City
"Recession Budget" Calls For Tax Increase
At a press conference this morning, Mayor David Miller unveiled his $8.7 billion 2009 budget, which is set to go before city council at its meeting on March 31 and April 1. The most controversial aspect of the budget is a 4% residential property tax increase. The city's take from property taxes will only increase by 2.5%, since business property tax rates are being increased by only 2%, as part of the Mayor's broader plan to keep business tax rates down.
The Mayor listed higher costs for policing, snow removal, transit, and welfare as the principal factors forcing the tax increase. The "recession budget," as Miller dubbed it, increases spending on welfare by $30 million, budgeting for an average 90,000 recipients per month. There are approximately 80,000 current recipients, with a projected 100,000 at year's end. Plans to cancel or defer tax increases for low-income earners and seniors are being expanded, with another 22,000 families able to qualify.
In his opening remarks [pdf], Miller said he was elected to "preserve municipal services, protect the most vulnerable, and build a 21st century city." He argued that the only way to avoid a tax increase would be to cut close to an additional $100 million from the budget. "The result would be a city in decline, unable to compete when it is most important that we do."
Prior to the unveiling, Councillor Denzil Minnan-Wong (Don Valley East) criticized what was then the expected tax increase, arguing that along with increased user fees and other expenses, the average homeowner will actually be paying 10 per cent more in taxes this year. "That's part of the fiction of a 4% tax increase, it's more like a 10% tax increase. You take the 9% water increase, the garbage tax, the motor vehicle registration tax -- and that doesn't even take into account the land transfer tax." Mayor Miller specified in his press conference that there would be no increase in the land transfer tax.
Councillor Karen Stintz (Eglinton Lawrence) also took issue with the budget: "since I've been a councillor, the budget has grown by $1.7-billion and the residents in the city cannot point to a material improvement in their life for that money. If they were able to, we might be able to justify all these increases."
So what do you think? Is the Mayor right in saying that the tax increase is necessary in the face of increased costs? Should business property tax rates be increased by the same percentage as residential rates? Is Councillor Stintz right, or can you point to material improvements in your life resulting from increased city budgets? If you'd like more information, watch Mayor Miller's press conference, or have a look at the budget for yourself.
Photo by Bryson Gilbert, member of the blogTO Flickr pool.
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One minute us taxpayers are in the ring, the next minute they're slamming us through a table.
Can't we use at least part of that 30 million for to improve the city - or just not spend it in the first place and mitigate some of the damage?
a) Toronto is a large city, with large city needs. One who has far more financial/social responsibilities than a lot of neighbouring municipalities. It suffered severe downloading from the provincial government some years back, something that has never been corrected. It also saw tremendous funding short falls in prosperous times, wherein more of our tax dollars flowed out to have-not parts of the country, than returned to us.
b) the city has long required serious funding for infrastructure and capital projects. Mass transit anyone? Traffic gridlock? you name it. For years, our budgets and goals as a city should have gone up -- commensurate with federal and provincial funding of course. This hasn't happened. So it makes sense that at some point, our city budgets were going to grow (commensurate with the city itself). Is it bad timing? Perhaps. But at a time when the federal government is going to take us into an era of $84 billion deficit spending to drive stimulus, is it really a shock that the city increases their budget?
Of course, the difference between the federal govt. and Toronto council is that the federal govt CAN go into deficit. Toronto can't. So Toronto has to ask its citizens to pay now, instead of later, as the federal govt. is asking.
c) There are several other municipalities around us who have higher property taxes with far fewer services being given in return.
d) Toronto City council has long had a ruling class of incumbents. Whether you're right or left wing. They've proven to be dysfunctional and slow, and seem to be far more interested in pandering to NIMBYists in their wards, and seem to get reelected based on their personal brands/issues. A good number of these people need to go, and fresh blood brought in.
It's just one meeting after another of long standing personal grudges holding the city back.
e) City Hall needs to get their own shit together. Yes, fine, $80k plant watering is a drop in the bucket for an $8.7 billion budget, but it just doesn't look or seem right. Neither does your food budgets or whatever else Rob Ford grinds his axe about. So cut it. Seriously. Cut it now. Give us all reason to believe that you are with us, and not above us. This stuff all seems to be totally non-essential. So do the right thing.
f) If your property taxes went up dramatically because you thought it wise to pay $600k for a two story detached, safely putting it on a 40yr mortgage. Don't be surprised. I know that the machinations of the housing market are vast and a whole other debate, but watching folks spend beyond their own means in the last five years was just stupid. Just as we're asking our politicians to be accountable for their actions, shouldn't we do the same?
all just food for thought. peace.
My suggestion would be to spend money encouraging people to move downtown in addition to the raised property taxes. Stop the flight of people to the 905. People who commute from the 905 leech off the system. They use many of the same city services, but don't give any money back to Toronto in the form of taxes. Instead they give their money to York Region or Mississauga or Brampton.
This is incredibly disturbing, given:
<i>c) There are several other municipalities around us who have higher property taxes with far fewer services being given in return.</i>
4% is not huge but it is symbolic of the way he runs the city. Go to the taxpayers to fund what ever he believes is good.
The city should:
1) Clearly define what the strategic and operational plans are. Outline what the priorities are and why they are priorities. Communicate some overarching themes instead of 100s of small initiatives
2) Review all activities to ensure they are as lean as possible and are being purchased right. Transperantly track the efforts / results. I am sure there are many pockets of overspending.
3) Find creative ways to get either the Federal government or private companies to pay for initiatives. (Philadelphia's garbage/recycling collection is sponsored by many companies that want to appear green like Starbucks).
Do churches pay property tax?
b) Churches are exempt from property taxes.
"f) If your property taxes went up dramatically because you thought it wise to pay $600k for a two story detached, safely putting it on a 40yr mortgage, don't be surprised. I know that the machinations of the housing market are vast and a whole other debate, but watching folks spend beyond their own means in the last five years was just stupid. Just as we're asking our politicians to be accountable for their actions, shouldn't we do the same?"
Hear hear.
If you own a house you ought to pay property taxes. If the city you chose to buy a house in decides to raise taxes, you bear some responsibility for having made the decision to live there. If you can't afford the taxes, you probably couldn't really afford buying the house in the first place.
Toronto Life's cover story this month proclaims that it's a Buyer's Market, tempting me to look at buying a house again. But a 10% drop from a ridiculous amount is still ridiculous. I still can't afford to buy a house, so I pay rent. I get so tired of people telling me how stupid it is to pay rent, and that it just goes into thin air... these same people have locked their entire present and future net worth into a 25, 35, 40 year debt.
Toronto housing prices are insane. Just watch Property Virgins when they're in the US and note how much cheaper houses are in their major metropolitan areas.
A house is a luxury. For those who claim that it's required to raise a family, consider how little space it takes to raise a family in Hong Kong or Mumbai. The desire to put every human family in a detached house is a selfish environmental catastrophe in the making.