Chow to trim tax hike to 9.5 per cent in Toronto budget set to be unveiled Thursday

Toronto Mayor Olivia Chow is set to unveil a budget Thursday that includes a 9.5 per cent tax bump for homeowners.

The staff-proposed budget released on Jan. 10 called for a nine per cent property tax increase, as well as a 1.5 per cent increase to the City Building Fund. That 10.5 per cent bump would have amounted to an increase of about $360 a year for the average Toronto household, Budget Chief Shelley Carroll said at the time.

The mayor’s office confirmed to CTV News Toronto that Chow is proposing lowering the property tax hike to eight per cent. Combined with a pre-approved 1.5 per cent increase to the City Building Fund for transit and housing, that would bring the total 2024 residential increase to 9.5 per cent.

The hike would amount to the largest property tax increase since amalgamation and follow a seven per cent increase put through in former mayor John Tory’s last budget before he stepped down a year ago.

Chow has been gathering feedback from councillors and the public over the past few weeks, and is set to unveil her version of the budget, which will go to city council for debate next week.

The mayor is scheduled to hold a press conference at Scarborough Centre Station at 10:30 a.m. CP24 will live-stream the announcement.

The mayor said as late as Monday that she was still listening to residents in deciding how high the property tax increase should be.

However, she did say that she would make sure that the total increase for multi-residential properties was not higher than 3.75 per cent so that renters aren’t saddled with above-guideline rent increases from landlords passing on the tax hike.

She did not say earlier this week how she would pay for the move.

The mayor has said that she intends to table a budget which can be passed through a vote at council, where she has promised not to use strong mayor powers to push it through.

Deputy Mayor Jennifer McKelvie previously told CP24.com that councillors were “looking for some sort of cost control by the mayor when she presents her budget.”

Ottawa gives more for asylum seekers

City staff had also recommended a six per cent levy if the federal government did not commit to providing the city with $250 million a year to deal with refugees and asylum seekers.

The Trudeau government has not said exactly how much it will give the city, but in an 11th hour press release Wednesday night, they pledged a $362 million boost to a 2023-2024 fund to help provinces and municipalities “address extraordinary interim housing pressures” related to asylum claimants. Toronto received more than 50 per cent of the payments made through the same Interim Housing Assistance Program (IHAP) in 2022-2023.

Increase for police could be lower

It also remains to be seen whether Chow will follow through on a staff proposal to provide Toronto Police with a smaller increase to their budget than the Toronto Police Services Board recommended. The board had asked for an increase of around $20 million, but that increase was shaved by about $12 million in the staff-proposed budget. Police have been vocal about the change since then, with Chief Myron Demkiw seeing that it could affect wait times, as well as the level of service expected by the public from Toronto Police.

Transit advocates also expressed disappointment that there wasn’t funding to build a dedicated Scarborough busway. A recent report before the TTC said that the busway in the path of the former Scarborough RT wouldn’t be ready for at least three years.

Budget comes amid financial pressures

Chow’s first budget comes as the city grapples with crushing financial pressures resulting from a COVID-19 hangover and runaway inflation. The city started this year’s budget process with an opening shortfall of $1.8 billion. City staff said that some $600 million in savings was found through a line-by-line audit conducted by each department.

The mayor also scored a major victory in negotiating a preliminary new deal with the province, which will see Queen’s Park take back responsibility for the Gardiner Expressway and the Don Valley Parkway, a move which will save the city billions over the next 10 years.

But even so, the city still comes up short. By law, municipalities in Ontario must balance their budgets. Chow has said the city does not have room to cut its way out of the problem and appealed to both Ottawa and Queen’s Park for help.

With files from CTV Toronto’s Natalie Johnson