On December 17, Toronto City Council approved an extension to the City Building Fund to invest an additional $6.6 billion in improving Toronto’s transit system and building more affordable housing across the city.
This dedicated levy can only be invested in major transit and housing capital initiatives. City staff will now incorporate the additional revenue generated by this separate levy into the 2020 to 2029 tax-supported Capital Plan. The staff-recommended 2020 Operating and Capital Budgets will be available on January 10, 2020.
The extension will increase the City Building levy by an additional 1.0 per cent in 2020 and 2021 (bringing the total levy to 1.5 per cent in those years) and extend the existing levy by 1.5 per cent annually from 2022-2025, costing the average Toronto household approximately $45 per year. The increases will be phased in year over year, totalling a household tax increase of approximately $280 over six years.
The City Building Fund was first approved by City Council as part of the 2016 budget.
Along with the approval of the City Building Fund extension, City Council also received the results of the Value-Based Outcome Review (VBOR). The study identified millions in efficiencies that the City will be implementing in the 2020 Budget, and that will lead to tens of millions in repeated and expanded savings in the following years for the operating budget. These include measures such as contract compliance and changes to procurement.
VBOR analysed actual spending by City divisions and major agencies from 2015 to 2018, with the goal of finding efficiencies, preserving service levels and addressing long-standing challenges.
Key findings from the VBOR include:
• the operating budget is forecast to be sustainable under current service levels;
• the cost of growth has been managed through efficiencies, but will not cover the full cost of growth in the future;
• the capital budget must be achievable and sustainable; and,
• opportunities to deliver better value, find efficiencies and drive savings.
The VBOR analysis and findings will inform the City’s strategy for modernizing financial decision-making to achieve Council’s priorities and long-term financial sustainability. The City Building Fund extension will help relieve pressure from the capital budget, while the City moves toward sustainable financial solutions.
For more information on the City Building Fund, visit: http://app.toronto.ca/tmmis/viewAgendaItemHistory.do?item=2019.EX11.26
For more information on the City of Toronto’s 2020 Budget, visit: https://www.toronto.ca/city-government/budget-finances/city-budget/
Quotes:
“Extending the City Building Fund puts Toronto on the right path to improve our existing transit system as the provincial and federal government help fund further transit expansion and the right path to build more affordable housing so people can live here. This is the best way forward – given the current political climate and the true lack of revenue tools realistically available – to help us raise $6.6 billion for transit and affordable housing. These are investments we need to make to protect and continue our city’s success.”
– Mayor John Tory
“Over the last five years, we have saved taxpayers $891 million. Still, the City is growing fast. So fast in fact, that if Toronto were a province its economy would rank third only after Ontario and Quebec and equivalent to Alberta. We have saved millions, but we need billions to make major infrastructure investments. To do that, things have to be done differently. Extending our City Building fund will provide the necessary dedicated funding for specific priorities. This dedicated levy, which started in 2017, ensures that the money collected is used to invest solely in our transit and housing infrastructure.”
– Budget Chief Gary Crawford (Ward 20 Scarborough Southwest)
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