Toronto City Council is poised to set dates for the 2017 budget process with a report up for approval at its July 12, 2016 meeting. This report states:
By early August, 2016 all City Programs and Agencies will have submitted their Tax Supported Capital Budget and Plan and their Operating Budget requests to the Financial Planning Division for review and recommendation to the City Manager and Deputy City Manager & Chief Financial Officer.
Over the course of the rest of the summer and fall, each budget request will be analyzed and reviewed, with a first round of analysis and review undertaken by the Executive Director, Financial Planning from July to early September. A second round of review will occur with the City Manager and Chief Financial Officer to review unresolved issues and recommendations with the Deputy City Managers and respective Program and Agency Heads. The Preliminary 2017 Operating Budget and 2-year Plan and a 10 – year Capital Budget and Plan will be finalized by the end of October to provide sufficient time to prepare the necessary budget documents, communications and budget website in time for the Budget Launch. [p 17]
The Executive Committee, in transmitting this report to Council, has recommended:
3. City Council adopt an across the board budget reduction target of -2.6 percent net below the 2016 Approved Net Operating Budgets for all City Programs, Agencies, Toronto Community Housing Corporation, and Accountability Offices [Agenda Item 2016.EX16.37]
The report also lists budgetary pressures going into 2017, and for the TTC these include:
Base requirements for system operation: $136 million Presto card implementation: 29 Annualization of 2016 changes: 13 Revenue loss due to declining ridership: 12 Total: $190 million Anticipated revenue from a fare increase: $ 12 million
- The base requirements include inflationary increases plus startup costs for the Vaughan subway extension (TYSSE). Although its planned opening date is at the end of 2017, operating costs will begin to accumulate earlier in the year with no offsetting revenue. Ongoing operating losses are expected to exceed $10m annually, but this will be an issue for 2018’s budget.
- Presto card implementation was supposed to be cost neutral, but at least during the cutover period, TTC will bear costs of the new and old fare collection systems. Looking further ahead it is unclear whether there will be new long term costs associated with redeployment of the Station Collector staff to station management duties.
- The annualization value is derived by subtracting the first two items from the consolidated value of all TTC pressures which is given as $178m.
- The revenue loss is versus the budgeted level of revenue for 2016.
The 2016 budgeted subsidy level is $493.6m for the regular system plus $116.7m for Wheel-Trans for a total of $610.3m. A 2.6% cut translates to $15.9m, and so the TTC is facing a drop of over $200m relative to its already-identified needs. This is not the scale of cut that is absorbed by minor “efficiencies”.
The TTC Board has a Budget Subcommittee where one might expect a discussion and response to financial pressures might be discussed, but all meetings planned for 2016 to date were cancelled. The committee is scheduled to meet on September 6. A meeting of the full board to discuss overall policy and direction was planned for April 7, but this was also cancelled.
There are no public meetings planned before the “early August” deadline for a preliminary budget submission to the City Manager, and we have no way of knowing what options might be under consideration by TTC management or the Board. Moreover, any advocacy that might take place during this process will be completely hidden, and there will be no information about options for 2017. This could very well suit Mayor Tory and his TTC Chair Josh Colle, but it begs the question of just what the TTC Board is for if not to discuss options and examine the potential effects of funding changes.
In late June, Chair Colle’s office wrote to a regular reader of this site saying:
The TTC Budget Committee is comprised solely of a handful of members from its Board – currently, Chair Colle and four other Board members sit on the committee.
There was a Budget Committee meeting scheduled for this June, but it was cancelled because the TTC Board members felt that the current budget issues are so pressing that they should come before the entire Board, not just the handful of Board members sitting on the Budget Committee.
The budget items will be making their way before the TTC Board as a whole, so that all of the Board members can weigh in on the agency’s financial situation. That being said, the TTC Budget committee will still be holding meetings in the fall, in advance of the 2017 Budget. [June 27, 2016]
These issues may be “pressing” but clearly not enough to warrant the Board’s attention at this time. The next meeting of the full Board is scheduled for September 28, 2016, well after the lion’s share of work on budget review will have been done. Indeed, the City’s Budget Committee will already have begun its informal review of the 2017 plans before the TTC Board’s next opportunity to debate and set policy for the new year.
The July 11 TTC Board meeting agenda is long, and important items will not receive the debate they require. The 2017 budget issues are mentioned only in passing as part of a review of ridership problems, not as a broader review of funding, fares and service options.
What is the purpose of this Board?
A long-standing problem at the TTC has been the absence of advocacy, of the presentation of options. Toronto may not be able to afford every item on the transit wish list, but at a minimum, we should understand what options are even on the list, and what they might cost.
There was an “Options” report in August 2014, during the interregnum between TTC Chairs Karen Stintz and Josh Colle. The publication of this report greatly annoyed then-candidate Tory’s campaign because it appeared to support positions taken by Olivia Chow. After election, Mayor Tory discovered that transit really did need improvement, and seized on this as a way to establish a toe-hold on more progressive policies.
With cancellations and a long gap before their next meeting, the TTC Board is not participating in a very necessary public discussion of transit’s future at a critical time. The Mayor’s Budget and Executive Committees may slash any TTC proposals to ribbons, but this should occur in public, not by way of a secret initial budget submission from TTC management.
Meanwhile, Council is about to debate billions in capital spending for several rapid transit projects. These cannot possibly be afforded without new revenue, new taxes by whatever name they might be called. Council as a whole steadfastly refuses to accept the link between a “no new taxes” policy and the inability to provide service, let alone build new lines and maintain the infrastructure we already have.
Mayor Tory and Chair Colle were happy to announce new money for transit over the past two years: new services, restoration of the Ford/Stintz cuts, and free transit for children to name a few. The proposed budget policy for 2017 undoes all of that investment and more. Where will the photo op be held to announce the cutbacks?