No. City services need full funding

Property taxes may not be the most favourite bill you get each year. But since cities don’t have the revenue options that senior levels of government have, property taxes are the meat-and-potatoes of city revenue generation.

They are imperfect: Property taxes revenues don’t grow along with economic activity and population growth, as incomes and sales taxes do.

They’re also a political challenge: Every year, city council has to vote to ensure property taxes keep up with funding needs (considering limited revenue-raising options). Those increases are often front page news and can be remembered for years. That makes it harder to have property taxes keep up with inflation, population growth and increased demand for services.

But, as voters, are we rewarding mayoral and city councillor candidates who overpromise service improvements without responsibly ensuring those promises are adequately funded? In short, yes.

For eight years, Toronto property tax increases have been kept below inflation and population growth.

Mayor John Tory has explained that one of his measures to help to make the city more affordable is to keep property tax increases at or below the rate of inflation, as he has done for the past four years, as Rob Ford did for the four years before.

The problem is that doing so will put Toronto in an even deeper financial hole. Any politician promising better public services without touching property taxes isn’t telling the whole story.

Just to maintain the status quo — which shouldn’t be the goal in an expanding city — Toronto would need property tax increases that grow with both population and inflation. That would be about 50 per cent higher than inflationary increases only.

Over the past eight years, city politicians have relied on luck and unsustainable fiscal practices to balance the books: atypically high revenues from the land transfer tax, the use of reserve funds intended for rainy days, and increases in user fees, such as parking, water and TTC fares.

Every year, there is the hope city staff will be able to do more with the same resources. That’s not realistic.

We see the impact of this unsustainable fiscal approach all around our city: dangerous crowding in subway stations, a desperate need for repairs in Toronto Community Housing, flooded streets during climate events, insufficient shelter beds in the height of winter, timid investments in the city’s poverty reduction strategy and digital line ups to get kids into recreational programs.

Did I mention $30 billion in unfunded capital projects?

Even worse, each year that we delay increasing property taxes has an impact on both our current and future capacity to fund essential city services.

But what if we approached property taxes in a grown-up fashion?

As grown ups, we know that we’re better off changing the oil in our cars on schedule as part of a good maintenance program. We know that dealing with the mould in the basement as soon as possible is the best financial and health strategy. And when we can, we know that putting money aside for our retirement is the prudent thing to do

We are doing none of this for our larger home, the City of Toronto.

We are letting the mould spread. We are emptying our saving accounts. We are not investing in our children’s futures.

Instead, we’re sticking them with a bill years down the road as more unavoidable service upgrades make it non-negotiable to invest in aging infrastructure, crowded public transit and poverty reduction strategies.

Any city politician promising good public services without property tax increases should be challenged to identify which public services and infrastructure investments they are ready to cut. What are they going to sell off or privatize? How much higher are city fees going to be?

As residents, we also don’t get a free pass. Voters who choose tax-freezing candidates must come to terms with deteriorating public services and sticking the bill to our kids and grandkids.

You get what you pay for (and what you don’t pay for). Paying property taxes are what you and I do to improve city services.