2016 budget.
“It places priority on the most urgent projects that protect the health and safety of citizens, meets legislated requirements, and those that maintain the City’s infrastructure in a state of good repair,” the report summary reads. “While not all of the identified unmet capital projects are ready to be implemented immediately and there is opportunity for other funding sources, it is apparent that the City lacks sufficient revenues to fund all of the City’s unmet capital requirements on its own over the next ten to twenty years.”
Despite these reservations, the city is going forward with the budget as planned. Here are some of the highlights included in the 2016 budget:
- Poverty Reduction ($90.1 million), including $31.2 million for new affordable rental housing, $6.1 million for affordable housing for women and children, $1.1 million expansion of after-school recreation and care program, and $5.5 million for the mayor’s task force on Toronto community housing.
- Gardiner Expressway ($2.6 billion): This is the cost of the construction of the “hybrid-option,” and does not include the cost of maintenance
- Toronto-York Spadina extension ($596 million) between 2015 and 2025
But, where are these funds coming from? Council will be considering a 1.3 per cent residential tax increase as well as a total tax increase by 0.88 per cent. Funding will also greatly rely on municipal land transfer taxes, an increase in court security costs, and a TTC fare increase. Despite these forms of revenue, there will still be a budget gap of $57.4 million.
The list of unfunded capital projects (projects the city has dedicated itself too, but have realized they have no money for) include the Toronto Community Housing (TCHC) State of Good Repair Backlog, the revitalization of TCHC, SmartTrack, the downtown relief line, waterfront transit, lower Don flood protection, and a number of Toronto Transit Commission (TTC) projects. All together, the city would need an extra $22,337 million to fund these items.
The projects listed under the category of “unmet needs” are some of the most important. The relief line is necessary to alleviate the incredible congestion on the TTC yonge line, and the implementation of TCHC revitalization — especially in light of the recent string of fires taking place in TCHC buildings and the results from the mayor’s report on TCHC and affordable housing — is vital to poverty reduction.
At the end of the report, the city manager recommends ways the city can gain much needed revenue. In the middle of some of the more ridiculous suggestions — the vague recommendation of “new revenues” or “development financing” — was a smart, and feasible solution: tolls. The city is recommending $2.6 billion to rebuild and revitalize the Gardiner Expressway, so why not start a pilot project and try to raise the funds needed for these capital projects? It would solve both problems: the congestion on Toronto highways and the revenue problem at city hall.
It should also be noted that raising taxes was not on the list of possible revenue creators, despite the fact that a 1.3 per cent increase is still comparatively low to inflation. In fact, there were a few councillor’s who expressed disdain at how quickly the executive committee accepted the tax increase in the first place.
Toronto needs politicians who are brave enough to stand up and say: Toronto residents have a choice. They can continue to take an overcrowded subway car to work every day, watch men and women struggle as they are forced to live on the streets, and watch as the city halts development and slowly deteriorates. OR, they can write a cheque.
Personally, I would vote for that councillor.
The budget will be voted on by city council on Feb. 17-18.