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November 28, 2011
City of Toronto launches 2012 Budget process for Tax Supported Operating and Capital Budgets
Today, the City of Toronto officially began the 2012 Tax Supported Budget process.

City Manager Joe Pennachetti, Chief Financial Officer Cam Weldon and Financial Planning Director Josie LaVita presented a proposed 2012 tax-supported City budget to the Budget Committee, chaired by Councillor Mike Del Grande (Ward 39 Scarborough-Agincourt).

The recommended 2012 Operating Budget of $9.4 billion is balanced and includes a modest property tax increase of 2.5 per cent and recommends a 10-cent fare increase for TTC customers.

The proposed 2012-2021 Capital Budget and Plan is $14.8 billion and continues to place emphasis on maintaining and protecting the City’s existing infrastructure and physical assets. Also tabled is a plan to fully accommodate the TTC's 10-year capital plan that includes infrastructure projects associated with increasing service demands and ridership growth.

As identified through the City's Long Term Fiscal Plan, the City continues to have a structural deficit caused by the use of one-time revenues to close an annual operating budget shortfall, growing capital demands and operating expenses that are rising faster than the growth in revenues.

The proposed operating and capital budgets change the course of City finances by bringing City revenue more in line with City expenses through a permanent reduction of approximately $355 million in annual expenditures. This action reduces the City's reliance on one-time revenues from $346 million to $83 million. A proposed strategy for balancing the 2012 Operating Budget was presented that includes $267 million in budget reductions and efficiencies, $88 million in service level adjustments to services and $336 million in increased revenue.

In an effort to achieve fiscal sustainability, the proposed City Budget also includes an updated debt forecast that reduces the City's long-term debt requirement by an estimated $700 million. The debt reduction is expected to come from proceeds from the potential monetization of City assets, provincial and federal assistance, and use of future operating budget surpluses in accordance with the City's surplus policy. Through these actions, the intention is to fully finance the TTC's capital plan and to minimize the amount of property taxes used to pay debt financing costs while maintaining the City's debt service ratio below its 15 per cent threshold in relation to property taxes.

The 2012 staff recommended budgets follow a series of public consultations held throughout the city in May where residents discussed which City services are important to them. Over 1,200 people provided feedback at the Core Service Review consultations and more than 13,000 people completed the Core Service Review feedback form.

Toronto City Council will review and approve the final 2012 Operating Budget and 2012-2021 Capital Budget and Plan at its meeting on January 17-19, 2012.

On November 10, the City began the 2012 Budget Process with the launch of its staff-recommended rate-supported budgets for Toronto Water and Solid Waste Management which are approved separately, and will be considered by Council at its meeting on November 29 and 30.

Residents and businesses are invited to participate in the 2012 Budget process. On December 7, residents and businesses can make a public presentation to the Budget Committee in Committee Room 1 by calling 416-392-1032 or 416-397-7768, or e-mailing no later than 4 p.m. on December 6. If necessary, the committee will reconvene at 9:30 a.m. on December 8 to hear any remaining speakers.

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Toronto is Canada's largest city and sixth largest government, and home to a diverse population of about 2.7 million people. Toronto's government is dedicated to delivering customer service excellence, creating a transparent and accountable government, reducing the size and cost of government and building a transportation city. For information on non-emergency City services and programs, Toronto residents, businesses and visitors can dial 311, 24 hours a day, 7 days a week.

Media Contact
Wynna Brown
Manager, Media Relations and Issues Management

Cindy Bromley
Manager, Finance Communications



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