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May 2, 2001
Council approves 2001 budget on May 1
  
Toronto City Council last night approved a $6.1-billion tax supported operating
budget and a $1.12-billion tax supported capital budget for the year 2001 with
another $1.034 billion committed as project cash flow over the next four years
for a total capital budget of $2.154 billion.

The operating budget is an increase of 2.6 per cent over the 2000 budget of
$5.9 billion, and requires a tax increase of five per cent on homeowners
because of provincial regulations limiting tax increases to the residential
sector.

Mayor Mel Lastman said, "This has been the most difficult budget in the new
City's short life. It points to the clear need for a redefinition of funding
responsibilities with both the provincial and federal governments. I thank
Budget Advisory Committee Chair David Shiner and all the members of the Budget
Advisory Committee and the chairs and members of the standing committees and
staff for their incredibly hard work."

Chief Administrative Officer Michael R. Garrett said, "This budget represents a
turning point for the new City. It is the most serious evidence to date that
without the legislative tools and resources to match the new responsibilities
facing this City, Toronto is clearly in an unsustainable position. And that's
not just Toronto speaking, it is now the view of bond rating agencies such as
DBRS, the Toronto Board of Trade and the Association of Municipalities of
Ontario."

Chief Financial Officer and Treasurer Wanda Liczyk said, "Budget 2001 shows the
urgent and critical need to get the Corporation on solid financial footing for
the long haul. On a positive note, the new budget process used this year
clearly works. More councillors have been involved in the process and they had
access to the key information necessary for sound decisions."

The 2001 operating budget reflects savings and efficiencies in service delivery
and the elimination of any room to manoevre in major expenditure and revenue
items. The 2001 capital budget strikes a balance between TTC cost pressures, GO
Transit expansion, the demand for new investments, the need for maintenance of
the City's infrastructure and the introduction of new, longer-term, state of
good repair programs for City assets. (See 2001 Budget Backgrounders at www.city.toronto.on.
ca
.)

The initial operating budget shortfall of $305 million was reduced to $203
million during the budget process. Provincial regulation changes and one-time
funding resulted in a further reduction to $48 million. A one per cent tax
increase limited to the residential class produces $9.6 million; the resulting
residential tax increase therefore becomes five per cent.

Discussions continue between members of Toronto Council and officials of the
Province to achieve a long-term solution to the inequities caused by
downloading and the tax revenue restrictions of the Province's Bill 140.


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