🔭 PLATFORM VIEW: The Canadian Taxpayers Federation’s “Spending cuts must be put on table in Toronto’s mayoral election” position
🔗 LINK: torontosun.com/opinion/columnists/jay-g…
🔧 DOABLE? Not without serious service impacts.
💰 COSTED? With incorrect math.
✨ OVERALL: ⚫️ (Zero out of five)
The Canadian Taxpayers Federation, or CTF, is not a candidate in this mayoral election, but since I feel like there’s a good chance some of the conservative-leaning candidates in this race start parroting the arguments of CTF Ontario Director Jay Goldberg over the final week of the election campaign, I figured it was worth looking at this.
In an op-ed for the Toronto Sun, Goldberg argues that “Toronto has a spending problem, not a revenue problem.”
Here’s his math:
Listening to mayoral candidate pitch their platforms, you’d never know that spending has gotten so out of control. In 2018, the city budget was $11.1 billion. This year, it’s projected to be $16.2 billion. If that’s not an out-of-control municipal budget, then Canada doesn’t have cold winters.
Canada does indeed have pretty cold winters — though overall Toronto’s winters have been getting less cold — but the presentation of Toronto’s municipal budget as out-of-control here is based on comparing apples and oranges.
I’m sympathetic to the misunderstanding. The way City Hall presents its budgets is still more confusing and technical than it should be. But that doesn’t change the fact that Goldberg’s numbers are fundamentally wrong.
Here’s the root of the problem: City Hall actually passes two annual operating budgets. One is the so-called “levy operating budget” that includes all services that are paid for at least in part by property taxes. The other is the “rate-supported operating budget” that includes a trio of programs almost entirely funded by user fees: garbage collection, Toronto Water, and the Toronto Parking Authority.
Typically, the rate-supported budget is passed in the fall, while the levy budget is considered and passed the following February. Following a municipal election, however — like the one we had last fall — they are both considered in February.
So Goldberg is comparing a levy budget for 2018 with a combined levy and rate budget for 2023.
An accurate comparison, if you just want to compare the levy budgets would be:
2018: $11.2 billion
2023: $14.1 billion.
If you want to compare levy and rate budgets for each year, the comparison is:
2018: $13 billion
2023: $16.2 billion.
Comparing those figures to the Canadian Inflation Calculator suggests the 2023 budget has grown by about $1 billion more than the rate of inflation.
But even that’s a bit misleading, as much of the operating budget is made up of federal and provincial pass-through funding. Combined federal and provincial revenue represented about 18% of Toronto’s 2018 budget, compared to 26% of the 2023 budget, for example. (Though some of those contributions are actually requests for additional COVID funding.)
If you just want to compare property tax revenue devoted to operating spending, the comparison looks like this:
2018: $4.2 billion
2023: $4.9 billion
That is a very close match with the rate of inflation, which makes sense because inflationary operating budget property tax increases were John Tory’s whole deal. He talked about it a lot.
Since the city can’t run operating deficits, it would have been nearly impossible for Tory to dramatically ratchet up the city’s discretionary spending without also increasing property taxes.
These numbers can all be verified by looking at the City of Toronto’s Budget Books for the years in question. They’re not in dispute. Any candidate who cites them on a debate stage, on social media, or in a platform proposal is badly misinformed. Be warned.
PLATFORM VIEW is a daily(ish) feature by City Hall Watcher on Substack Notes. Got a request for a candidate policy proposal I should review? Let me know.