The Ford government has promised to help Toronto cover a third of its looming budget shortfall and outlined assurances that its controversial housing bill will not make municipal finances worse.
In a letter to Toronto Mayor John Tory, Minister of Municipal Affairs and Housing Steve Clark promised to help with the city’s “distinct budgetary challenges.”
Clark said Ontario was working to provide funds to cover one-third of Toronto’s $703-million operating budget deficit.
He suggested provincial help in the future may be less likely, though.
“It is critical that you use this support and the time it provides to take action to address Toronto’s forward looking operating pressures,” Clark wrote.
Tory, who has begged federal and provincial officials to help bailout city hall and reduce its deficit, welcomed the news before pivoting to a plea for funds from Ottawa.
“This significant step forward now puts into sharp focus the need to have the Government of Canada address its clear commitment to assist with what is an exclusively COVID-19 related shortfall being experienced in a more substantial way by Canada’s largest city,” he said.
In his letter, Clark also sought to alleviate concerns in Toronto about the effects of the province’s controversial housing legislation, Bill 23.
The new law, which received royal assent on Nov. 28, caused consternation amongst Ontario’s cities, which called emergency council meetings to decry the losses they could suffer.
Rules in the legislation reduce the money and land developers must give to cities when they build.
The Ford government argues this will lower the cost of building and therefore buying new homes; cities say it will lead to massive property tax increases and reduced public services.
In his letter, Clark referred to “unsustainable and out-of-control municipal fees.”
The minister, who has defended his bill, told Tory he planned to audit Toronto’s finances and help to “make improvements to how municipal funds are managed and infrastructure projects are contracted.”
It is unclear if the audit and promise of funding extends to other municipalities as well.
In his letter, Clark said that, if Toronto did see its “ability to fund housing-related infrastructure and services” hurt as a result of the legislation, then Ontario would ensure city hall is “made whole.”
— with a file from The Canadian Press