[Mike in TO]

Toronto Board of Trade

FOR IMMEDIATE RELEASE
February 16, 2006

HOW TORONTO CAN BALANCE ITS BUDGET

Board of Trade proposes solution to City’s budget crisis(Toronto) The Toronto Board of Trade today offered a solution to Toronto’s budget crisis, telling municipal budget hearings at City Hall that Council could reduce its spending plans, cut expenses and change user fees to balance its 2006 budget.

“It will not be easy,†said Board of Trade President & CEO Glen Grunwald, “It will require some tough decisions. However, it can and should be done.†He said the Board’s plan could save the City more than $750 million by:

• Eliminating spending increases that do not directly address Council’s highest priorities ($135 million this year)
• Adopting fair, effective, cost-based user fees ($300 million/year)
• Implementing all 800 of the money-saving ideas from the Auditor General (estimated in the millions of dollars/year)
• Using a competitive bidding process to find the best value for taxpayers (the same idea used to save $20 million on waste collection in Etobicoke and York)
• After taking these steps to get its house in order, making a stronger case for the province to upload the costs of social programs (up to $300 million/year)

Grunwald said the city bears responsibility for not controlling its spending and expenses, and for driving businesses away with unfair taxes, adding, “It’s hard to go looking for help when you’re also planning to hike your spending by 20% over three years.â€

The Board also suggested using about 10% of the savings from its plan – some $75 million/year – to reduce business taxes to closer to the GTA average, helping reduce the loss of jobs and tax-paying businesses from Toronto to outlying areas.

The Toronto Board of Trade is the champion of a competitive and vibrant Toronto with a mandate to serve, represent and unite the city’s business community. Founded in 1845, the non-profit organization represents 10,000 members with 500,000 employees, and incorporates the North York and Scarborough Chambers of Commerce. Information about
Board events, policies, advocacy and products is available at www.bot.com.

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[Mike in TO]

Re: Toronto Board of Trade - How Toronto Can Balance Its Bud

Miller was apparently very hostile to Glen Grunwald's presentation on behalf of the Board of Trade to the City Budget Committee.

Here is what Grunwald had to say.....

Thank you for this opportunity.

I am here today with bad news and good news.

The bad news is that our city is once again in financial trouble, and that the current proposals for a new budget will not solve this ongoing problem. The good news is that it’s not too late to turn things around; to balance this year’s budget and put Toronto’s finances back on track.

It will not be easy, it will require some tough decisions, but it can and should be done.

First, let me say that we agree that Toronto was the unfair target of downloading years ago. We have long advocated that the province should take back funding responsibility for its social services programs.

However, we all know that provincial uploading will not be enough. The estimated $300 million in savings will fall short of the city’s projected deficit this year and will do nothing to prevent further operating shortfalls in the future.

The simple truth is that the city itself is also responsible for its budget problems. Spending and expenses have risen, and the city’s tax base has been undermined by unfair business taxes.

We cannot keep relying on bailouts. Only good management can solve Toronto’s ongoing, systemic financial woes.

Here’s what we recommend:

First, eliminate spending increases that do not directly address Council’s highest priorities. That would save taxpayers $135 million this year.

Second, adopt a user fee policy that is more fair, effective and matched to actual costs. Your own staff reports say doing so will generate up to $300 million more in annual revenue.

Third, immediately start using all the recommendations of the Auditor General. Many of his 800 money-saving ideas have yet to be adopted or fully implemented.

Fourth, use a competitive bidding process to compare delivery costs for services and find the best value for taxpayers -- the same idea used to save $20 million on waste collection in Etobicoke and York.

Fifth, after taking these responsible steps to get your house in order, you will be in a much stronger position with the province to argue for uploading. After all, it’s hard to go looking for help when you are also planning to hike your spending by 20 per cent over three years.

These measures will result in at least $750 million a year -- probably a lot more - in additional funds for City Hall.

We recommend you take ten per cent of those extra funds, about $75 million a year, and use it to reduce Toronto’s business property taxes to better match those in the rest of the GTA. That will help stop the bleeding of jobs out of Toronto and help rebuild our damaged economy and tax base.

Whether or not you get more money from Queen’s Park, this is a time for prudent management. We urge Council to seize control of the city’s finances in this budget.

I would refer you to our written submission for details on these points, and I thank you for your time today.

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[EnviroTO]

Re: Toronto Board of Trade - How Toronto Can Balance Its Bud

The Toronto Board of Trade has been supportive of the fact that the city needs a better deal. Good to see that he also realizes that Miller and the gang aren't doing as much as they can either.

 

[blixa442]

Re: Toronto Board of Trade - How Toronto Can Balance Its Bud

Are other cities in the same situation as us?

 

[maxy505]

Re: Toronto Board of Trade - How Toronto Can Balance Its Bud

Miller & the gang are spending money like a bunch of rap stars... Hopefully our city won't go down this road as far as B.C. did before we turf these NDP fools.

 

[AlvinofDiaspar]

Re: Toronto Board of Trade - How Toronto Can Balance Its Bud

blixa:

Are other cities in the same situation as us?

Are there other cities like Toronto in Ontario?

re: BOT's plan

I am not against some of the measures, when applied judiciously, but that being said, just how much of a cost difference for businesses would it make even after the plan? It assumes that the city would then be competitive by default, without consideration of additional factors.

AoD

 

[JoeyCuppa]

Re: Toronto Board of Trade - How Toronto Can Balance Its Bud

I've heard that unlike many on the BoT, Grunwald is very anti-transit and anti-cycling, thinking that these things "get in the way of business".

 

[Mike in TO]

Re: Toronto Board of Trade - How Toronto Can Balance Its Bud

How to lose a business friend
Feb. 17, 2006. 08:27 AM
ROYSON JAMES


In most towns, business is king. The local chamber of commerce wields considerable clout.

The mayor does his utmost to coddle businesses and make sure the local employer is extremely happy, lest the company closes its doors and scores of townfolk are put out of work.

But here, where we've lost 100,000 jobs in the last decade and only two office towers have been erected over the same period? Here, we stomp on our business "friends."

City councillors met yesterday to get public feedback on the 2006 budget.

By the budget chief's score card, the 37 people or groups who showed up at city hall can be grouped this way:

Twenty-six wanted to spend more; three wanted to spend less; three had ideas and four "offered support for what we are doing now; and "one we couldn't figure out" what was wanted, said Councillor David Soknacki.

But instead of being pleased with the near-unanimous endorsement, councillors attacked three of the four advocates for business.

They peppered Tasha Kheiriddin of the little-known Canadian Taxpayers Federation. Refreshingly, she fought back.

Raise user fees, raise TTC fares and cut taxes, she told them — an unpalatable brew for Mayor David Miller and his NDP ruling party. In fact, it's unpalatable to the majority of us. But the view should be welcomed, especially when the city is still $212 million short of a balanced budget.

Instead, Miller saved the most virulent attacks for Glen Grunwald and the Toronto Board of Trade. It was the board of trade that launched a letter-writing campaign to Ottawa to seek a new deal for the city. So one would have expected Miller to cut them some slack.

Grunwald presented a 19-page brief on the city budget. Queen's Park should upload the costs of social housing and social services, he said, agreeing with Miller. But council must swallow some bitter pills. For example, adopt and implement more than 800 recommendations from the city auditor. Rethink spending on new programs. Increase user pay by $300 million. And look at privatizing some services.

In total, it was as good a response as one expects from a business lobby.

But Miller lit into Grunwald and challenged the president of the board on detail after detail, belittled his claim of $300 million being available in user fees, and topped it off with this flourish:

"You've now just agreed with about two-thirds to three-quarters of our budget. All your other comments relate to the final quarter. And I hope, I mean the board of trade is a pretty sophisticated organization, I hope that next year you can help us by analyzing that part and offering more helpful suggestions."

Rarely have we seen such a public dressing down. And even after that, Grunwald took the high road, saying he was at a disadvantage because he doesn't know the nitty-gritty of the budget and "the mayor is a smart man."

Not smart enough, though, to know how to treat his friends.

David Fleet, representing the Toronto Office Coalition, a group that wants tax rates for businesses lowered to stem the flow of jobs out of Toronto, was aghast at what happened.

"The board of trade is generally supportive of Miller and the city. If there's any criticism, it's that it's too supportive. Attacking them from the left? I don't understand the politics, the economics and the social conscience of it."

Miller said he was just trying to "clarify the facts."

"Today's presentation really didn't befit the role they have as city-builders."

Well, excuse us.

Members of the public come to city hall to give their views on the budget. They don't have to be learned, cogent, credible or sensible. It's how democracy works. Councillors listen and work to find common ground in their arguments. That's how it's done at city hall.

Unless you are a member of a business group whose message is: get your financial house in order, then go to Queen's Park for help.

The board of trade, the Canadian Taxpayers Federation and the Canadian Federation of Independent Business voiced that message and were treated like skunks at a garden party.

Has this little band of city rulers grown so arrogant after two years in power?

 

[AlvinofDiaspar]

Re: Toronto Board of Trade - How Toronto Can Balance Its Bud

I think it's way too early to make any judgement calls given the weak mayor system and parochial interests of the current council. The proof of the pudding would come after the New City of Toronto Act and the executive system comes into place.

AoD

 

[billonlogan]

Re: Toronto Board of Trade - How Toronto Can Balance Its Bud

Using a competitive bidding process to find the best value for taxpayers (the same idea used to save $20 million on waste collection in Etobicoke and York)

This is a no brainer and should be implemented ASAP.

 

[fiendishlibrarian]

Re: Toronto Board of Trade - How Toronto Can Balance Its Bud

Highly unlikely. I've seen brand new garbage and recycling trucks all over the city since the new year began.