TO:City of Toronto Administration Committee

ORIGIN:Chief Financial Officer and Treasurer

SUBJECT:Integrated Billing and Revenue Management Systems

Purpose:

This report discusses the feasibility of adding permit parking fees to the property tax bill. The report also provides information on the overall direction and development of revenue billing systems for the City of Toronto.

Financial Implications:

N/A.

Recommendation:

It is recommended that this report be received for information.

Background:

At its meeting on May 3, 1999, the Assessment and Tax Policy Task Force requested the Chief Financial Officer and Treasurer "to report on the potential for administrative savings if the City collected permit parking and other fees in a like manner as property taxes and to report on whether any savings should be passed onto the affected ratepayer."

In addition, at its meeting on June 16, 1999, the Works Committee referred the following motion from Councillor Nunziata to the Chief Financial Officer and Treasurer for a report thereon to the Policy and Finance Committee:

"WHEREAS on-street parking permit and front yard parking permit fees are being increased across the City;

AND WHEREAS to help facilitate a reduction in administrative costs of the permit parking program;

THEREFORE BE IT RESOLVED THAT the Works and Utilities Committee recommend that the fees for on-street parking and front yard parking permits be reduced by $10.00, if the fees are charged directly on to the property tax bill of the resident."

Discussion:

Additions to the Collector's Roll - Permit Parking and Other Fees

In order for a fee or special charge to be added to the tax bill, and collected "as taxes" or "in a like manner as taxes", there must be explicit legislative authority to add such a fee or special charge to the collector's roll. There are at least 62 statutory provisions which authorize additions to the collector's roll. These additions range from energy conservation to local improvements, utility and hydro liens. The provisions which authorize the collection of these charges are contained in over thirty-nine separate provincial statutes.

In July 1998 during discussion of service fees for small commercial garbage collection, the Works Committee requested similar information regarding the collection of fees from the landlord in a like manner as taxes, and whether landlords could then collect from their tenants. At that time, the Legal Services Division advised that, in order for fees to be recovered in a like manner as taxes (i.e., added to the tax roll and bill as part of the tax bill), explicit statutory authority is required.

The Municipal Act contains numerous provisions for municipalities to pass by-laws. The power to pass by-laws authorizing permit parking is contained in Section 210(124) of the Act. This section also authorizes charging a fee for any permits issued. However, no explicit authority to collect the fee "as taxes" or "in a like manner as taxes" is provided by this section. The tax bill is a reproduction of the collector's roll. In addition, the Municipal Act dictates what can be included on the tax bill. Presently, there is no legislated authority to add this to the tax bill as "other charges". Therefore, permit parking fees cannot be included on the tax bill at this time. Furthermore, a large portion of parking permits and other City services for which a fee is charged are used by tenants; whereas, tax bills are delivered to property owners.

Revenue Billing Systems:

In the Fall of 1998 the Finance Department successfully implemented a consolidated tax billing system (TMACS) for the City of Toronto. The system handles over $4 billion in annual tax revenue, issues approximately 1.2 million bills per year, and has processed approximately 30,000 appeals. The implementation of this consolidated tax system has greatly enhanced customer service, including appeals processing, and has facilitated the implementation of a new tax bill which provides taxpayers with detailed information regarding the calculation of their property taxes.

In September 1999 the Finance Department began implementation of a consolidated water billing system (WMACS) for the City of Toronto. On September 3, 1999 the Department successfully converted the water accounts for the former cities of North York and East York. Former Etobicoke is currently being converted, and the balance of the former municipalities should be converted onto the new, consolidated system by the end of October 1999. The water system is designed and developed to be integrated with the tax system. Due to time constraints, only basic integration was implemented for 1999. Staff are currently reviewing the system to identify areas for further integration and system enhancements.

Work is underway to identify enhancements to complete and improve functionality in TMACS and WMACS and to complete the integration of the two systems. A submission will be included in the 2000-2004 capital budget for these enhancements.

Starting in October 1999, the Finance Department will also be proceeding with the billing and collection of service fees on a pilot basis from business operators receiving three, five and six garbage collections per week. The service fees will be billed using information supplied by the Solid Waste Management Division's commercial collection database, with the invoices being issued as a separate receivable from the tax billing system. Subject to the pilot project's success, further development will take place to enhance and integrate this system with the Revenue Division's other revenue systems. Staff will report for 2000 on any changes required as part of the 1999 pilot collection program.

Over the next year, the Department will also be exploring the feasibility of integrating certain common features of the parking tags and provincial offences with the tax and water systems, creating a centralized, integrated system for all revenues currently managed by the Revenue Division of the Finance Department. In addition, the Finance Department will be working with staff of other City departments to identify all corporate revenue billing needs that could be addressed through an integrated revenue billing system. This will include further study on the feasibility of billing and collecting fees, service charges or other City revenues from tenants (residential or commercial), including required legislative changes and appropriate collection/enforcement mechanisms.

Conclusion:

In order for a fee or special charge to be added to the tax bill, and collected "as taxes" or "in a like manner as taxes", there must be explicit legislative authority to add such a fee or special charge to the collector's roll.

Municipalities are authorized to charge permit fees for parking under the provisions of the Municipal Act. However, the legislation does not currently allow addition of these charges to the collector's roll. Therefore, permit parking fees cannot be added to the tax bill and collected in a like manner as taxes.

The vision for the Revenue Division of the Finance Department is to operate an integrated billing and management system for all revenue managed by the City (i.e. property tax, water, parking tags, provincial offences, small commercial garbage service fees and other receivables). Integrated systems will greatly enhanced customer service, promoting the concept of "one-stop" shopping for all revenue/billing related activities in the City.

Contact Name:

Giuliana Carbone, 392-8065

Wanda Liczyk,

Chief Financial Officer and Treasurer

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