COUNCIL IS MAKING PROMISES THE BUDGET CAN'T KEEP
ILLUSTRATION BY Frank Fiorentino
Budgets. Boring, right? But financial illiteracy in this country is a problem. The Bank of Canada’s statistics on household debt are horrifying: On average, each working Canadian owes $1.70 for every dollar they earn. That’s up 100 per cent from 20 years ago. That is not sustainable. Warning bells have been going off for the past 10 years: A looming personal debt crisis in Canada could trigger an even bigger collapse than the 2008 Great Recession. Those Cassandran bells are conveniently drowned out by calming waves of cheap credit.
It’s not fair, however, to single out individual behaviour here, because it’s not like City Hall does any better.
The City of Toronto is no different than the archetypal millennial: you know, the one in an underpaid job who doesn’t know how to cook and so instead (supposedly) drops $30 on avocado toast and an artisanal cocktail. We’re swimming in debt, revenue is drying up, and we’re making promises to ourselves that we can’t keep. The bubble will burst. Maybe it already has.
Ah, who cares. Budgets are boring.
Until the repercussions stare you in the face. Like this winter, when you’re breaking a shovel trying to chip away the ice surrounding your car, or trying to push a stroller down even the most well-travelled sidewalks. This winter, the “elite” downtown streets are mountains of ice.
“Even an easy walk with the dog at night feels like you're taking your life in your hands,” tweeted Metro Morning host Matt Galloway. “What a mess.” It’s clear that the city’s strategy is amounting to little more than simply waiting for the snow to melt.
At a Feb. 4 budget committee meeting, Councillor Mike Layton put forth a motion asking Transportation Services to provide budget briefing notes on the cost of enhanced and increased snow clearing, and of enforcing parking violations that obstruct TTC lanes – like the cars parked halfway into the street, because of snowbanks, which held up the College streetcars for hours a few weeks back. Layton’s motion was voted down. On Twitter, someone rightfully asked him why Montreal is able to deal so effectively with snow removal while Toronto is not; part of the answer he offered was that Montreal has higher property taxes (an extra $1,300/year, based on a $1-million home).
The ice is just the tip of the ’berg. City columnist and blogger Matt Elliott writes about $79 million worth of “mystery meat” in this year’s budget, money that the city requires, but doesn’t have, to balance the books, which they are legally obligated to do. That includes $10 million in unspecified, random savings somewhere in City Hall, a big ask for $45 million from the feds for shelters, and – here’s the kicker – “$24 million in unspecified TTC reductions to be found at some point in 2019.” Your bus doesn’t run on time now; how much worse will it be after reductions? Meanwhile, council is talking about yet another fare increase at the same time the auditor reveals the TTC lost $61 million in fare evasion last year, largely, and entirely unsurprisingly, on the new streetcars.
On top of that, council has approved all kinds of measures that aren’t actually funded in the budget, as the Star’s Jennifer Pagliaro found. Sweet talk is not only cheap, it’s free, and you get what you pay for.
John Tory, like Rob Ford before him, campaigned and delivered on a promise not to increase property taxes. Success: A new report from Ryerson University points out that Toronto’s property tax burden (taxes as a percentage of household income) is 21 per cent less than the average in the Greater Toronto and Hamilton Area. (Orangeville and Oshawa were the highest; only Milton’s was lower.) So who wants to pay more tax?
Mike Layton does. So does Shelley Carroll, who was budget chief under mayor David Miller from 2006 to 10. Both she and Layton are on the budget committee, and on Feb. 20 they put forth a motion to increase the property tax of the average homeowner (based on a house worth $665,605) by a whopping $30. This would halt the proposed transit fare increase, fund youth programs that are proving to be incredibly effective in “priority neighbourhoods,” and even pay to pick up trash in Toronto ravines. The motion was voted down.
The next day, Carroll tweeted, “All four of my budget years were balanced … but still built up a property tax reserve of $364 million to buffer us through the global financial crisis. But I’m not bitter [smirking smile emoji].”
Jennifer Keesmaat, mayoral challenger in 2018, retweeted Carroll, adding, “Funny that progressive regimes (like Miller/Carroll) embrace sound (conservative) fiscal management and the so-called ‘conservative’ regimes (ahem Ford/Tory) have balanced the budget by selling assets and pillaging the reserves (that were built up by the progressive regime.)”
About those reserves: In December, city staff announced that the municipal land-transfer tax, in place since 2008 and dependent on a then-robust real estate market, was going to fall short by $99 million this year. Star columnist Ed Keenan compares the coming crisis to the “sinking of the Lusitania,” a disaster that could have been avoided had anyone heeded obvious warning signs. If that financial apocalypse comes true, as long predicted by Councillor Gord Perks, what about the $2 billion Toronto plan to rebuild the Gardiner Expressway? Speaking of which, The Globe and Mail’s Alex Bozikovic points out that “Toronto could fully repair every one of its social housing units and every one of its parks facilities for less than it is spending ($2b) on repairing one elevated expressway.”
Let’s not even talk about building transit right now.
If there’s a gravy train somewhere in this town, it derailed a long time ago. Anyone, at any level of government, who promises both low taxes and no cuts to services is a charlatan. Unfortunately, one of the leading proponents of that muddy math is a former city councillor who is now the premier.
Ladies and gentlemen and everyone in between, may I present to you Mr. Leonard Cohen: “Everybody knows the boat is leaking / Everybody knows the captain lied.”
Take my $30. Please.
The 2019 City of Toronto budget will go to a vote at the March 7 council meeting.
Soundtrack to this column: “Where Does All the Money Go?” by East River Pipe; “Money Money Money” by ABBA; “Johnny Delusional” by FFS; “Living in Another World” by Talk Talk; “Everybody Knows” by Leonard Cohen
This ongoing online column will be about those who make it their job to make this city work. I’ll be following not only representatives at City Hall and Queen’s Park, but also the neighbours who run businesses, sit on committees, spearhead projects and light up our lives. Hit me up with tips at michael@westendphoenix.com.