28 Sep So How Do We Pay?
Promises get made in the campaign season, but post election, someone has to pay for them. The single greatest threat to our progress on all of Toronto’s key challenges in the next four years is our budget. Ideas on improving transit, creating housing, reducing crime or supporting arts, culture and recreation all amount to nothing if we are not willing to create a sustainable financial plan.
Last fall, the city’s chief financial manager gave a report detailing the path to a financially sustainable future, warning that we are unable to continue with meeting city-building targets without generating additional revenue.
In plain language? We’re headed for deep cuts in quality of life in this city if we don’t consider some type of tax or fee increases.
I want to move forward with the solutions I have proposed in my platform, and I’m willing to put raising revenue in this city on the table to pay for it. Why? Because when it comes to the challenges we are facing, whether due to transit, housing, safety or the environment, if we don’t invest in the solutions, we pay for the problems instead – and those costs are much higher.
Here is the approach I want to take to create a financially sustainable city budget.
1. Determine spending needs before creating the budget
Our city council adopts plans, strategies and vision statements in response to community concerns. Sometimes they are even unanimously endorsed. But when it’s time to fund them, the support evaporates. We need to pair our decision making on commitments with the budget to fund them, otherwise we both mislead the public on what’s being done and waste tax money on preparing plans that are never completed.
2. Reduce spending on what doesn’t make this city better
Before raising further revenue, I would look at where we can reduce spending that is wasteful and unnecessary. For example, we could save $500 million or more if we replaced the Gardiner with a boulevard rather than rebuilding it, and we could save $20 million if we proceed with a transformative rebuild of Yonge Street north of Sheppard, rather than the compromise plan that the current mayor is on record as favouring.
3. Incorporate resident input through participatory budgeting.
Toronto has started a participatory budget process, and now it’s time to expand it, so that all residents across Toronto can have a say in how their money is spent.
4. Raise revenue when necessary.
Any decisions on raising revenue need to be made using three guiding principles: transparency, so residents know where their tax dollars are going; return on investment, which means evidence is used to spend in ways that yield genuine returns either fiscally or in the quality of life in our residents; and affordability, so that no additional financial pressure is placed on low income residents.
In 2016 Toronto received a complete report on the revenue tools available to us. We know how we can raise funds, it’s a matter of political will whether we do so. Revenue tools I would explore include:
- Levy on ride-sharing services. Such services, while benefitting some residents, have associated costs due to the increased congestion they can cause. It makes sense to fairly tax these services, and devote the funds to transit and road repair.
- Increasing property tax on those that can afford it. Canadian homeowners in the lowest income group pay five times more in property tax relative to their income than the highest income homeowners.There are ways to ensure property tax increases do not hit those in low income taxes, including adjusting tax rates on the type of dwelling, decreasing rates for apartment buildings, allowing residents to defer property taxes until they sell their home, and providing tax rebates or credits to low income residents and people with disabilities.
- A commercial parking lot levy, which offers the additional benefit of reducing congestion, if dollars are applied towards improving other modes of transportation.
- Water and stormwater charges. Current water rates are not sufficient to cover all utility expenses. I would work with council to institute conservation pricing, to reduce the cost of treating water, and would do so in a way that does not increase the rates of low income, low water users. With the high costs of flooding we have faced this summer, it is clearly time to institute a stormwater management fee as municipalities across Canada have done.
Along with these measures, the city must continue to advocate for fair funding from the provincial and federal levels government, as well as the legal changes to allow the city to implement road tolls or other revenue options. Such funding would lessen the tax burden on our residents.
It’s time for us to chart a path that combines wise spending with fiscal responsibility. What kind of city do you want to live in?