Big changes unlikely in John Tory’s quick-turnaround first budget
Mayor John Tory’s first budget comes out on Tuesday. It can more accurately be described as Joe Pennachetti’s last budget.
A mayor’s second budget is the one he can sculpt to his liking. His first, issued less than two months after he takes office, is largely written by city bureaucrats under the direction of Pennachetti, the retiring city manager, and chief financial officer Rob Rossini.
Bold moves are unlikely.
“I always think we have to manage our expectations. A post-election budget never has a lot of major change in it,” said Councillor Shelley Carroll, budget chief under David Miller and now a member of the budget committee.
Tory’s budget chief, Councillor Gary Crawford, said city officials “pretty much had done the majority of the budget” before they knew who would be elected mayor.
“It’s very much a staff-generated budget. There hasn’t been a lot of councillor input,” Crawford said Wednesday. “So I’m just at this point really just trying to work with staff to get the final budget in place, at a very high level. Because I haven’t had an opportunity to look at a lot of the detail, nor has anybody else on the budget committee.”
The bureaucrats tend to give the rookie mayor wiggle room to do some spending on some of his key promises. Tory has hinted at quick action on homelessness and poverty, and he says his top priorities are transportation and traffic. In a speech days before he took office, he said he wants to try to find a way to reverse Rob Ford’s cuts to bus service.
“I would be disappointed in myself and disappointed in the process of government if we did everything exactly the same, because I ran on a platform of expressly changing some things, and I’ve had lots of opportunities since then to be briefed on other changes that I think need to be made,” Tory said last week.
The budget will take only limited steps toward some of Tory’s ambitious campaign promises. He said he would double the city’s tree-planting budget, investing an extra $7 million per year. This budget will include a much smaller increase: Crawford said the mayor hasn’t yet had a chance to explain how his big spending proposal squares with the city’s existing tree-planting push.
“That’s been vague from him,” Crawford said. “And so we need to sit down, even through this process, (and find out) what does this pledge actually mean?”
The budget includes an “operating budget” now approaching $10 billion, which covers day-to-day spending on programs and services, and a “capital budget” for infrastructure construction and repairs. By law, the operating budget must be balanced.
This year’s balancing has to be done despite the loss of $86 millionin provincial funding and what Pennachetti says is a depleted pool of “efficiencies” left to be wrung from the system. The squeeze would get tighter if Tory fulfils his campaign promise to freeze TTC fares, eliminating tens of millions in potential revenue.
Councillor James Pasternak, a member of Tory’s executive committee, said residents should expect “a very tight budget and not a lot of goodies to hand out.”
Tory says he will keep his pledge to limit the residential property tax increase to the rate of inflation. But he and city officials could plausibly pick any of several inflation figures — the Canada-wide inflation rate (2 per cent in November), the Ontario rate (2.4 per cent), and the city’s own rate (2.7 per cent) all differ.
They have another choice to make about how to handle the already-approved 0.5 per cent increase that will be dedicated entirely to the Scarborough subway. That increase could be included in the inflationary tax hike — in which case Tory would have even less freedom to manoeuvre — or could be added in on top, for an above-inflation total increase that would leave Tory more vulnerable to criticism from the right.
Whatever it is, the proposed tax hike is almost certain to pass. Some of council’s left-leaning members, though, may press the case for a larger increase.
Councillor Gord Perks said an increase at or below inflation would not let Tory keep his commitment to make a difference for people who have been “left behind.” He argued that tax increases lower than inflation are essentially tax cuts, since revenues won’t keep up with rising costs.
“We have 20,000 people on the waiting list for subsidized child care. You can’t solve that problem within the current rate of inflation,” Perks said. “We have $850 million to $900 million in accumulated backlog, and $1.8 billion in soon-to-be backlog over the next four years, in TCHC repairs.”
Tuesday’s budget is merely a draft. The budget committee and executive committee can propose changes at meetings in February and early March. Council will make the final tweaks at a meeting that begins March 10.
With files from Betsy Powell
