What You Need to Know About Toronto’s 2017 Water, Waste, and Parking Budget

Toronto actually has multiple City budgets! Think of this as the secret one that no one talks about.

By Neville Park

Photo by Dave from the Torontoist Flickr pool.

When people talk about the City budget or the budget process, they usually mean the tax-supported budget. But there’s another budget—or, rather, there are three. The water, waste, and parking budgets are funded by people paying fees for the services they use (and only the services they use). They make up the rate-supported budget, which Council will pass separately in mid-December.

Let’s go over what’s new in this year’s rate-supported budget. We’ll also talk about the advantages and drawbacks of this kind of budget, and why it should matter to you.

Water

Rate increase: 5 per cent.

Behind the numbers

We’ve already seen Giorgio Mammoliti (Ward 7, York West) flipping out over a “roof tax”. What the City’s actually doing is…slightly different.

Toronto Water’s central conundrum: as energy-efficient appliances become the norm, people are using less water every year.¹ This is good! But the cost of treating, delivering, and carrying away that water is going up. Extreme weather, like flooding or freezing, is very hard on pipes and sewers, and it’s becoming more frequent.

Flooding is such a problem in urban environments because all the concrete and asphalt (“impervious area”) can’t soak up stormwater—rain or melted snow. Instead, it all goes into the sewers.

Stormwater management is expensive. Right now, it’s 18 per cent of Toronto Water’s capital budget. In 10 years, it will be 40 per cent.² This is one reason water rates are going up. But it’s not ideal to pay for it this way, because user fees are supposed to be directly connected to what people are getting in return. And how much water a property uses has nothing to do with how much stormwater runoff they create.

That’s why many cities have started implementing a stormwater charge³—a flat fee based on how much impervious area a property has. At the rate-supported budget launch, Toronto Water head Lou Di Gironimo explained that there will be four tiers of charges and a more complicated formula for properties above 10,000 m^2.⁴ Staff are working on a report to be released in spring 2017, but the charges won’t be implemented until 2019. So relax, everyone.

Waste

Rate increase: 5.2 per cent. Details [PDF].

Behind the numbers

Solid Waste Management Services (SWMS) is the division that deals with garbage, recycling, and green bins. Once funded entirely by property taxes, it switched to a mostly user fee-based system in 2008. However, this system isn’t working out for them any more.⁵

A bit like Toronto Water trying to fund stormwater management with water rate increases, SWMS has been using garbage bin fees to pay for a lot of things that aren’t picking up garbage. They aim to fix this problem by charging for a bunch of things they weren’t before—for example, picking up oversized items like furniture, or cleaning up after street festivals and parades. Altogether, these extra fees will net them an extra $11 million or so.⁶

This is part of a systemic trend in the City’s budgeting. First, Council is staunchly opposed to raising property taxes, which means divisions must increasingly rely on raising user fees. There’s also the closely connected feeling that programs and services should “pay for themselves”, and if a service costs the City money to maintain, it is less efficient.

One upshot is that things that would cost the City money but can’t be funded by user fees go unfunded. One of those things is the City’s Long Term Waste Management Strategy. Council approved it last year, but they haven’t funded it [PDF].

Another example of where this kind of thinking leads: the eventual elimination of the garbage bin rebate [PDF], which is factored into this budget. SWMS has to do this to save money. That means the original purpose of the rebate—giving residents an incentive to produce less waste—has fallen by the wayside. And now there’s an $8 fee for SWMS to pick it up.

Parking

Rate increase: No.

Behind the numbers

This is the most boring of the rate-supported budgets. If it were an emoji, it would be ?. While the Toronto Parking Authority has rolled out some changes—expanding the Bike Share network, promoting a mobile app—not much is really new; parking rates haven’t changed in years.

This is one division that has no problem making money [PDF]; in fact, they made about $5 million more than they expected. It’s also one of the few divisions that handily met the Mayor’s 2.6 per cent budget cut request. We would emphasize again that the Parking Authority is actually vastly under-charging, but does it really matter when the City might sell it off anyway? We repeat: ?.