By now, you'll have seen the news of the 2024 City Budget as prepared by City staff. Regular readers of this E-Blast have seen me spell out the deep challenges our city has faced over the past few years. In the coming weeks, my task is to engage with as many Torontonians as possible through the Budget process so we all understand exactly where we stand.
Let's take a look back at how we got here. We started this budget process with a glaring $1.8 billion operating budget shortfall. For those who need a quick refresher, our operating budget covers all of the day-to-day services our city delivers: everything from transit, police, and shelter services to long-term care, waste collection, and libraries. To put that $1.8 billion number into perspective, we could have completely eliminated transit service in Toronto and gotten rid of all of our libraries and we'd still have a shortfall of over $300 million to deal with.
A slide from City staff's 2024 Budget presentation outlining our budget challenge this year. Click to view a larger version.
When I took on the role of Budget Chief, my first priority was to use every avenue available to bring that number down. Working closely with our Chief Financial Officer and City Finance staff, we found over $600 million in cost savings and avoidance for the 2024 Budget, including a hiring freeze and absorbing staff departures.
While that $600 million was mostly achieved through efficiencies, it does include a few proposed cuts. One of those is to stop offering windrow snow clearing starting next winter season. I know this service hasn't been delivered to your expectation for many years now and that, at the same time, many North Yorkers miss the old service we used to enjoy pre-amalgamation. Staff have advised that by cutting windrow clearing, contractors can better focus on the other snow clearing services they provide. Let's discuss in the weeks ahead.
Mayor Chow also announced a historic New Deal with Premier Ford back in November, which included nearly $400 million in operating funding for this year alone. Even with all the savings we found and the support of the Province, we knew that there were still going to be some very tough choices to make. That's why we came to you, the community, for a series of Pre-Budget consultations back in November.
A slide from City staff's 2024 Budget presentation showing what is proposed to close the $1.8 billion gap. Click to view a larger version.
What we heard loud and clear from residents in every corner of the city is that you expect us to protect the city services you rely on. We need to keep transit safe and running, keep our emergency services well-funded to make sure they get to you quickly and keep you safe, and keep working to make housing more affordable. This budget makes key investments in those priority areas. We're investing in community safety by increasing the police budget and investing $25 million to expand the Toronto Community Crisis Service city-wide. We are freezing TTC fares in 2024 to keep transit affordable for riders and get folks back riding the system. We're continuing to push forward to make housing affordable, all while continuing careful reviews of every division to make sure their operations are as efficient as possible.
It was the conversations we had with the community on these key issues that shaped the budget presented by staff yesterday. That budget includes a 9% property tax increase on the operating side to eliminate this year's massive shortfall, and a 1.5% increase to the City Building Levy, which invests in essential capital projects in our city, particularly transit and housing. This fund is set aside every year because when the Provincial and Federal government announce big investments in Toronto capital projects, the City has to pay for one third of the cost.
I know that this year's property tax increase is much higher than people are used to. For the average household, this increase means an additional $30 per month, or about $1 per day. As your Councillor and a homeowner who's supporting a family of my own, I would never accept this proposal from staff if I didn't deeply understand just how hard it was to get the number down to 9% to close the $1.8 billion gap. We can't keep kicking this can down the road. As your Budget Chief, it is my responsibility to present a responsible, balanced budget.
To put this increase in context, Toronto has long had some of the lowest property taxes in the GTHA. While this year's percentage increase might be slightly higher than our Ontario neighbours, it brings our property taxes to middle of the pack of what other homeowners pay in real dollars. Major cities across Canada are also coming forward with larger than usual property taxes this year. My hope as Budget Chief is that by facing this shortfall head-on this year, we can start to see it really come down and put our city back on track for the years ahead.
A clip from CBC outlining the property tax increases being presented across Canada.
I also want to remind folks that the City has Property Tax Increase Deferral and Cancellation Programs for seniors and others living on fixed incomes. If you have questions or need support applying for this program, my office is always available.
Now, let's talk about the one outstanding item. We continue to call on the Federal government to cover the cost of Federal refugees stuck in our shelter system. We are doing all we can to settle and house these new residents, but the number of refugee claimants moving through the City's system has increased from the usual 500 to over 5800. This is the result of Federal policies, which means the $250 million required annually to serve and settle these refugees is squarely a Federal responsibility.
The Mayor has been working hard to get an answer from the Feds on this issue for months now. If the Federal government does not make a decision on how to proceed by the time we wrap up this Budget process, we will have to ask staff to bring forward an additional 6% Federal Impacts Levy to cover the cost, or risk devastating cuts that will make our city less safe and increase congestion.
Federal refugees outside of an overcapacity shelter on Peter Street last summer.
Long-time readers of this E-Blast know that there is another conversation we need to have, and that revolves around the fact that, ultimately, a city of our size should not be relying on property tax alone to fund the wide array of services we now offer. Last year, City staff released a new Long-Term Financial Plan that spelled out a number of routes we can take to address our structural financial challenges. Conversations with our Provincial partners continue on some of the long-term tools we need to put our city on a path to true financial stability. I also hope to see us reach a New Deal with our Federal counterparts, as we were so grateful to have reached with the Province last year.
This Budget launch is just the beginning of the budget process. This year, that includes more opportunities than ever before for you to engage and share your feedback. I'll be joining Mayor Chow to host three city-wide Telephone Town Halls next week. I'll also be joining Budget Town Halls across the City and hosting our very own Town Hall here in Don Valley North on Monday, February 5th (more details below the column). Of course, there is also the usual series of public deputations and you can always submit your comments by emailing the Budget Committee or my office. You can find more information about how to get involved using the buttons below, and also find all of the Budget documents and presentations. This is a fully transparent process.
I know that folks have real concerns about affordability these days. When times are tough, people need to be able to count on their city to deliver and protect the services they rely on most. I firmly believe that we can't keep pushing off our financial struggles for future Councils and future generations to deal with. As I always say, I want to build a city that my grandkids can proudly call home and one that gives them all the supports they need to succeed. That is what this Budget aims to do: preserve the most essential services, finally dig Toronto out of the hole we've been sitting in for far too long, and get our city back on track.
A NOTE ON THE DUNDAS RENAMING
Over the past few weeks, my office has receive a number of emails and calls about City Council's decision to rename Yonge-Dundas Square. I want to reiterate the full details so that you understand where I stand and what is happening next.
Mayor Chow led City Council in shelving the previous $13-million proposal to rename Dundas Street in light of our significant financial challenges.
While Yonge-Dundas Square is being renamed, the cost will be entirely paid for by Section 37 funds from the local ward, which are collected from developers and must be spent on local capital projects. It will have zero impact on our operating budget and is not being paid for by your tax dollars.
I voted in favour of this much more modest proposal as it balances our financial reality and the need for prudent spending with our City's commitment to confronting anti-Black racism and building a more inclusive and equitable city.
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