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January 14, 2004
Moody's Investor Service issues Toronto's Credit Rating Report
Moody's Investors Service has released a report confirming the City of
Toronto's Aa1 rating with a stable outlook, reflecting the City's commitment to
maintaining fiscal discipline through "prudent management policies." This
positive rating is only one level below Moody's highest credit rating of Aaa.

This report, dated January 12, 2004, states that the implementation of the
City's five-year capital program can be achieved with "modest debt levels in
the medium term." However, the report states that there is a continued need to
implement new municipal financial arrangements with the provincial and federal

"Moody's recognizes the importance of a new deal for the City of Toronto," said
Mayor David Miller. "New initiatives such as implementing the gas tax and hotel
tax, and removing restrictions on the City's taxing authority would support
municipal finances well into the future."

The report points to the importance of accessing these new revenue sources to
lessen municipal reliance on property taxes and provide more financial
flexibility in meeting our service requirements. Mayor Miller continues to
stress the need for a strengthened fiscal relationship with other levels of
government. The report states that the newly elected provincial government and
new leadership at the federal level may provide an opportunity to develop
improved relations and a new financial arrangement.

Budget Chief David Soknacki noted that Moody's stated that the City of Toronto
has managed a number of "organizational and fiscal challenges over the past few
years" through the implementation of "service efficiencies."

"The report shows that the City, through its budget and financial planning
process, is working on fiscal sustainability," said Soknacki, "but we still
need the support of the provincial and federal governments if we want to
maintain or improve our credit rating."

Moody's states that although the City was impacted by a series of unpredictable
events during 2003 such as SARS and a massive power outage, a healthy economic
growth rate of four per cent is being forecasted for 2004 for the local economy
that is characterized as "the focal point of the Province of Ontario's
diversified industrial and commercial heartland."

Media contact:
Cindy Bromley
Finance Communications Manager



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