‘Perfect storm’: Ontario cities looking for new deals after Toronto agreement

As Toronto proposes a double-digit property tax increase for 2024, other cities in Ontario are calling for more funding and new deals, warning a “perfect storm” is on the horizon.

The proposed Toronto tax increase of 10.5 per cent comes despite a new deal between the city and Ford government worth billions of dollars.

At the end of November, the Ford government agreed to take responsibility for the Don Valley Parkway and Gardiner Expressway, saving Toronto from one of its most expensive assets.

The wide-ranging deal also included money for new subway cars, to tackle homelessness and pay to run two transit lines.

Now, with budget season underway in many Ontario cities, local mayors and councillors are looking at the deal as a template to help with some of their own costs.

Markham Mayor Frank Scarpetti said he “applauded” the province for its deal with Toronto but believes every municipality in Ontario needs to reset their relationships with Ottawa and Queen’s Park.

“We have a storm that’s coming, that’s hitting municipalities: aging infrastructure,” he told Global News.

“You’ve got decades now where there hasn’t been investment by senior levels of government.”

The Association of Municipalities of Ontario (AMO) echoed Scarpetti’s call in its submissions to the province ahead of the 2024 budget.

“We need a new fiscal arrangement,” said Brian Rosboroug, AMO’s executive director. “That new deal included a commitment to work with the City of Toronto in 2025 to take a look at the fiscal framework and that’s something we believe is necessary for the sector as a whole.”

The group, which represents local governments across the province, is calling on the Ford government to review and discuss its relationship with cities, saying too many health and social programs are falling on the backs of local taxpayers.

AMO said years of underfunding from other levels of government, inflationary pressures and aging infrastructure are threatening to crush local property taxpayers.

“We will very much be seeing increases in property taxes, user fees as a result of all of the various factors,” said AMO’s director of policy and government relations, Lindsay Jones.

1:48 Substantial property tax on the table for Toronto budget launch

Some cities are also making specific demands.

The City of Mississauga is asking the Ford government to pay to run its Hazel McCallion LRT line when it opens. The request is essentially for the same funding Toronto received to operate the Eglinton and Finch West LRTs.

“We need to look at continuing to upload,” said Mississauga Mayor Bonnie Crombie. “Especially anyone running a large transit system would need financial assistance from the provincial government.”

Hamilton is asking for two of its parkways, which connect to provincial highways, to be taken over by the province because they are an “essential” part of the provincial road network.

“I would welcome the opportunity to discuss a similar deal for Hamilton in which responsibility for such vital infrastructure is absorbed by the province so that the City of Hamilton can focus its resources on other urgent needs of its residents,” Hamilton Mayor Andrea Horwath said.

In Ottawa, the city has spent years lobbying to upload Highway 174 to the province.

The Ford government, however, is stressing its deal with Toronto was a one-off — and not a model for how it will work with cities across the province going forward.

A senior government source with knowledge of the Toronto deal and long-term government thinking said decisions over what to include in the Toronto package were made because the items were “unique” to the city.

The source said the Don Valley Parkway and Gardiner Expressway — two city-owned highways that will soon be uploaded to the province — are key arteries for economic activity with few comparisons in other municipalities.

The source said Queen’s Park is always open to working with local mayors to hear individual requests but would make funding decisions on a case-by-case basis, not under the umbrella of new deals.

Only Ottawa has the province’s attention so far with its highway funding request, the source said. Other cities — including Mississauga and Hamilton — are yet to convince Doug Ford to loosen the purse strings and fund their demands.

The source said the province was quite aware that requests made by the city during new deal negotiations would eventually be echoed by other cities.

Costs for policing, for example, were rejected because those financial pressures were not borne solely by the City of Toronto.

“When they put everything on the table we had to start pulling back, because if we do that we would be obligated or feel pressured to do a similar funding partnership with other municipalities,” the source told Global News.