City of Toronto  

Living in TorontoDoing businessVisiting TorontoAccessing City Hall
All news releases
Last 30 days
By month
Archived news release by year
  2012 - 2011 - 2010
  2009 - 2008 - 2007
  2006 - 2005 - 2004
  2003 - 2002 - 2001
  2000 - 1999 - 1998
RSS identifier linked to feed RSS
December 3, 2002
Proposed 2003 City Budget caps tax increase at 3 per cent
By managing efficiently, implementing cost saving measures and limiting new
programs, City staff tabled a proposed 2003 budget today that reflects some
extraordinary pressures but caps any projected tax increase at 3 per cent or
less, the lowest in three years.

Highlights of this year's proposed budget include maintaining 2002 service
levels, particularly for the three emergency services, limiting capital
spending thereby helping to manage and limit any debt increases, continued
improvements in efficient service delivery, and extraordinary pressures on the
operating budget, for which the City will seek assistance.

Chief Administrative Officer Shirley Hoy singled out the closure of the Keele
Valley landfill site at the end of December, transit operating costs and salary
adjustments for the three emergency services above 3 per cent, as
"extraordinary pressures" that resulted in the $6.4 billion budget containing a
projected tax increase.

"As in previous years, Bill 140 (provincial legislation) means that we have
access to only one third of our tax base and that any residential tax increase
is tripled for Toronto homeowners," stated CAO Hoy. "A 3 per cent tax increase
on the residential class for 2003 would raise approximately $32 million in
additional tax revenue. If this could be spread across the total tax base the
residential tax increase could be reduced to approximately 1.1 per cent, less
than the rate of inflation."

In his opening remarks at the joint Policy and Finance and Budget Advisory
Committees meeting this morning, Mayor Mel Lastman pointed out that it's not
going to be easy to reach 3 per cent. "The pressure on our 2003 Budget is
incredibly high. Once again, difficult decisions lie ahead of us - and we're
going to have to work harder than ever to deliver a budget within our means."

City of Toronto Budget Chair David Shiner emphasized that, "there are no
painless ways to absorb all of this year's budget impacts." He added, "staff
have worked hard to prepare a budget that maintains existing service levels and
absorbs the pressures anticipated in 2003 with the exception of the Keele
Valley landfill closure, TTC operating costs, and salary settlements for
emergency services above the cost of living and inflation."

The proposed budget ensures that Toronto residents continue to get good value
for their tax dollars by protecting service levels provided by key areas such
as Police, Fire, Emergency Medical Services and other areas such as the
homelessness and waste diversion, maintaining services introduced by the new
City of Toronto since 1998 and maximizing revenues from other levels of

The proposed $993 million capital budget maximizes federal/provincial cost
sharing for transit, but requires all other ABCs and departments to propose no
new debt pressures in order for the City to remain within its affordability

The City's Chief Financial Officer and Treasurer, Joe Pennachetti stated,
"Relying principally on the property tax base remains an inappropriate means of
funding the majority of the City's services." He added, "we need new
sustainable revenue sources to address the need for growth and service demands
in the City of Toronto through new financial partnerships with the provincial
and federal governments."

The City is engaged in productive discussions with the province to seek
assistance in offsetting some of the extraordinary operating budget pressures
in 2003.

Council will begin examining the 2003 City Budget on December 3. Standing
Committee reviews will begin the week of December 9 and continue throughout
December and into January 2003. Final approval of the capital and operating
budgets by Council is scheduled for late February 2003.

For more information on the 2003 City Budget, go to the City of Toronto Web
site at

Media Contact
Kevin Sack,
Corporate Communications,

Cindy Bromley,
Finance Communications,



Toronto maps | Get involved | Toronto links
© City of Toronto 1998-2019