Who needs reserve funds anyway?
“What’s a million?” a comment famously attributed to Canadian wartime minister C.D. Howe, is one of those lines so rich in its obvious contempt for the sensibilities of the average taxpayer that it is almost a shame that there is no record that he actually said it.
But we now know that the spirit of that remark lives on in today’s Toronto City Hall. Over the years, $1 million has increased to $2 million. And we now know that this is the premium Toronto City Council submitted for future taxpayers to pay, just so that they could bring down the curtain on a 15-hour day of kicking the same tired old issues around the floor of council on 2017 budget decision day, to the point where someone, in effect, said, “It’s late, we’re all tired, and we want to go home.”
It’s not as if the 2017 budget process hadn’t already gone through a long and detailed series of analytical steps and decision points long before midnight on February 15. There is a budget committee that meets regularly throughout the year. City staff had released their preliminary 2017 numbers before the end of 2016. Community information sessions had been held. Special budget committee meetings had taken place. Recommendations and proposals had been submitted, discussed, and voted on at the Executive Committee. The bulk of about $10.5 billion dollars of tax that supported operating spending in the original proposal had emerged from the process pretty much unscathed. Proposed spending lined up neatly with projected revenues, in accordance with the law that imposes at least that degree of fiscal discipline on every municipal government in the province of Ontario.
As the midnight hour approached, there was just one problem. After taking into account all the recommendations from staff in all departments, and after all the town halls, and after all the committee meetings, and deputations, and proposals, and votes, Toronto City Council decided that the budget they were about to adopt just didn’t provide for the City’s roads to be clean enough. Two million dollars in street sweeping, to be exact, had to be added to the plan. So it was added.
Once upon a time, there was a Council that held to an understanding that any proposal at budget time to increase a dollar of spending above projected revenues had to be accompanied by a proposal to reduce a dollar of spending in some other category. This understanding of basic arithmetic survived even the occasional case of drunken stupor. This time, however, Council decided to reverse a $2-million cut in street sweeping without turning its mind to how the additional spending was to be financed. After all, what’s two million?
It was then that it dawned on Council that they had created a new problem for themselves. The budget was out of balance by the amount of the extra spending. They had already agreed on a tax rate, and were not about to monkey with that to raise the required $2 million. Nobody wanted to cut $2 million from some other part of the budget—heck, they only had $10.5 billion to work with—who could hope to find any wiggle room in that?
More importantly, it was getting late. People were getting tired. Everyone wanted to go home.
To review: Provincial law requires a balanced budget. After a long day, Council inadvertently voted to put its budget out of balance by $2 million in the cause of well-swept streets. Someone had to find $2 million somehow, or everyone would have to stay up even later that night. Or, heaven forbid, come back another day and finish the job then.
Happily for all, the City maintains reserve funds. There’s well over $2 million in a sock in the City Treasurer’s office.
Some may have thought that it was there to finance major capital projects, or to cover an emergency need.
Then again, what greater emergency could there be than the need to get to bed on time after a long day of pretending that you know what you are doing?
So, after a few deft procedural maneuvers masterminded by the talented folks at the Clerk’s table, Council broke into the Treasurer’s sock drawer and helped itself to $2 million that future taxpayers will be expected to replenish.
Then everyone made their way home and had a good night’s sleep. The mayor even said so.
If only Penny O. had thought of that trick, she might be able to look forward to keeping the swimming pool that the mayor told her he would try to save. Ditto for the front line shelter workers who were cut from this year’s budget. And ditto for any number of other cost items that could have been salvaged with some portion of a late $2-million cash contribution.
But look at the bright side: operating spending continues to rise. Taxes continue to rise. TTC fares continue to rise (but not next year—there’s an election then). Other assorted user fees continue to rise even more than taxes—because no one will notice. The Scarborough subway continues to claim its status as a $3.4-billion capital spending commitment. The project to take down the Gardiner and put another one back up again still sits on the capital plan (but billions of dollars of acknowledged but unfunded capital repair and upgrade needs don’t, as the City’s structures get another year closer to their inevitable demise). And important and exciting new proposals languish on the shelf for lack of funding.
And City Hall continues to drift along for yet another year. No price is too high for the sake of maintaining traditions, after all.