Toronto’s budget takes a hit as Ontario to cut $150M in funding

As Ontario Premier Kathleen Wynne tries to mend fences with Toronto Mayor Rob Ford, her government is cutting almost $150 million in funding to the city.

But the province argues the cuts are more than offset by scheduled rises in other funding.

In his detailed, five-page missive to Toronto Mayor Rob Ford, Finance Minister Charles Sousa notes “provincial support has increased significantly in recent years.”

Sousa pointed out that Queen's Park is continuing to upload social assistances services from the city and is covering $125 million in court security and prisoner transportation costs.

The phase-out of the Greater Toronto Area Pooling program — a short-term measure the Liberals established to mitigate the downloading on the city by the previous Progressive Conservative government (in which Ford's late father, Doug, Sr., was an MPP) — will continue.

That means the $149.3 million the city received this year in pooling compensation will drop to $100 million in 2014 and $50 million in 2015, before being eliminated in 2016.

But Sousa insisted that is more than offset by uploads and “other ongoing support,” including a $230 million boost to the city by restructuring the outstanding Toronto debenture loan.

Indeed, overall, the province's contribution to the city — excluding funding for capital projects — will rise from $656.1 million this year to $766.1 million in 2016. That's a $110 million increase.

“Continued provincial uploads and other sources of ongoing provincial support will more than offset the phasing-out of Toronto's pooling compensation," wrote Sousa.

Read the letter.

“Through the upload of social service assistance benefit program costs, the province had directly addressed the issue that GTA pooling was designed to respond to – the pressure that the costs imposed on the property tax base,” Sousa wrote in the letter obtained the Star.

As a result, the “special revenue” to offset the downloaded costs, including social housing, will be eliminated, the finance minister said.

Before getting to the bad news, Sousa lists hundreds of millions of dollars in other provincial funding that will continue.

The funding cut will put Ford, who made his name espousing smaller, cheaper government, in the position of demanding a continuation of funding from a senior government trying to balance its books.

Earlier this week, Wynne told the Star that she has not spoken to Ford recently and expressed hopes that, for the good of the city and the province, they could improve their working relationship.

Original Article
Source: thestar.com
Author: David Rider, Robert Benzie