Toronto homeowners get inflation-level tax hike as city budget passes

Council has approved an $11-billion operating budget that for the fourth year in a row keeps property taxes in line with inflation while rejecting calls to fund more shelter beds, subsidized daycare spaces and other urgent needs.

The budget passed late Monday night was much the same as the one recommended by Mayor John Tory’s executive committee, following his direction to keep taxes low, freeze spending across many divisions and fund new programs from reserve funds. The budget continues to rely on a hot housing market, which city staff and real estate experts have warned against.

Council approved Tory’s 2.1-per-cent hike in a 33-11 vote. The increase climbs to 2.91 per cent including a dedicated levy for transit and social housing. City staff say that translates into an increase of just over $82 on an average Toronto home with an assessed value of $624,418.

“I think this budget moves us forward on every single account,” Tory said at the end of the debate. He spoke repeatedly of the hope people have, including, he said, because for the first time the city will meet its targets on affordable housing.

But according to city staff, the projected number of rental units that will be created by 2020 totalled with those that have already been built will fall far short of the goal — missing the target of 10,000 units by half.

“We have a lot of work to do on addressing a lot of these issues,” Tory said. “And if I believed that simply raising property taxes was going to provide the answer, then I would say so. But I know that that can’t work by itself.”

He blamed the province for earlier blocking the city from implementing road tolls on the Gardiner Expressway and Don Valley Parkway.

A motion from Councillor Josh Matlow to request the province instead share in the harmonized sales tax, passed at council with Tory’s support. But a motion to ask, if that request were refused, the province give the city the ability to implement its own sales tax to fund transit and housing lost in a 19-23 vote, with Tory against.

The motion asked that the funding be spent based on demonstrated need using evidence-based planning.

“I think there’s only one option if we’re going to be leaders,” Matlow said ahead of the vote. “We have this moment in our lives where we could actually make a tangible difference in peoples’ lives.”

The mayor had promoted this budget as a “Goldilocks” plan striking a “just right” balance between spending on services and the fiscal restraint demanded by Torontonians.

On Monday, Councillor Mike Layton called that thinking just “dead wrong.”

“There’s no too hot or not too cold for things like shelters,” Layton said. “The budget’s not ‘just right’ when you have people sleeping outside and waiting for housing.”

The votes Monday came hours after anti-poverty activists temporarily shut down the council meeting, yelling “People are dying!” and “Open 1,000 beds now!” from the public gallery at a stone-faced Tory and his council allies seated below.

Council committed funding to the first year of a plan to create 1,000 new shelter beds over three years, with a first instalment of an additional 281 this year. But advocates say 1,000 beds are desperately needed now, with 500 more needed as soon as possible.

A motion from Councillor Kristyn Wong-Tam — who has been at the forefront of a council push for more shelter space — for staff to make efforts to expedite the creation of those 1,000 beds this year carried with Tory’s support.

The practice of setting the tax rate first, and then crafting the budget it funds, was started by then-mayor Rob Ford, and continued by Tory, as a way to limit attempts to add spending. Council then started debating what actually gets funded in the proposed $11-billion spending blueprint — the last before Tory and many of his council colleagues seek re-election in the October municipal election.

His budget chief, Councillor Gary Crawford, touted more than $50 million in new and enhanced spending, including the TTC’s new “hop-on, hop-off” transfer, the TransformTO climate-change plan, 825 new subsidized child-care spaces and 20,000 extra recreation spaces.

“To suggest that we need to raise taxes beyond the rate of inflation to invest in the city, I’m sorry that’s not correct . . . ,” he told council. “For four years in a row we’ve kept the city affordable for residents while at the same time investing millions upon millions in important services.”

But council critics of the latest of years of austerity budgets accused the mayor of pandering to homeowners at the expense of middle- and low-income Torontonians.

Councillor Gord Perks tried and failed to boost property taxes by 4 per cent, saying he is weary of arguments “that if we increase property taxes (Toronto) will not be affordable.”

“That is absolutely 100 per cent backwards, wrong, upside down and incorrect . . . ,” he added. “If my motion passes, the half of Torontonians who are tenants do better financially because child care and transit cost money and if those services aren’t available, you have to do something even more expensive — get a car, rely on private child care. When we spend public money we provide services that save people money.”

Perks noted the city hasn’t foreclosed on any Torontonians unable to pay their taxes, and said the best way to help senior citizen homeowners is to put more money into a program that cancels or postpones tax hikes for those with low incomes.

Other proposals for above-inflation tax hikes were voted down, as was Councillor Giorgio Mammoliti’s bid for a tax freeze.

The annual budget grind came to a dramatic halt soon after the meeting started when members and supporters of Ontario Coalition Against Poverty rose from their seats and began yelling. “Hey John Tory, add more beds or you’ll be sorry!” some chanted as police and security officers moved toward them and started asking people to leave.

While past similar disruptions have seen protesters start to file out after a few minutes, this time they refused to leave, and security order the entire chamber cleared. Some people were dragged out.

A woman who said she is living in a medical facility with no other permanent housing, told reporters that homeless people and advocates are fed up with austerity budgets that keep property taxes low at the expense of social service spending.

“Every successive government has passed this problem onto the next successive government since the early ‘70s, the buck has to stop somewhere,” she said shortly before everyone was ejected. “It’s not that an additional billion dollars for one (Scarborough) subway station is more important than those who are trying to live. No one should struggle on this level every day. It’s inhumane.”

With Tory’s council-supported spending freeze, the budget for most programs and services won’t even keep up with inflation — effectively mandating nearly across-the-board cuts.

Prior to council, OCAP staged a rally and speeches both outside of city hall and in the rotunda, with speakers from the Toronto Overdose Prevention Society and Health Providers Against Poverty. They included Tara Hird, 36, and partner Brian Willett, 51. The couple has been at the Better Living Centre for three weeks and Hird is 35 weeks’ pregnant with their first child together, who they plan to name Greyson.

Both have been without housing or precariously housed for years and met inside the emergency system. OCAP and supporters planned to take them to Tory’s office to demand they be relocated immediately. Willett said the biggest barrier to moving forward with their lives has been a place to call home and with a baby on the way the couple is increasingly worried about their future.

“We need the first and last months rent and an actual apartment. Give us that and I’m sure we’ll surprise you and move on,” with their lives as a family, said Willett.

“That is the hardest part getting that apartment,” said Hird, who described living inside the Better Living Centre, as “scary.”