Toronto CFO issues warning about 2016 budget crunch

Toronto's 2015 budget has cleared another hurdle, but not without some words of warning from the city's chief financial officer about the year ahead and some last-minute changes by budget-committee members.

As the committee approved the budget plan Friday, sending it to executive and a city council vote in March, CFO Rob Rossini said the Toronto will face a funding shortfall of about $350-million next year.

"As I have said, next year is going to be a difficult year," Mr. Rossini told committee members. "We have the equivalent of a 15-per-cent tax levy to find."

The final day of the committee's weeks-long deliberations ended with a flurry of changes, which included $5-million in savings from each of the police and TTC budgets, part of $25-million in last-minute adjustments made to fill an $86-million shortfall created when Mayor John Tory failed in his efforts to get provincial funding that was cut the previous term restored. The city will cover the rest of that amount with a loan from capital reserves – an unprecedented move announced last week.

Mr. Tory would not venture a prediction Friday when asked if the budget will pass. "That would be like expecting me to predict the weather three weeks from now," he said, but indicated he is optimistic.

During the committee meeting, members approved a surprise motion from Councillor Michelle Berardinetti that will undo budget measures made on the council floor last year.

The changes, which still require the approval of executive and council, would eliminate eight positions in the planning department to enhance area studies, heritage conservation district plans and strategic initiatives. The council also approved a motion from Ms. Berardinetti to deny a budget increase for additional staff for the city's ombudsman and integrity commissioner.

The budget debate took an unexpected detour Friday when councillors questioned the CEO of the TTC, Andy Byford, and were reminded that council voted last term to ask the city manager to explore turning the Scarborough rapid transit line into a park modelled after Manhattan's High Line.

Mr. Byford said that directive is what the TTC is going by and it has not budgeted any costs for demolition of the line when it is replaced by a subway extension.

Several councillors were caught off guard by this, including Councillor Shelley Carroll, a TTC commissioner, who suggested the new term of council might reconsider the plan.

She noted that unlike New York, the Scarborough RT right of way passes through an industrial area that the city is trying to protect. Putting a park there would be incompatible with that use and might create pressure for industries to move, she said.

TTC chair Josh Colle – one of 33 councillors who supported the motion in October, 2013 – said later it is not the TTC's job to build a park. Asked if he supports the idea, he responded, "Let's see what the report says."

With a report from Ann Hui