Council debates proposed budget cuts

The city’s “financial foundation is crumbling” and permanent solutions need to be found to fix the debt problem, Mayor Rob Ford told council at a heated special meeting Monday on controversial budget-cutting recommendations.

Councillors were discussing the recommendations put forward during a marathon session of the executive committee last week, as community and labour organizations rallied outside city hall against the proposed cuts into the evening.

“We’re talking about libraries, we’re talking about childcare, the TTC. There are many services that students need to perform their work and while we’re happy that some of these decision have been deferred or delayed, we’re worried that they might come back,” said Sandy Hudson, Canadian Federation of Students
 
“In the election campaign, he (Mayor Ford) said guaranteed there will be no layoffs, no service cuts, there will be no tax increases guaranteed — and here we are and now he’s implementing the worst of austerity programs,” said Sid Ryan, President of the Ontario Federation of Labour.

While activists were denouncing Mayor Ford and the possible cuts, many Toronto residents that attended the rally were also worried about the city’s future.

“I’m very worried about the city – I think the cuts he has on the table and that he’s proposing to do will hugely impact the city in such a negative way,” said resident Heather Jamieson.

Many protesters were carrying signs, reading “we’re not for sale,” “service cuts won’t solve the budget,” and “stop the crazy train.”

“These signs represent what we’re here to protest — the Ford brothers and their agenda to privatize and sell off our city,” said resident Mike Mahon.

Monday’s meeting started at 9:30 a.m. and ended at 8 p.m. The meeting will continue Tuesday at 9:30 a.m.

During his opening address and a subsequent question period, Ford once again insisted the city must plug a $774-million shortfall for 2012.

“That’s too big for all of us to fill with one-time money, even if we wanted to. This number is absolutely the real number,” he said.

“We cannot afford to fall short. We must fix the structural deficit … our growing debt is putting huge pressure on our financial foundation.”

The mayor insisted the city has a spending problem and not a revenue problem.

He reiterated his promise to phase-out the land transfer tax by the end of his four-year term. He cancelled the vehicle registration tax, which brought in approximately $64 million a year.

The mayor also said earlier this month that if a property tax is needed it would be limited to 2.5 per cent.

Ford faced questions from several councillors, including Sarah Doucette and Josh Matlow, who asked for exact figures on the cost-cutting recommendations.

Ford said those numbers would come out during the budget process in November. Matlow then asked if council decisions on slashing programs and services could be held off until then but Ford said the tough decisions have been deferred too long and need to be dealt with immediately.

Matlow later sparked a heated debate by proposing that the DVP and Gardiner become toll roads, with the proceeds used to fund public transit.

Coun. Mihevc said Ford’s decision to axe Transit City cost the city $50 million — a figure that wasn’t included in the $774 shortfall estimate.

Mihevc also asked senior city staff for a commitment to provide detailed budget briefing notes to councillors.

“Right now, I think most of us here would agree, we do not have the information upon which to make good decisions,” he said.

Coun. Adam Vaughan also grilled Ford on his definition of a core service. Watch the attached video to see their exchange.

Earlier this month, city manager Joe Pennachetti put forward a long list of suggestions to save $95 million next year, down from $100 million after the executive committee made some changes, and between $200 million to $300 million by 2014. His recommendations were based on a core service review released this summer by consultant KPMG.

After 20-hour meeting last Tuesday, the executive committee voted to defer some of the more controversial recommendations, including phasing-out subsidized childcare spaces, selling-off city-run long-term care facilities and closing library branches, until the budget process.

The executive committee voted in favour of closing museums with the lowest attendance, selling-off city-run landmarks, including the Toronto Zoo and three theatres, and eliminating city participation in the Christmas Bureau — a program that delivers gifts to tens of thousands of needy children and their families.

The committee also voted to hand responsibility of Heritage Toronto over to a non-profit organization.

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On Monday, councillors demanded exact figures the proposed program cuts could save the city, and Pennachetti and city staff disclosed the following:

• the 10 per cent budget cut that Pennachetti has asked each department to make will save the city about $360 million of the $774 million shortfall in 2012;
• reducing hours/days that public libraries operate would save the city $5.5 million in 2012; 
• the city funds the Toronto Zoo $11 million a year, but the city manager will issue a request for expression of interest on a potential sale. “We want to test the market,” Pennachetti said. “That’s what we want to do.”
• Pennachettic says he has not decided which museums will close, but estimates it’d save the city about $2 million in 2012;
• on average, a household uses one of the four free garbage tags provided each year, and it costs $500,000 a year for the city to run;
• the city would pursue an external firm to operate the Christmas Bureau, w
  hich works with donors, such as Starbucks, Chum and other companies, and pairs needy families with them. It runs six months of the year and requires a staff of six to 10 people.
• the budget for the Toronto Youth Cabinet for 2010 was $140,000;
• 32,800 people attended Environment Days in 2010 at 44 city events, helping to divert about 832 tons of waste, and it’s about the same this year;
• the amount that would be saved if High Park Zoo closed is $227,000 in 2012;
• on mechanical street sweeping, reduction in frequency would vary. In Toronto-East York, it’d go from once a  week to once every two to four weeks, for example.
• a new executive committee report says revenue from land transfer taxes is up 32.7 per cent, for the city. Vaughan says that’s the equivalent of $80 million;
• Enterprise Toronto assists about 40,000 people, and generates about 27,000 new businesses. Pennachetti acknowledges it’s something the city should encourage.

Also on the agenda, council will debate whether to approve the Voluntary Separation Program applications. The mayor is hoping to eliminate 700 positions at a one-time cost of $41 million in buyout packages, which Pennachetti said would be funded by the 2010/11 budget surplus.

And despite the results of a large poll, released earlier this month, that suggest Ford’s popularity has nose-dived, the mayor said the average people he meets in Tim Hortons and other places encourage him to “stay the course.”

“They like this review,” he said.

“If there was an election today, I believe I’d be re-elected.”

With files from Showwei Chu