IMFG / en Toronto budget 2017: οexperts say the city needs new ways to make money /news/toronto-budget-2017-u-t-experts-say-city-needs-new-ways-make-money <span class="field field--name-title field--type-string field--label-hidden">Toronto budget 2017: οexperts say the city needs new ways to make money</span> <div class="field field--name-field-featured-picture field--type-image field--label-hidden field__item"> <img loading="eager" srcset="/sites/default/files/styles/news_banner_370/public/budget.jpg?h=afdc3185&amp;itok=aP6Q9XLE 370w, /sites/default/files/styles/news_banner_740/public/budget.jpg?h=afdc3185&amp;itok=C2viaWJU 740w, /sites/default/files/styles/news_banner_1110/public/budget.jpg?h=afdc3185&amp;itok=tpkMI-KF 1110w" sizes="(min-width:1200px) 1110px, (max-width: 1199px) 80vw, (max-width: 767px) 90vw, (max-width: 575px) 95vw" width="740" height="494" src="/sites/default/files/styles/news_banner_370/public/budget.jpg?h=afdc3185&amp;itok=aP6Q9XLE" alt="Toronto skyline"> </div> <span class="field field--name-uid field--type-entity-reference field--label-hidden"><span>Romi Levine</span></span> <span class="field field--name-created field--type-created field--label-hidden"><time datetime="2016-12-06T15:22:15-05:00" title="Tuesday, December 6, 2016 - 15:22" class="datetime">Tue, 12/06/2016 - 15:22</time> </span> <div class="clearfix text-formatted field field--name-field-cutline-long field--type-text-long field--label-above"> <div class="field__label">Cutline</div> <div class="field__item">Toronto City Council is set to vote on the budget in February (photo by Sam Javanrouh/Flickr)</div> </div> <div class="field field--name-field-author-reporters field--type-entity-reference field--label-hidden field__items"> <div class="field__item"><a href="/news/authors-reporters/romi-levine" hreflang="en">Romi Levine</a></div> </div> <div class="field field--name-field-author-legacy field--type-string field--label-above"> <div class="field__label">Author legacy</div> <div class="field__item">Romi Levine</div> </div> <div class="field field--name-field-topic field--type-entity-reference field--label-above"> <div class="field__label">Topic</div> <div class="field__item"><a href="/news/topics/city-culture" hreflang="en">City &amp; Culture</a></div> </div> <div class="field field--name-field-story-tags field--type-entity-reference field--label-hidden field__items"> <div class="field__item"><a href="/news/tags/toronto-city-council" hreflang="en">Toronto City Council</a></div> <div class="field__item"><a href="/news/tags/budget" hreflang="en">Budget</a></div> <div class="field__item"><a href="/news/tags/imfg" hreflang="en">IMFG</a></div> <div class="field__item"><a href="/news/tags/enid-slack" hreflang="en">Enid Slack</a></div> <div class="field__item"><a href="/news/tags/geography-and-planning" hreflang="en">Geography and Planning</a></div> <div class="field__item"><a href="/news/tags/munk-school-global-affairs-public-policy" hreflang="en">Munk School of Global Affairs &amp; Public Policy</a></div> <div class="field__item"><a href="/news/tags/faculty-arts-science" hreflang="en">Faculty of Arts &amp; Science</a></div> </div> <div class="clearfix text-formatted field field--name-body field--type-text-with-summary field--label-hidden field__item"><p>Torontonians are not expected to see big tax hikes in 2017 as the city tries&nbsp;to close its $91-million budget gap, while&nbsp;grappling&nbsp;with $33 billion in unfunded capital projects.</p> <p>Toronto City Manager <strong>Peter Wallace</strong> presented the preliminary operating and capital budgets today at a City Hall committee meeting. The proposed 2017 budget includes&nbsp;a two-per-cent increase in property tax and a 10-cent hike for TTC fares.</p> <h3><a href="http://www.toronto.ca/legdocs/mmis/2016/bu/bgrd/backgroundfile-98984.pdf">Read the full budget proposal here&nbsp;</a></h3> <p>The city is on the lookout for alternate forms of revenue with Mayor John Tory proposing a road toll for&nbsp;the Gardiner Expressway and Don Valley Parkway – a move that could bring in more than $200 million annually, but may not be fully implemented until&nbsp;2024.&nbsp;</p> <p>There are also some short-term revenue recommendations in the proposed budget including reinstating the personal vehicle tax and introducing a hotel tax. &nbsp;</p> <h3><a href="/news/mayor-tory%E2%80%99s-gardiner-dvp-toll-good-toronto-says-u-t%E2%80%99s-enid-slack">Enid Slack weighs in on Tory’s toll proposal&nbsp;</a></h3> <p>As City Council begins debating&nbsp;the proposed budget,&nbsp;<em>οNews</em> spoke with city experts <strong>Matti Siemiatycki </strong>and <strong>Enid Slack</strong> about how Toronto should handle its financial and operational woes.&nbsp;</p> <hr> <h3><strong>Enid Slack is&nbsp;director of the Institute on Municipal Finance &amp; Governance (IMFG) at U of T’s Munk School of Global Affairs</strong></h3> <p><strong>What do you make of the 2017 preliminary budget?</strong></p> <p>I think this is the same problem we see every year at budget time in the city of Toronto. We come to the point where there is a gap – this year it's $91 million. I think it's telling us we have a bit of a structural problem here.&nbsp;</p> <p>We seem to have this problem with the gap, and in the short run, there's only two ways to deal with it. If our expenditures are greater than our revenue, we either have to cut back our expenditures or we have to increase our revenues, and so that's what this budget is trying to do. It's trying to cut expenditures and find some way to increase revenues.&nbsp;</p> <p>In the work we did more recently, we talked about how over the long term we have to think about whether the property tax and the land transfer tax are sufficient to meet the&nbsp;growing expenditure needs of a large city like Toronto, and we concluded that they aren't enough. In&nbsp;Toronto and other major cities in Canada, we need to look at other sources of tax revenue.&nbsp;</p> <p><strong>Is this budget addressing both the short-term and long-term revenue needs for the city?</strong></p> <p>This budget is I think focusing more on the short-term fix in the context of understanding that in the long term we have to do something bigger. Some of the recommendations on municipal land transfer tax or personal vehicle tax may be short-term solutions. I think it really does both.</p> <p>The biggest problem here is that the major source of revenue for cities in Canada like Toronto is the property tax, and the city has made a commitment to only raise property tax by the rate of inflation or less than the rate of inflation. I think, while I understand the politics behind doing that, it does put the city in a bind in terms of trying to balance its budget.</p> <p><strong>Why the resistance to increase property taxes?</strong></p> <p>The property tax is a very visible tax. If you look at other taxes, like the income tax or sales taxes, they're much less visible. Most people who are on salary, for example, don't know what they&nbsp;paid in income taxes last year.</p> <p>When it comes to sales taxes, we know we pay 13 per cent, but nobody knows at the end of the year, how much they put out in sales taxes. But people do know what their property taxes are – this is money they have to pay maybe twice or six or twelve times a year. It's very visible. That's very good from an accountability point of view – people know what they're paying to their local governments, and they know what services they're getting. But that visibility makes it very hard to increase those taxes.</p> <hr> <h3><strong>Matti Siemiatycki is an associate professor of geography and planning at&nbsp;the Faculty of Arts &amp; Science</strong></h3> <p><strong>Is tolling the right way to go?</strong></p> <p>We had a lot of conversations over the last number of years about what to build,&nbsp;where to build and how to build it. The part that's always been missing is how we're going to pay for all of this investment and all of this infrastructure. I&nbsp;think the conversation about tolls is really the next phase, which is the hard part of the conversation.</p> <p>You've heard all sorts of responses to this – one of which is that it's not enough, and it's too far down the road. If we're really looking at 2024, that's a lot of years between now and then that have to be bridged. If you look at how much money they raise, which is somewhere in the $200-million- to $250-million-a-year range, that's a starting point but the gap on the operating side annually is far larger than that, and the gap on the capital side is extremely large.&nbsp;</p> <p>What I would ask people is, if you don't like this tool, if you don't like tolls, how else are we going to raise the big dollars to pay for the infrastructure that I think there's a consensus that we need?&nbsp;</p> <p><strong>What’s the alternative?</strong></p> <p>There are a fairly small handful of taxes and revenue tools that will generate large amounts of money and for various reasons&nbsp;a lot of those are also unpalatable for people. If it's not tolls, then what&nbsp;are the other options? It's a fairly short list.&nbsp;</p> <p>One option is a fairly significant property tax increase, another option is a city-wide sales tax, which the city doesn't have the capacity to levy themselves –&nbsp;they'd have to get provincial permission, another is a commercial parking levy and a local income tax.&nbsp;</p> <p><strong>Fixing the Gardiner Expressway is now estimated to cost $1 billion more than expected – is this another hiccup for Toronto infrastructure spending?</strong></p> <p>That's been one of the frustrations – the budgeting and delivery has been challenging for a lot of big projects. That’s really part of what we need to address in this region and in Canada more broadly. We have an issue with how we pay for infrastructure, that's true, but we also have an issue with how we deliver the projects once we select them and once we actually decide to proceed.</p> <p>That's proving to be frustrating for people and it's sapping public confidence and trust that government, if we decide to give them more money, can actually deliver on these projects efficiently and in a cost-effective manner.&nbsp;</p> <p><strong>In terms of transportation, what would you like to see Toronto focus on in 2017?</strong></p> <p>You really have two things going on at the same time – one is the long-range planning and the big visionary projects – the subways, the light rail lines, the bus rapid transit project, the really definitive city building initiatives.&nbsp;</p> <p>There's a big planning push that's going to happen, but we also have the day-to-day operations of our system – we have, on the one hand, discussions of mega-projects that are costing billions and on the other hand, we have the TTC and other city agencies under a request of a 2.6-per-cent budget cut. What I want to see is at the same time that we're planning the mega-projects, we're also figuring out how to put the operations of the service that people use on a solid footing and to make sure those budgets are in place.</p> <p>One step in the right direction is the low-income transit pass, which the executive committee last week looked at and approved. That, to me, is a really important step. Transit is a key barrier for people with low incomes – a barrier to jobs, a barrier to health care, a barrier to being a part of the city. I think that&nbsp;bringing in a pass is really an important step for the city to ensure that accessibility is available to those who are really in need.&nbsp;</p> </div> <div class="field field--name-field-news-home-page-banner field--type-boolean field--label-above"> <div class="field__label">News home page banner</div> <div class="field__item">Off</div> </div> Tue, 06 Dec 2016 20:22:15 +0000 Romi Levine 102715 at Mayor Tory’s Gardiner, DVP toll good for Toronto, says U of T’s Enid Slack /news/mayor-tory-s-gardiner-dvp-toll-good-toronto-says-u-t-s-enid-slack <span class="field field--name-title field--type-string field--label-hidden">Mayor Tory’s Gardiner, DVP toll good for Toronto, says U of T’s Enid Slack </span> <div class="field field--name-field-featured-picture field--type-image field--label-hidden field__item"> <img loading="eager" srcset="/sites/default/files/styles/news_banner_370/public/2016-11-24-dvp-lead.jpg?h=8c4bd285&amp;itok=JWhUPb-k 370w, /sites/default/files/styles/news_banner_740/public/2016-11-24-dvp-lead.jpg?h=8c4bd285&amp;itok=D4mbliCC 740w, /sites/default/files/styles/news_banner_1110/public/2016-11-24-dvp-lead.jpg?h=8c4bd285&amp;itok=DWlymQy- 1110w" sizes="(min-width:1200px) 1110px, (max-width: 1199px) 80vw, (max-width: 767px) 90vw, (max-width: 575px) 95vw" width="740" height="494" src="/sites/default/files/styles/news_banner_370/public/2016-11-24-dvp-lead.jpg?h=8c4bd285&amp;itok=JWhUPb-k" alt="Photo of DVP"> </div> <span class="field field--name-uid field--type-entity-reference field--label-hidden"><span>Romi Levine</span></span> <span class="field field--name-created field--type-created field--label-hidden"><time datetime="2016-11-24T14:44:25-05:00" title="Thursday, November 24, 2016 - 14:44" class="datetime">Thu, 11/24/2016 - 14:44</time> </span> <div class="clearfix text-formatted field field--name-field-cutline-long field--type-text-long field--label-above"> <div class="field__label">Cutline</div> <div class="field__item">Traffic snarls on the Don Valley Parkway test drivers' patience (photo by Jess via Flickr) </div> </div> <div class="field field--name-field-author-reporters field--type-entity-reference field--label-hidden field__items"> <div class="field__item"><a href="/news/authors-reporters/romi-levine" hreflang="en">Romi Levine</a></div> </div> <div class="field field--name-field-author-legacy field--type-string field--label-above"> <div class="field__label">Author legacy</div> <div class="field__item">Romi Levine</div> </div> <div class="field field--name-field-topic field--type-entity-reference field--label-above"> <div class="field__label">Topic</div> <div class="field__item"><a href="/news/topics/city-culture" hreflang="en">City &amp; Culture</a></div> </div> <div class="field field--name-field-story-tags field--type-entity-reference field--label-hidden field__items"> <div class="field__item"><a href="/news/tags/toronto" hreflang="en">Toronto</a></div> <div class="field__item"><a href="/news/tags/transportation" hreflang="en">Transportation</a></div> <div class="field__item"><a href="/news/tags/imfg" hreflang="en">IMFG</a></div> <div class="field__item"><a href="/news/tags/economy" hreflang="en">Economy</a></div> <div class="field__item"><a href="/news/tags/taxes" hreflang="en">Taxes</a></div> <div class="field__item"><a href="/news/tags/enid-slack" hreflang="en">Enid Slack</a></div> <div class="field__item"><a href="/news/tags/city" hreflang="en">City</a></div> <div class="field__item"><a href="/news/tags/tolls" hreflang="en">Tolls</a></div> </div> <div class="clearfix text-formatted field field--name-body field--type-text-with-summary field--label-hidden field__item"><p>Toronto Mayor John Tory announced plans to implement a $2 road toll for&nbsp;the Gardiner Expressway and Don Valley Parkway today, hoping to generate much-needed income for the city.</p> <p>The highways carry thousands of commuters in and out of the city each day, but Tory said the tolls&nbsp;would raise $200 million every year – funds that could then be used for&nbsp;transit costs and expansion projects.&nbsp;With&nbsp;$33 billion in unfunded capital projects, the city is in need of a new source of revenue, he said.&nbsp;</p> <p>Tory also proposed&nbsp;a number of cost-cutting measures such as a hotel tax and a 2.6-per-cent reduction in the operating budget&nbsp;of city divisions like police and libraries.&nbsp;</p> <p>U&nbsp;of T's Institute on Municipal Finance &amp; Governance (IMFG), which is part of the Munk School of Global Affairs,&nbsp;<a href="http://munkschool.utoronto.ca/imfg/uploads/368/imfgperspectives_no15_kitchenandslack_nov_23_2016.pdf">released a paper</a> this week outlining different taxing options for cities like Toronto in order to generate revenue. &nbsp;</p> <p><em>οNews</em> spoke with <strong>Enid Slack</strong>, IMFG director and co-author of the report about Tory’s toll proposal and alternative revenue sources. &nbsp;</p> <hr> <p><strong>Why does Toronto need more sources of revenue?&nbsp;</strong></p> <p>What we've talked about in our paper is really the demands on municipal expenditures and how they've changed over the last 30 years – so for things like roads and transit, investing in infrastructure that's deteriorating, investing in new infrastructure. Our cities over the last 30 years are more interested in being more internationally competitive and that means not only providing water, sewer, roads and the traditional services but also making our cities very livable so we can attract young, skilled workers. Frankly, they can go anywhere, but we want them to come here.&nbsp;</p> <p>The list goes on and on for&nbsp;the expenditure side of the budget, but when we get to the revenue side and look over the last 30 years, nothing much has changed. Cities in Canada have property taxes, user fees and some provincial and federal transfers so the time has come to think about what other sources of revenue are appropriate for cities.</p> <p>When we looked at cities around the world – they all have other sources of revenue. They are not reliant on property taxes as their only source of revenue.</p> <p>This is not as bold as you might think. Other cities are doing this, and other cities have tolls on their major roads.</p> <p><strong>Other than generating income, what are the benefits to introducing road tolls?</strong></p> <p>The obvious benefit is to reduce congestion so that fewer people will get in their cars – maybe they'll carpool or maybe they'll take transit. It has a lot of time benefits for people and environmental benefits – less pollution, fewer health care costs as a result, fewer accidents, less policing costs. There are a whole lot of benefits over and above just the revenue.&nbsp;</p> <p>The point with tolls is that the users of the road are paying for it – whether they live in Toronto or somewhere&nbsp;else. And if the money is put into improving the roads or into transit, everybody benefits as well.</p> <p><strong>Tory also proposed a hotel tax during today’s announcement – an initiative included in the IMFG paper – what can this kind of levy provide for the city?&nbsp;</strong></p> <p>Hotel tax has advantages because it's a tax on visitors. When visitors come to the city, they use services. They walk on the streets. They use parks and policing services, and they don't pay any taxes in Toronto. A hotel tax is a way to get tourists to pay for some of the services they use when they're in the city. Other cities in Canada have hotel taxes – Vancouver, other B.C. municipalities, Montreal, Charlottetown. When you look around the world, many cities have hotel taxes.&nbsp;</p> <p><strong>How can Torontonians be convinced that increased taxes or taxes on more services will benefit them in the long-run?&nbsp;</strong></p> <p>We shouldn't start the conversation with taxes. We should start the conversation with what's our vision for cities in Canada. What do we want to see? People know what they want. They want good services. They want good transit. They want roads that aren't congested. They want parks. They want libraries. And&nbsp;we have to pay for them. If they have some understanding that those taxes are paying for these services, that they are getting something for their taxes, I&nbsp;think they're less unwilling to pay taxes.</p> <p><strong>Some politicians will also need convincing that taxes are a good idea. How can that be done? &nbsp;</strong></p> <p>If we want a great city, we all have to understand – citizens and politicians – that we will have to pay for it. If we don't, our cities will crumble. Infrastructure will deteriorate. The services won't be very good, and people won't be very happy when that happens.&nbsp;</p> </div> <div class="field field--name-field-news-home-page-banner field--type-boolean field--label-above"> <div class="field__label">News home page banner</div> <div class="field__item">Off</div> </div> Thu, 24 Nov 2016 19:44:25 +0000 Romi Levine 102572 at City Manager Peter Wallace warns of Toronto’s “risky behaviour” at οevent /news/city-manager-peter-wallace-warns-toronto-risky-behaviour-u-t-event <span class="field field--name-title field--type-string field--label-hidden">City Manager Peter Wallace warns of Toronto’s “risky behaviour” at οevent</span> <div class="field field--name-field-featured-picture field--type-image field--label-hidden field__item"> <img loading="eager" srcset="/sites/default/files/styles/news_banner_370/public/Wallace.jpg?h=afdc3185&amp;itok=Fg_zuqyY 370w, /sites/default/files/styles/news_banner_740/public/Wallace.jpg?h=afdc3185&amp;itok=uGGELdwT 740w, /sites/default/files/styles/news_banner_1110/public/Wallace.jpg?h=afdc3185&amp;itok=28OZYbO- 1110w" sizes="(min-width:1200px) 1110px, (max-width: 1199px) 80vw, (max-width: 767px) 90vw, (max-width: 575px) 95vw" width="740" height="494" src="/sites/default/files/styles/news_banner_370/public/Wallace.jpg?h=afdc3185&amp;itok=Fg_zuqyY" alt="photo of Peter Wallace"> </div> <span class="field field--name-uid field--type-entity-reference field--label-hidden"><span>Romi Levine</span></span> <span class="field field--name-created field--type-created field--label-hidden"><time datetime="2016-10-20T09:30:49-04:00" title="Thursday, October 20, 2016 - 09:30" class="datetime">Thu, 10/20/2016 - 09:30</time> </span> <div class="clearfix text-formatted field field--name-field-cutline-long field--type-text-long field--label-above"> <div class="field__label">Cutline</div> <div class="field__item">Photo by Nicolett Jakab</div> </div> <div class="field field--name-field-author-reporters field--type-entity-reference field--label-hidden field__items"> <div class="field__item"><a href="/news/authors-reporters/romi-levine" hreflang="en">Romi Levine</a></div> </div> <div class="field field--name-field-author-legacy field--type-string field--label-above"> <div class="field__label">Author legacy</div> <div class="field__item">Romi Levine</div> </div> <div class="field field--name-field-topic field--type-entity-reference field--label-above"> <div class="field__label">Topic</div> <div class="field__item"><a href="/news/topics/city-culture" hreflang="en">City &amp; Culture</a></div> </div> <div class="field field--name-field-story-tags field--type-entity-reference field--label-hidden field__items"> <div class="field__item"><a href="/news/tags/toronto-city-council" hreflang="en">Toronto City Council</a></div> <div class="field__item"><a href="/news/tags/imfg" hreflang="en">IMFG</a></div> <div class="field__item"><a href="/news/tags/munk-school-global-affairs-public-policy" hreflang="en">Munk School of Global Affairs &amp; Public Policy</a></div> <div class="field__item"><a href="/news/tags/economy" hreflang="en">Economy</a></div> <div class="field__item"><a href="/news/tags/budget" hreflang="en">Budget</a></div> <div class="field__item"><a href="/news/tags/faculty-arts-science" hreflang="en">Faculty of Arts &amp; Science</a></div> <div class="field__item"><a href="/news/tags/cities" hreflang="en">Cities</a></div> <div class="field__item"><a href="/news/tags/toronto" hreflang="en">Toronto</a></div> </div> <div class="field field--name-field-subheadline field--type-string-long field--label-above"> <div class="field__label">Subheadline</div> <div class="field__item">Annual IMFG Toronto city manager’s address tackled Toronto's financial future</div> </div> <div class="clearfix text-formatted field field--name-body field--type-text-with-summary field--label-hidden field__item"><p>As Toronto continues to grow, so does the city’s budget pressures.</p> <p>The city not only&nbsp;has to provide residents with public services, but it also&nbsp;has to&nbsp;invest&nbsp;in infrastructure – all while trying not to overspend and overpromise. That balancing act&nbsp;largely falls on the shoulders of&nbsp;Toronto City Manager <strong>Peter Wallace</strong>.</p> <p>Wallace&nbsp;spoke&nbsp;this week&nbsp;at the annual city manager’s address, hosted by the&nbsp;Munk School of Global Affairs’ Institute on Municipal Finance and Governance. A οalumnus,&nbsp;Wallace, who is in charge of a city staff of 30,000 and a $12-billion operating budget,&nbsp;outlined Toronto’s&nbsp;key challenges ahead of the 2017 budget announcement.&nbsp;&nbsp;</p> <p>The οevent was moderated by former city manager&nbsp;<strong>Shirley Hoy</strong>, chair of the university’s governing council. She says these challenges&nbsp;are ones “all municipalities in Ontario, and indeed, in Canada, are currently considering.”</p> <p>Here’s what Wallace&nbsp;had to say about Toronto’s financial future:</p> <h4><strong>Projects that are&nbsp;funded</strong></h4> <p>In a very real way, policy intention in the city is not that important. It’s not passion or rhetoric, or where we try and lead. It’s what we actually do, and what we actually do as a city. The expression of the values is what we actually fund.&nbsp;</p> <p>It’s not just a question of whether or not city staff and city council feel that we are doing the right thing. It’s really a question of are we doing the right thing, and are we conducting our financial affairs in a way that is respectful and sustainable for future generations, and in a way that actually has the impacts that we are purporting to have.&nbsp;</p> <h4><strong>How Toronto is doing financially&nbsp;&nbsp;</strong></h4> <p>I do want to emphasize that in a very fundamental way, the city is doing very, very well.</p> <p>The City of Toronto is a great place to live, play, invest…We’re seeing that in terms of the economic importance in the place and just the vitality of this city. The influx of people, our ability to work together – it really is quite amazing. And, this is a town that’s booming. This is a great place at a great time.&nbsp;</p> <h4><strong>On whether Toronto is saving enough</strong></h4> <p>Last year, the City of Toronto saved $200 million. I’m proud of our system’s ability to consistently save money over a period of time.</p> <p>It’s getting increasingly hard to rely on savings. Even during the peak era of [former mayor Rob] Ford, when we made savings that were clearly unacceptable to council, because it reversed itself on those at the earliest opportunities, we were not able to get savings that actually offset the overall growth in the size of the funding envelope.&nbsp;</p> <p>Savings, austerity&nbsp;–&nbsp;absolutely a critical tool, absolutely not sufficient. It’s not the way to get out of this.</p> <h4><strong>Property taxes</strong></h4> <p>There is a core reality that for its entire history, the city council of the amalgamated City of Toronto has placed a very high priority on low property taxes, and that’s likely to continue over the next little while.&nbsp;</p> <p>We are really, truly struggling with the demands of density and the transit associated with that, and the demands of poverty and&nbsp;social cohesion. We are actually ending up in a situation where we are transmitting risk across generations, across certain classes of people to whom we do not want to translate risk.&nbsp;</p> <p>Had we actually raised property tax&nbsp;every year at the rate of economic growth, we might actually have that capacity. We didn’t. &nbsp;We don’t. It’s a gap, and we will have to address it.</p> <h4><strong>Mitigating risk</strong></h4> <p>Doctors will bother people about smoking and suggest that smoking isn’t a good idea, and a lot of smokers have the idea that, ‘I’m still here. I was here last year.&nbsp;I’m here this year, and smoking is OK because it hasn’t killed me yet.’ The reality is, whether it’s smoking, or whether or not you live in B.C. and like to ski during avalanche terrain every winter, every day,&nbsp;these things are risky behaviours, and they might well catch up.&nbsp;</p> <p>I’m a public servant, and I take risk with great seriousness. I advise that risk should be mitigated, managed and minimal. Right now, we are very heavy smokers in the City of Toronto. The sooner we quit, the sooner we step away, the sooner we restore that functionality.</p> <p>We do need to have that dialogue around the sustainability of public finances, and it needs to be a realistic and direct dialogue. And&nbsp;the statistical evidence is, ‘I smoked this year.&nbsp;I’m likely to be around next year.’ Yes, of course. But that’s not really the test. The test:&nbsp;are you healthy, are you sustainable, is it wise, and is it appropriate management on behalf of the broader public of overall risk.&nbsp;</p> <h4><strong>Challenges ahead for 2017</strong></h4> <p>Seventeen is going to be a little bit challenging. Some of the conversations we’re going to end up having about revenue aren’t just going to be around making the world better. They’re not just going to be about making new investments. They’re actually going to be about filling the gap between what council has endorsed and is doing now, and the resources we actually have available to fund that.&nbsp;</p> <p>The challenge with sustainability, like the challenge with smoking, is that it does hurt you. We are probably past&nbsp;the time right now where we can reasonably kick the can down the road.&nbsp;</p> <h3><a href="http://www.thestar.com/news/city_hall/2016/10/17/toronto-cant-cut-our-way-out-of-budget-woes-city-manager-warns.html">Read more about Wallace’s address in the <em>Toronto Star </em>&nbsp;</a></h3> </div> <div class="field field--name-field-news-home-page-banner field--type-boolean field--label-above"> <div class="field__label">News home page banner</div> <div class="field__item">Off</div> </div> Thu, 20 Oct 2016 13:30:49 +0000 Romi Levine 101477 at Can Toronto meet growing demand for services with existing resources? /news/can-toronto-meet-growing-demand-services-existing-resources <span class="field field--name-title field--type-string field--label-hidden">Can Toronto meet growing demand for services with existing resources?</span> <span class="field field--name-uid field--type-entity-reference field--label-hidden"><span>sgupta</span></span> <span class="field field--name-created field--type-created field--label-hidden"><time datetime="2015-10-15T13:31:16-04:00" title="Thursday, October 15, 2015 - 13:31" class="datetime">Thu, 10/15/2015 - 13:31</time> </span> <div class="clearfix text-formatted field field--name-field-cutline-long field--type-text-long field--label-above"> <div class="field__label">Cutline</div> <div class="field__item">City Manager Peter Wallace addresses the Institute on Municipal Finance &amp; Governance at ο(all photos by Johnny Guatto)</div> </div> <div class="field field--name-field-author-reporters field--type-entity-reference field--label-hidden field__items"> <div class="field__item"><a href="/news/authors-reporters/alan-christie" hreflang="en">Alan Christie</a></div> </div> <div class="field field--name-field-author-legacy field--type-string field--label-above"> <div class="field__label">Author legacy</div> <div class="field__item">Alan Christie</div> </div> <div class="field field--name-field-topic field--type-entity-reference field--label-above"> <div class="field__label">Topic</div> <div class="field__item"><a href="/news/topics/city-culture" hreflang="en">City &amp; Culture</a></div> </div> <div class="field field--name-field-story-tags field--type-entity-reference field--label-hidden field__items"> <div class="field__item"><a href="/news/tags/top-stories" hreflang="en">Top Stories</a></div> <div class="field__item"><a href="/news/tags/taxes" hreflang="en">Taxes</a></div> <div class="field__item"><a href="/news/tags/munk-school-global-affairs-public-policy" hreflang="en">Munk School of Global Affairs &amp; Public Policy</a></div> <div class="field__item"><a href="/news/tags/imfg" hreflang="en">IMFG</a></div> <div class="field__item"><a href="/news/tags/cities" hreflang="en">Cities</a></div> <div class="field__item"><a href="/news/tags/alumni" hreflang="en">Alumni</a></div> </div> <div class="field field--name-field-subheadline field--type-string-long field--label-above"> <div class="field__label">Subheadline</div> <div class="field__item">City manager, οpresident talk taxes, growth and why citizens want more for less</div> </div> <div class="clearfix text-formatted field field--name-body field--type-text-with-summary field--label-hidden field__item"><p>Should Toronto implement more revenue tools, including a sales tax, to help meet the growing demand for services and to address the problems of its citizens who are not benefiting from the city’s success?</p> <p>The question was the focus of a session sponsored by the Institute on Municipal Finance &amp; Governance (IMFG) at the George Ignatieff&nbsp;Theatre on Oct. 14.</p> <p>Alumnus&nbsp;<strong>Peter Wallace</strong>, Toronto’s new city manager, spoke to an audience of what President <strong>Meric Gertler</strong> called “an A-list gathering of city builders” and was interviewed by Gertler afterwards. (<a href="http://news.utoronto.ca/photo_gallery?photoset_id=72157659522211288">See a photo gallery from the event</a>.)</p> <p><strong>Enid Slack</strong>, director of the institute at the Munk School of Global Affairs, opened the session by noting that while Toronto has revenue tools such as property taxes, user fees, the land transfer tax and a billboard tax, “as we look around the world we see that other major cities have access to a broader mix of taxes, and the question we always ask is here is can Toronto remain fiscally healthy without the ability to levy other taxes?”</p> <p>Wallace, a former senior civil servant in the Ontario government and city manager since last July, then gave an outline of the city’s fiscal situation and&nbsp;talked about the “standard dilemma” government officials face: “Give us (citizens) more for less.”</p> <p>People want more transit, better environmental protection and more public safety, but are really uncomfortable paying more taxes to get them, he&nbsp;said.</p> <p>Wallace, who holds both a BA in political economy and an MA in public administration from U of T, then sat down with Gertler in a question and answer session.&nbsp;</p> <p>Gertler said that “other cities around the world do indeed levy a pretty broad range of taxes….I think folks in this room would argue that there is capacity for the city to do more in this regard.”</p> <p>The president asked: “Does Toronto need to consider levying other kinds of taxes, and if so, what approach should one use” to make that happen?</p> <p>Wallace said from his&nbsp;perspective “it doesn’t start with revenue tools” but rather a commitment from local politicians on what core investments they want to make. “You have to make wise choices otherwise it is just considered a tax grab.”</p> <p>He noted that Toronto “does not yet have access to progressive revenues…we have a property tax that in its structure has the potential to be regressive.”</p> <p>Wallace also took questions from the audience and one came from alumna <strong>Anne Golden</strong>, the former head of the Conference Board of Canada and ex-president of the United Way of Greater Toronto.<br> <img alt="photo of Anne Golden" src="/sites/default/files/2015-10-14-IMFG%20City%20Manager%20Address-Anne%20Golden.jpg" style="width: 600px; height: 400px; margin: 5px 25px;"></p> <p>A study conducted by the conference board about the “fiscal gap” in the city concluded that “we needed access to a growth tax,” Golden said. She added that from her perspective, after working for the United Way for 20 years, it is clear that many Torontonians aren’t benefiting from the growth in the city, especially those in public housing. &nbsp;</p> <p>“If you put those two perspectives together, it does seem to me you need to look a revenue changes to keep the city sustainable.” &nbsp;</p> <p>Her personal favourite, she said, is a “small sales tax,” not large enough to dissuade people from buying but large enough to raise meaningful revenue.&nbsp;</p> <p>Wallace said there needs to be a “reality-based conversation” about such revenue tools, but noted that the land transfer tax has brought in $500 million to the city, “radically over-performing expectations.” &nbsp;</p> <p>Gertler said some American cities are holding referenda to ask citizens whether they would support new tax increases for specific spending priorities, “as a way of building confidence among the electorate that indeed money is being used for a specific purpose, (so that it is) less an act of faith on behalf of the voter and more a social contract to deliver better transit, or for example, better library services.”</p> <p>The president asked Wallace: “Can you ever imagine these kinds of ballot initiatives coming&nbsp;to Toronto?<span style="font-size: 12px; line-height: 18px;">”</span></p> <p><img alt="photo of Meric Gertler and Peter Wallace at microphone" src="/sites/default/files/2015-10-14-IMFG-City-Manager-Address-President-Gertler.jpg" style="width: 600px; height: 400px; margin: 5px 25px;"></p> <p>Wallace said “that is not something that comes naturally to me” and suggested there are enough existing mechanisms to deal with allocating money for city projects.&nbsp;</p> <p>In terms of city borrowing money to fund major projects, Gertler said “many people have suggested that this is a good time to take on debt given the state of interest rates…is it not time to reconsider the city’s debt strategy?”</p> <p>Wallace said increasing debt “won’t buy you as much as you think it will, even at low interest rates.”&nbsp;</p> <p>The president summarized the debate by saying “many of the problems that we have stem from the success of the city…we are fortunate to have considerable growth but in the future it can’t be taken for granted, and even&nbsp;with growth we still face pressing needs in terms of services and infrastructure.”</p> <p>Gertler said it is critical that the city address these issues “to ensure that we don’t kill the goose that is laying the golden eggs.”</p> <p>One of the president’s main priorities is to work more closely with its partners in the Toronto region, to the mutual benefit of both parties.</p> <h2><a href="http://threepriorities.utoronto.ca/">Read more about Cities and the 3&nbsp;Priorities</a></h2> <p>“A goal is to make the imaginary boundary around the University more porous, easier to transcend, as a way of fostering collaboration and partnership,” he told the audience. &nbsp;</p> <p>In that vein, Gertler asked “how do we start a larger conversation about what the city needs to do,” with other organizations “such as the one in which we sit, playing a part to convene that conversation?”</p> <p>Wallace said he agreed that οcould play an “enormously important role in that discussion,” since it is both a “place for inspiration and a source of talent” that the city could use in deciding its future. &nbsp;</p> </div> <div class="field field--name-field-news-home-page-banner field--type-boolean field--label-above"> <div class="field__label">News home page banner</div> <div class="field__item">Off</div> </div> <div class="field field--name-field-picpath field--type-string field--label-above"> <div class="field__label">picpath</div> <div class="field__item">sites/default/files/2015-10-14-Peter-Wallace-City-Manager-IMFG.jpg</div> </div> Thu, 15 Oct 2015 17:31:16 +0000 sgupta 7355 at