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Homeowners face 3-4% tax hike

Province’s $500 million transit funding handout will ease city’s budget woes next year, says mayor

Dec 14, 2007 04:30 AM
Vanessa Lu
City hall bureau chief

Toronto homeowners can expect a 3 to 4 per cent property tax increase next year, thanks to millions in transit funds promised by Queen’s Park, says Mayor David Miller.

“For the first time since amalgamation, it will give us a viable operating budget before the budget process starts,” Miller told reporters yesterday after Finance Minister Dwight Duncan delivered his economic statement.

“It’s great news,” the mayor said.

With the promise of $500 million for public transit in the province - of which Toronto is expected to get a large chunk - the city can avoid the usual spring budget dance.

Because of systemic funding shortfalls for transit, welfare and public housing, politicians have scrambled every year to balance the operating budget, which grows to $8 billion next year.

Typically there are dire warnings of cuts or threats of whopping tax increases until Queen’s Park offers up last-minute assistance.

This year, the city will be able to take money earmarked for transit maintenance and use it to cover other items, Miller said. “I’m extremely happy. This provincial government, unlike its predecessor, has decided to work with cities.”

The new money comes on the heels of a bitter fight at city hall over the need to generate new revenue. In October, council approved a new land-transfer tax and a new motor vehicle registration tax.

Those two items are expected to raise $175 million in 2008. Next year’s budget shortfall is estimated at about $250 million.

TTC chair Adam Giambrone said the final numbers in transit funds should be available in a few days.

The TTC’s state of good repair budget, which covers equipment maintenance and replacement, is $570 million next year.

Miller bristled at a suggestion the transit money is a way for the Liberals to help Toronto without angering the rest of the province.

“They’re making significant investments in public transit in cities in the 905, and Toronto, and Ottawa, and Windsor,” he said. “Yes, it helps Toronto because we have the biggest transit system.” Miller also hopes a review of downloaded social services due in spring will result in more money for Toronto.

Mississauga Mayor Hazel McCallion praised the new infrastructure and transit funding. “Anything to improve transit in the Greater Toronto Area is a benefit to all municipalities within the Greater Toronto Area,” she said.

Doug Reycraft, president of the Association of Municipalities of Ontario, said it isn’t enough yet, but it shows “the province recognizes there is a large need, and this is a significant downpayment on it.”

With files from Paul Moloney and Kerry Gillespie




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