TTC needs more revenue, not massive budget cuts
Overcrowded, hot subways and streetcars are a common lament for Toronto’s TTC riders, but if city council follows through on a proposed operating budget cut, things will only get worse.
Toronto’s executive committee has given direction to city staff to cut 2.6 per cent from the 2017 net operating budget, or $15.9 million. But it doesn’t stop there.
All city agencies and programs are also being asked to absorb increases in costs over last year. Executive committee documents showed that TTC costs will increase by $178 million: including $29 million from Presto card implementation, increased operating costs from newly completed subways and service improvements — such as more frequent buses — that were implemented in 2016.
Add the $12-million shortfall in TTC fare revenues expected this year and the agency is already $190 million in the hole before counting the 2.6-per-cent cutback. To make this target, the TTC would have to cut costs by at least $206 million — a highly unrealistic figure.
To put it in context, a cut of that significance would represent 11 per cent of the TTC’s gross operating budget in 2016. A lot more than that neat and tidy 2.6 per cent net figure.
That would represent what is likely one of the biggest annual spending cuts in the TTC’s history.
Why would city council implement such drastic cutbacks to a vital service that is in need of additional funding to keep this city moving?
Three months ago, the city manager presented a report to council predicting the mayor’s desired budget direction on property tax increases (i.e., no substantive increase, even though current increases fail to keep up with inflation and population growth) would result in significant cuts to services.
Unfortunately, it’s looking like Mayor John Tory hasn’t read that memo: he claims that further savings can be made without cuts to services and that “the only people who would find it unpalatable would be those who want to preserve the status quo.”
He mentioned bringing in a task force to find more savings. He also drew parallels to the police task force, which found potential savings of $100 million, over three years, on a $1-billion budget.
But those savings are the equivalent of a 3-per-cent reduction in the annual police budget — less than a third of what the TTC is being asked to cut this year. There is no comparison. Curiously, on the same day the TTC’s response to the funding cut became public, Mayor Tory pitched the idea of a new downtown park that could cost tens of millions of dollars an acre.
Parks and green spaces are a vital dimension to any livable, walkable city, but we also need to address Toronto’s pressing priorities, to get the fundamentals in place — and the long-suffering TTC is among those fundamentals.
That’s pretty much what helped Tory get elected in the first place: Torontonians have no appetite for more delays in TTC improvements. The city’s future depends on action now.
So how does Toronto avoid spending cuts to the TTC? The city manager laid out the answer as plain as day in his preliminary address to council on this year’s budget: generate more revenue.
Study after study has confirmed Toronto doesn’t have a spending problem. It has a revenue problem — one that cannot continue to be ignored by city politicians seeking easy, short-term answers.
The mayor and city council will be coming up against this hard fact this year. If they don’t change their position on the minimal residential property tax increase, we will all be paying for the cost of that inaction. There is room to raise this tax: it’s the lowest residential property tax in the GTA.
There are other revenue options on the table, too. The city could draw on the special tax powers the province gave to this municipality and this municipality only; special powers that have remained untouched for years.
The City of Toronto Act allows city council to raise anywhere from $300 million to $1.2 billion in new taxes, such as a flat tax on non-residential parking spaces.
The revenue options — not more service cuts — are the only sustainable options before city council this year. Even the mayor has publicly said he’s open to new revenue-generating options. Time to take him up on that.
There is room for Toronto to raise its residential property tax, which is the lowest in the GTA