Vote Toronto 2010 Scarborough Town Hall March 5, 2010

Campaigns Goals: Frame the key areas of debate that the election will be fought on Engage members in the formulation of ideas and policy recommendations To mobilize members and the broader Toronto-public in a campaign to convince candidates to adopt Board recommendations into their own platforms Four Themes: Fixing our City Finances Growing the Regional Economy Strengthening our Social Cohesion Improving Civic Democracy 1

The Growing Chasm: Torontos Budget Shortfall Unsustainable $72$173$208$347$393$388$264$447 Sustainable $97$115$136$135$139$174$351$232 $0 $100 $200 $300 $400 $500 $600 $700 $ Millions City of TorontoUnsustainable Funding Sources for Net Operating Expenditures

2010 City of Toronto Operating Budget Highlights Total proposed budget $9.2-billion: Represents a 5.7% ($500M) increase in gross spending over 2009 Base budget increase ($388M) structural deficit ($451M) = TOTAL BUDGT PRESSURE of $821M Budget Gap closed by a combination of: $388M sustainable budget strategies (user fees, TTC fare increases, MLTT, PVT, Provincial uploads etc.) $87M Property Taxes/$33M Assessment Growth $313M unsustainable strategies (strike dividend; reserves; $219M surplus) 3

Running to Stand Still Historic Problem (2002 – 2008) was caused by a mismatch in revenues and expenditures): Property taxes increased at an average of 2.9% Expenditures increased at an average of 5.9% 2010 Budget continues similar mismatch: Property taxes increase 3.5% Expenditures increase 5.7% City notes that 3 major services are driving cost increases: Ontario Works: $155M Housing: $130M TTC: 80M 4

The Growing Chasm: Forecast assumptions All net tax-supported program costs increase at an average annual rate of 5%. Revenues from non-tax sources (eg: grants and user fees) increase at the same rate as gross costs. All unsustainable revenues used to balance the 2009 budget are not available as revenue in 2010 and beyond. Estimated benefits from uploading Ontario Works and Police Court Security costs are incorporated. Debt servicing costs and current funding for capital projects are included as per the Capital Budget. The model credits additional revenue from the 2010 TTC fare increase as $50 million in This revenue is held constant until A 15% increase (yielding $57.5 m per year) is assumed each year from 2013 to 2015, and a further 15% increase (to $62.2m per year) from 2016 to Assessment growth is assumed at 1% per year Total tax revenue is assumed to increase by 3% per year. 5

The Growing Chasm: Toronto budget forecast 6

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Understanding property taxes: GTA Business Property Taxes MunicipalityCommercial (%)Industrial (%)Residential (%) Toronto Pickering Brampton Burlington Mississauga Vaughan Markham

Understanding Property Taxes 10

Understanding Property Taxes 11

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Solutions: Emerging Principles Solutions must be multi-year Emphasis on expenditure reductions Focus on major expenditure savings Labour (representing 47% of total budget) must be a key focus Need to examine new labour model Potential conflict with unions Structural (transformational) changes not available in the short term Business property taxes cannot be a source of new revenues Monetization of assets not desirable for operating budget Provincial legislation review needed (eg. Arbitration Act, Police Services Act) TTC and Police Audit must be a priority Budget processes must be more transparent 13